China to top US in mobile use by end-2002

China will overtake the US as the market with the most active mobile users by the end of 2002, according to market research firm Gartner.

SINGAPORE--China will overtake the US as the market with the most active mobile users by the end of 2002, according to market research firm Gartner.

By then, China would have 166 million active mobile users compared with the US' 165 million, said Singapore-based Gartner's Asia Pacific director of Telecommunications & eBiz, Bertrand Bidaud, in a telephone interview yesterday.

Gartner defines active users as subscribers who "have made or received a billable call within the last three months".

Meanwhile, Japan is expected to maintain its third position with 74 million users next year compared with 67 million this year, added Australia-based Gartner principal analyst for mobile research Nick Ingelbrecht in a separate phone interview.

China is also expected to overtake the US in terms of mobile services revenue, "possibly around 2010", said Ingelbrecht. However, he could not provide specific figures due to the long forecast period.

According to him, China generated US$16.8 billion in mobile services revenue while the US generated US$63.2 billion last year.

Out of China's total revenue, 3.1 percent came from prepaid cards while the rest were from post-paid subscription. Ingelbrecht could not reveal a breakdown for the US mobile services market, but noted that the latter's post-paid revenue was "insignificant" compared with China's.

According to statistics released by China's Ministry of Information Industry (MII), the number of mobile phone users in the country was over 120.6 million as of July 31, 2001. This is compared with the US Cellular Telecommunications Industry Association's estimated 120.2 million users as of August 15 for the North American market.

Although these numbers suggest that China has overtaken the US in terms of the number of cell phone users, Gartner believes otherwise.

"We observed that the MII's cellular statistics do not discount inactive users and prepaid users with multiple SIM cards," Ingelbrecht said in a statement yesterday.

When asked about the number of multiple SIM card users in China, he noted: "(It's) difficult to put an accurate figure on this since this information is not reported. Users with multiple SIM are just one part of the group of inactive users, which runs into the millions."

Moreover, he observed that the MII report does not reveal the sales of mobile phones. "Sales by cellular operators to handset dealers have been counted as completed sales to end-users, and these have tended to anticipate sales ahead of the completion. Once these factors are taken into account, it can be deduced (from primary research and discussions with telecommunications vendors, carriers and government agencies in China) that actual subscribers are running behind reported connections by just over 16 percent on a national basis," he explained.