Internet cafes were better for the spies, gangsters and terrorists than telephones. The web offered things the phone company never thought of offering. On the Internet you can encrypt your email so that even the CIA would require hours or weeks to decode it. The net also offered anonymizer sites that hid where your email was coming from. That way, whoever received your email did not know where you were when you sent it.
The police and intelligence agencies have the option of asking, persuading or forcing the caf operators to allow monitoring software to be placed on the caf's PCs. China can do this, as can many other nations. But in democracies, especially in Europe (where many terrorist organizations use as one large safe house), this is often not possible. At this point the situation gets murky. The FBI and CIA (and intelligence operations in many other nations) are known to possess and use hackers who can secretly plant monitoring software in Internet caf PCs. These programs look for certain types of messages, the use of encryption and so on and transmit it back to whoever planted the spyware. This sort of thing is illegal in most nations, but so is espionage by foreign nations. No one will admit this sort of thing is going on. And even if the spyware is found, if it is well put together, there will be no way to identify where it came from. The criminal underground has long been aware of the spyware angle, and are not as carefree as they used to be when they use Internet cafes.
Over a century ago, the telephone revolutionized espionage, criminal activities and terrorism, providing a widely available method of quickly sending and receiving messages. When pay phones eventually showed up, they were particularly favored, as they were anonymous and did not put any of a spy's associates in danger of discovery. History has repeated itself as the Internet and email quickly spread all over the planet. Although the cost of computers fell rapidly, even buying a second hand PC for a hundred dollars is more than over half the planet's population can afford. Because PCs got heavy coverage in worldwide print and electronic media over the last two decades, kids world wide know about it. By the late 1990s, everyone, world wide, wanted Internet access. So along came two things that made it possible; free email accounts and the Internet caf. Offering Internet access at rates local people could afford, thousands of Internet caf's opened up. This was seen as a somewhat subversive development by many totalitarian governments. China closed down many Internet cafes and regulated the rest. But even China backed off from banning the operations altogether.