The Chinese Ministry of Information Industry has predicted that by the end of 2004, the Chinese mobile phone penetration rate will have reached 24.5 percent - or one mobile phone for every four people.
According to the Ministry, the Chinese mobile industry is booming, driven by new technology and demand, with revenue from mobile communications close to half that of overall communications operations.
In the first four months of this year, another 2.7 million new mobile phone users were added, taking the total number to 295.7 million. By the end of 2004, according to the Ministry, this number will top 300 million.
SMS (short message services) is growing exponentially and has become the most profitable operation. SMS and ringtone providers have created a trend of small applications driving significant profits.
The Chinese mobile phone penetration rate is 20.8 percent out of a population of 1.3bn population, leaving plenty of room for growth. But 0.8bn people live in inaccessible areas, which may need a different marketing approach that includes more flexible pricing. In Europe, mobile phone penetration is between 60 percent and 70 percent. In the USA, it is 50 percent, while Japan, Korea and Singapore have 60 percent, 70 percent and 80 percent respectively.