The Chinese Ministry of Industry and Information Technology (MIIT) has disclosed that since the issuance of first three 3G licenses in early 2009, the number of 3G subscribers has been consistently rising and is anticipated to exceed the statistics of 10 Million by the end of 2009, as reported by Digitimes.

 

At the end of October 2009, the number of 3G users in China jumped to 9.77 Million and is projected to reach 80 Million by 2010. The stupendous expansion of subscribers’ base is accredited to the persistent development of the sector and improvement of network coverage. Chinese carriers have poured in substantial amount of money (102.3 Billion Yuan so far) in the widening of network coverage and providing better quality services to customers.

 

China Telecom has claimed that it completed the first stage network spreading by covering 342 prefecture-level cities, 2,055 county-level cities and counties and over 6,000 developed towns and villages through the establishment of 117,000 base stations.

 

High spending in the 3G segment will give impetus to the industry growth. 3G license holders might have invested 143.5 Billion Yuan (US$ 21 Billion) in building 3G infrastructure this year. Three major wireless carriers - China Telecom, China Mobile and China Unicom – have led the 3G spending in the country.

 

According to a research report “China Telecom Industry Forecast to 2012” by RNCOS, consumer spending on 3G terminals in China is anticipated to reach 400 Billion Yuan by 2011. Moreover, 3G audio-visual services will result in the consumption of 100-200 Billion Yuan by then.

 

Realizing the market potential, players are coming up with new strategies to enhance their profit. For example - Research in Motion Ltd. (RIM) will launch a customized BlackBerry for China, which will help it to expand business there.

 

According to a Research Analyst at RNCOS, “Chinese operators will need to work harder for grabbing a major chunk of 3G market. They need to work on strategies that encourage 2G customers to migrate towards 3G services. Low tariffs and easy availability of low cost 3G handsets could be an appropriate roadmap for the operators.”