" Poverty has stunted further growth in Internet users , which has kept the Net user population to around 50 percent ," Li said .
Meanwhile , domestic Internet users have formed a mobile payment habit , with the number of users making payments through smartphones skyrocketing to 469 million last year , up by 31.2 percent from the previous year .
The report said searches , online music and videos , and online payments were among the most popular mobile applications .
Users of food delivery apps rose by 83.7 percent in 2016 , the fastest increase . The report found that 208.6 million Chinese use their phones to order food .
However , most Internet users remain concerned about cyber security issues , according to the report . Only 28 percent of netizens said they believe the Internet was safe , while more than 70 percent said they experienced cyber security threats , of which Internet fraud is the main concern .
The Cyberspace Administration of China released its first cyberspace security strategy in December 2016 , prioritizing cyberspace sovereignty ahead of the implementation of the Cyber Security Law , which takes effect in June 2017 .
The government will protect cyberspace sovereignty and national security , key information infrastructure and crack down on cyber terror and crimes , according to the strategy .
" More micro regulations will be formulated in 2017 after macro policies on cyber security were introduced last year ," Li said .
Li said he expects draft regulations on online shopping platforms , personal information protection and social media security .
Internet giants
Meanwhile , the report said the combined value of domestic Internet giants Tencent Inc and Alibaba Group Holdings surpassed 3 trillion yuan ($ 436.5 billion ), or 57 percent of all domestic public Internet firms .
Ninety-one domestic Internet companies are listed on domestic and overseas stock markets , valued at 5.4 trillion yuan as of December 2016 , according to the report .
Chinese companies ' adoption of information technology has quickly grown over the year , with Internet use reaching 95.6 percent in 2016 , up 6.6 percentage points from the previous year , the report said .