The latest report issued by technology research and consulting service provider Analysys shows that China had 118.72 million instant communications users in 2006.

The report says that Chinese instant communication industry continued to see a user increase in 2006 with an annual compounded increase rate of 50.73% from 2002, and instant communication users accounted for 80% of the total internet users in China.

However, according to the report, China's instant communication user increase and new users increase slowed down in 2006 due to the saturated market and other development bottlenecks. Currently the sector is dominated by Tencent's QQ, MSN Messenger, Yahoo, and Skype.