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Examines Internet diffusion in the major academic institutions of China and the USA, by age, gender, occupation and educational attainment. Reckons similar data from other nations is needed t support the conclusion that diffusion of the Internet into general population is faster in developed than in developing nations.

Focusing on the telecom manufacturing industry in China as a case, this paper contends that the existing literature needs to be expanded. Product cycle theory could be applied to explain multinational corporations’ strategies of importing and localizing their products in developing countries in order to take advantage of lower labor costs and to break barriers to the local markets. However, rapid technology changes have limited the power of traditional product cycle theory while favoring the “dynamic adding‐and‐dropping” product cycle. Meanwhile, the success of “Wintelism” and the maturity of cross‐national production networks in the global market have significant impacts on developing countries’ indigenous industries. Indigenous manufacturers start to take advantage of their strength in the distribution and production value‐chain and to outsource their weaknesses to Western corporations. This model of “reversed cross‐national production networks” represents a feasible industrialization path with great potential to enable indigenous manufacturers to emerge as competitors in advanced Western markets as well as less developed markets.

This paper documents and examines the course of the Little‐Smart deployment in China by looking closely at the technology comparison, demand pull and supply push, as well as government regulations.

It deploys an empirical approach and relies on second‐hand statistical data and some interviews.

Findings suggest that the competitive advantages, including the price difference between low mobility services and cellular phone services, are the most significant drivers for the fast deployment and growth of low mobility services including PHS and Little‐Smart service, with the aid of other non‐economic factors. The changing landscape in China's wireless market, including possible significant drop of cellular phone service prices as well as overall business and regulatory dynamics, will create an uncertain future for the Little‐Smart service to move through its product life cycle in the next few years.

Findings of this study could be significant both for China and for other countries to optimize their strategies for low mobility services.