China's Internet population is expected to reach 78 million people by the end of the year, said senior officials of the Internet Society of China during a weekend conference in Beijing.

　　Hu Qiheng, the chairwoman of the organization, said by then China will account for one ninth of the world's total Internet users and will have the world's second largest Internet user population next only to that of the United States.

　　"A new round of broadband Internet infrastructure has started. The fee-based Internet service model has been increasingly accepted by customers. We can also see huge potential in the mobile Internet sector," she said during the Second China Internet Conference, which was held in Beijing.

　　It is the largest annual gathering of Chinese scientists, officials and executives related with the Internet industry.The Chinese are also one of the world's most active short message senders, she said, noting that about 30 percent of the world's short messages are sent by Chinese mobile phone subscribers.

　　Also at the conference, officials from the Ministry of Information Industry said by 2005, more than 40 million personal computers will be linked to the Internet in China. The penetration rate of Internet users in the country will reach 15 percent, a huge jump from the current proportion of 0.6 percent.The increasing popularity of the Internet will help the development of China's chip design industry a lot, according to Wang Peng, vice president of CCID Consulting Co Ltd, a Beijing-based IT research company.

　　"The core of the Internet society is the chip. The surging demand of personal computers and entertainment electronic equipment will foster China's chip design industry - the weakest point in China's chip industry," he said.

　　The output of China's integrated circuit design industry will quadruple by 2005 from this year's 3.24 billion yuan (US.36 million).

　　China is aggressively encouraging investment in the semiconductor industry, which consists of IC design, chip production and chip assembling and testing.

　　"Most domestic companies focus on semiconductor manufacturing and chip assembling and testing business. However, chip designing, the most profitable part of the industry, is controlled by overseas companies," Wang said.