The Secret of the Chinese Mobile Market

In 2006, having 400 million users, China’s mobile market is the world’s No. 1 cell-phone market in size.

China’s mobile subscriber base exceeded 400 million in 2006, and mobile penetration is estimated to be slightly more than 30 percent, analysts say.

The analysts claim that the number of Chinese subscribers has reached 400 million with 30% of mobile penetration. Still the figures differ with various analysts. But the fact that is evident is that the numbers are constantly growing.

Forecasts:

• Informa Telecoms & Media - 600 million by 2007
• Wireless Intelligence - 509 million
• Gartner - 511 million
• Portio Research - 519 million

The Chinese market is a great magnet to operators, device manufacturers and content providers because of its size.

China research director at Gartner, Sandy Shen, claims that the growth of the market in China will come from agricultural and badly developed regions as well as from replacement sales.

At the moment SMS is the most popular mobile usage, although the new application are coming such as 2D barcode, instant messaging, GPS. Shen said that NFC (near-field communication) is also coming soon.

Although the practical benefit of 2D barcode and NFC is incredible, the penetration of the technologies is a long and gradual process due to the “”fragmentation of the technology and phone platforms, and complications in the business model.”

Shen stressed the fact the major portion of the revenue up to 2010 will come from SMS and ringtone services

The analyst explained that SMS and ringtone services are easy to use, moreover, they are more affordable than high-end applications. The fact is true, SMS can be used on all types of mobile devices and at the moment all the providers support such service.

Portio Research claims that China market is the world’s leading one in respect for SMS with over 451 million SMS sent in 2006 (more than 67% increase compared to 2005).

The whole world is waiting how China will react to the introduction of the homegrown 3G standard TD-SCDMA.

Sandy Shen commented:

“This will indicate how successful [or not] the technology will be, and when the official 3G licenses will be issued. After that, we will see other 3G technologies like W-CDMA and CDMA2000 being deployed and compete with TD-SCDMA.”

Shen expects the development of the mobile network to cause some kind of industry reorganization. For instance, she says that it is unlikely that China Unikom will control both CDMA and GSM networks.

China Unikom and China Mobile are the two major mobile operators in the country (with China Mobile having 67.9% share of the market).

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Technorati Tags: mobile web, mobile Internet, mobile adds, mobile advertisement, mobile software, mobile web site, mobile web 2.0, mobile web page, mobile internet service, mobile internet access, mobile wireless internet, advertising mobile

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