China is set to remain the world's largest broadband market after recently overtaking the US, Bill Gates, chairman and co-founder of Microsoft Corp, told a forum in Beijing.

"China has surpassed the US in the number of broadband users. And once this is the largest market, it will stay the largest market. There's an advantage to having 1.3 billion people," Gates said.

He noted that price constraints for fast, reliable Internet access were falling by the wayside.

"The price of broadband has been a limiting factor, but competition is bringing the price down," he said.

According to the China Internet Network Information Center, China had 104 million broadband users at the end of last year.

China, currently a global leader in hardware, would soon become a leader in software, he added.

"Innovation here is really growing at a rapid pace. I give a lot of credit here to the universities. China will be a leader ... it's already true for hardware, but it will also be true for software," Gates said.

He added that Microsoft had China's affection for mobile communications in mind when it recently signed a joint research deal with China's leading computer maker Lenovo.