The Industrial Internet, as a result of the deep integration of modern information technology and manufacturing, has emerged as one of the most significant trends in 2018. According to IDC data, the Chinese industrial internet market is projected to reach $127.5 billion by 2020, with a compound annual growth rate of approximately 14.7% between 2015 and 2020. This paper recommends the Industrial Internet Research Report from Founder Securities, which examines the field through three key dimensions: policy, technology, and industry. It outlines the logic behind the industrial internet in 2018 and highlights major domestic players. In January 2018, Guangdong Province launched the first industrial internet demonstration base. On February 24, the Ministry of Industry and Information Technology established a special working group focused on industrial interconnection. By February 27, the National Development and Reform Commission approved the country's first national-level industrial internet demonstration platform—Haier COSMOPlat. During the two sessions, Ma Huateng submitted eight written proposals advocating for the acceleration of industrial internet development to promote the transformation and upgrading of the real economy. As a core carrier of the transition from the consumer domain to the production domain and from the virtual economy to the real economy, the Industrial Internet connects the entire industrial system, supply chain, and value chain. It supports the infrastructure for intelligent industrial development. The promotion of the Industrial Internet plays a crucial role in advancing the integration of the internet and the real economy, fostering mass entrepreneurship, and driving the convergence of primary and secondary industries. It also contributes to building a strong nation and a cyber power. To this end, China has introduced several policy documents, such as "Made in China 2025," the "Internet +" action plan, and the Deepening of Manufacturing and Internet Integration Development Plan. These aim to leverage the combined, aggregated, and multiplied effects of China’s manufacturing and internet capabilities. Among these, the “Guiding Opinions on Deepening the Internet + Advanced Manufacturing Industry Development Industrial Internet,” issued in 2017, aligns with “Made in China 2025” and outlines the strategic deployment of China’s Industrial Internet of Things in three phases. The “323” action, which includes three major systems (network, platform, security), two types of applications (large-scale enterprise integration innovation and SME application popularization), and three forms of support (industry construction, ecological development, and internationalization), was proposed to drive industrial internet development. Miao Wei, Minister of the Ministry of Industry and Information Technology, emphasized that 2018 would be the first year of full implementation of the industrial internet construction, starting a three-year action plan from 2018 to 2020. Founder Securities believes that the industrial internet will be the biggest trend in 2018, comparable to the AI and semiconductor boom in 2017, but with broader coverage. The development of the industrial internet requires efforts from both the supply and demand sides, including cultivating industrial internet platforms, verifying their trials, encouraging SMEs to migrate to the cloud, and supporting the development of millions of industrial apps. Key technologies include digital twins, information physics systems (CPS), edge computing, OT+IT network integration, TSN (time-sensitive networking), 5G and IPv6, identification analysis technology, fog computing, test beds, and passive optical networks (PON). Each of these technologies plays a critical role in enabling the Industrial Internet and enhancing productivity and efficiency across various sectors. Major domestic players in the industrial internet include Alibaba Cloud ET Industrial Brain, Sany Heavy Industry Root Cloud, Aerospace Cloud Network INDICS, Haier COSMOPlat, Oriental Guoxin Cloudiip, Ming Smith Intelligent, Red Collar Mode, Foxconn BEACON, Inspur M81, Zhongkong supOS, Purple UNIPower, Xugong Xrea, Baoshen Industrial Internet Platform, Hande SRM Cloud, Huawei OceanConnect IoT, and China Mobile OneNET. These platforms are transforming traditional industries and enabling smart manufacturing across multiple sectors. In summary, as a product of the deep integration of information technology into the physical industry, the Industrial Internet has a relatively complete infrastructure, clear technological paths, and significant profit potential. According to Alibaba Cloud, if China’s manufacturing industry improves its yield by just 1%, it could generate billions of additional profits annually. In 2018, as the first year of the “323” industrial internet plan, policy dividends are expected to be frequent, platforms will expand rapidly, and traditional manufacturers will accelerate their transformation based on their core business.

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