No CDMA2000?
Monday March 19, 3:37 pm Eastern Time
Press Release
SOURCE: Strategis Group
World's Largest Cellular Market Roars Into 2001 With 6.8% Penetration Rate
Affluent Coastal Provinces to Drive Tremendous Growth Anticipated Over the Next Few Years
WASHINGTON, March 19 /PRNewswire/ -- China, today's largest cellular market in the world in terms of subscribers, has commonalities with some of the world's weakest cellular markets as well: a very low population penetration rate. While just 6.8% of China's population are cellular subscribers, The Strategis Group sees enormous potential for this burgeoning market. In a new study released by The Strategis Group, China Wireless Market, forecasts point to a compounded annual growth rate (CAGR) of 21.6% between 2000 and 2007, bringing the country's total cellular subscriber base to about 334 million by 2007.
``A large proportion of the expected growth will be driven by user adoption in large urban localities and the more affluent coastal provinces, as China is still a vast country of varying proportions,'' notes Oliver Tan, regional director of The Strategis Group, Asia Pacific Office. Based on provincial- level analysis, the study forecasts the Chinese cellular market to continue to experience high annual growth rates, driven by several key factors: a general decline in the cost of cellular service, market competition, rapid pre-paid user adoption, and the introduction of new and innovative services by operators. The Strategis Group estimates that the cellular base of 85 million subscribers as of end-2000 will grow by 41% to 120 million subscribers by the end of 2001, and 334 million by 2007.
China: 2G, 2.5G and 3G Subscribers (in millions) 2000 - 2007
1999 2000 2001 2002 2003 2004 2005 2006 2007
2G 38.1 84.9 118.1 150.8 182.0 209.4 234.4 255.7 274.3
2.5G - 0.3 1.2 3.8 8.6 16.6 25.2 33.6 39.0
3G - - - - - .9 3.6 9.8 21.0
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Totals 38.1 85.2 119.3 154.6 190.6 226.9 263.2 299.1 334.2
Source: The Strategis Group
The Strategis Group expects a steady erosion of the 2G subscriber base, falling from 97% of the total cellular market in 2000 to 82% by 2007. A corresponding increase in 2.5/3G subscriber shares is anticipated, from 0.3% of the market in 2000 to 18% in 2007. This is reflective of the world migration trends where 1G and 2G subscribers upgrade to either 2.5G or 3G compatible systems. While the operators have yet to stand firm on one particular 3G standard, The Strategis Group expects WCDMA to make the most headway, but may not be the only standard in China. Trials of TD-SCDMA are expected to begin this year.
China Wireless Market also shows that Internet penetration (through personal computers) continues to lag behind cellular penetration, and it is therefore highly likely that new Internet users will have their first Internet experience over wireless rather than wireline systems. ``This phenomena offers mobile Internet content providers and mobile service operators great growth prospects if they are able to develop competitive packages to encourage user adoption,'' states Poh Kwee Heng, senior analyst with The Strategis Group, Asia Pacific Office. ``The main challenge now is for them to continually innovate their services to ensure that there will always be compelling applications and rich content to remain appealing and relevant to users.''
The Strategis Group will hold a free conference call on Wednesday, March 28 at 2pm US EST, to discuss findings from the China Wireless Market study. Interested participants should contact Laura Wert at lwert@StrategisGroup.com or 202-530-7510.
The Strategis Group, a C7 company -- with offices in Washington, DC, London, Singapore, and Sao Paulo -- publishes in-depth market research reports, provides customized consulting services, and supplies continuous information solutions to the broadband, wireless, cable TV, satellite, Internet and competitive telephony industries. The Strategis Group's focus is pure telecommunications, providing strategic information to decision makers in the dynamic global marketplace. For more information on this report, please contact an account executive at 202-530-7500 (voice), 202-293-7933 (fax) or sales@StrategisGroup.com (email).
SOURCE: Strategis Group |
