The number of Chinese who surfed online using their phones increased more than 10 per cent annually for the past three years, according to the report released by China Internet Network Information Center (CINIC).
During the past year, the number of Chinese who used mobile phones to make payments reached 469 million people, an increase of 31.2 per cent from 2015.
Chinese netizens have hit 731 million, accounting for 53.2 per cent of the total population, 3.1 per cent higher than the global Internet penetration rate and 7.6 per cent higher than that of Asia.
In 2016, Chinese netizens used Internet-based government services more often than offline service centres and hotlines.
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Government information was disclosed to the public in an increasingly mobile, immediate and transparent manner, the report said.
In addition, Internet coverage expansion has helped improve people's living standards and boost e-commerce, state-run Xinhua news agency quoted the report as saying.
For instance, the number of Chinese who ordered takeout online had reached 209 million as of December 2016, a year-on-year increase of 83.7 per cent.
Quality of network dramas improved, with some ranking among the most popular for the year, according to the report.
The number of listed Chinese Internet enterprises reached 91, with an aggregate value of 5.4 trillion yuan (786.1 billion US dollars).
Tencent and Alibaba accounted for 57 per cent of the total value.