BEIJING: Social networking, mobile content and online games and video will be the key forms of media in China in the next few years, and are set to pose a "real challenge" to the dominance of state-controlled traditional media, says Duncan Clark, chairman of consultancy BDA.

Speaking at the Digital Business China conference, Clark said China has the "largest TV and print audience in the world, but very low production values in the media sector", leaving space for the new media industry to make a substantial impact.

BDA predicts that online gaming revenues will reach $8 billion (€6.4bn; £5.7bn) by 2012, while the number of internet users in China will rise to 389 million this year, with penetration levels reaching nearly 70% in major cities like Shanghai and Beijing.

Clark also suggested that the dominance of search engines like Baidu – as opposed to major international equivalents like Google – has shown that the domestic online industry is flourishing.

These trends, combined with the need to stimulate domestic demand as exports decline, and the better value offered by online than traditional media, mean internet adspend is likely to post a double-digit increase this year.

He also argued that "media is future is the future of telecoms", and thus while China Mobile currently has a 73% share of the mobile market, China Telecom appears to be gaining ground, and has a more developed 3G system at its disposal.

Another national mobile network, China Unicom, is also said to be nearing a deal with apple to launch the iPhone in China, which could greatly increase its presence in the country's telecoms market.

Data sourced from; additional content by WARC staff