3G user spending three times above the average in ChinaBy Jon Russell Apr 06, 2011 12:00PM UTC
Research from technology analyst house ABI Research has shown that 3G mobile users spend three times the average monthly bill compared to other – feature phone – users (based on average revenue per user, ARPU).
From the ABI announcement on businesswire:
“3G is generally still viewed as a luxury service in China,” notes research associate Fei Feng Seet. “China Unicom reported its 2010 ARPU for WCDMA subscription at US$18.75 per month, which is three times the US$6 monthly ARPU for GSM.” Despite the launch of 3G networks, mobile consumers have not jumped into upgrading their subscriptions immediately as rapidly as in other markets. In fact over the past year, 2G has gained about 80 million subscribers.
China’s market, alongside India, remains a huge part of the global mobile market of which more than half is based in Asia:
According to ABI Research…mobile industry concluded 2010 with 5.5 billion subscriptions. The Asia-Pacific region accounted for a whopping 53% (2.9 billion) of the total. One-third of this can be attributed to India’s huge 2G market; another one-third to China.
Yet despite the huge numbers, 3G remains a nascent, niche of the country’s huge mobile market as ABI outlines:
As of December 2010, China had 860 million subscribers, although 3G subscriptions accounted for fewer than 50 million, or roughly 5.5%.
At the end of 2010, China Mobile’s TD-SCDMA subscriber base stood at more than 20 million, China Unicom’s WCDMA had 14 million subscribers, while China Telecom had more than 12 million CDMA subscribers.
Users of 3G are typically higher spenders, they tend to be more affluent and more likely to urban-based while also owning handsets with increased sophistication, which in turns leads to increased activity and spending for many users.
What is interesting is that 3G remains very new in China while the path for its successor, 4G, remains unclear as China’s own ‘brand’ TD-LTE 4G or an alternative FDD version of LTE may emerge – although ZTE and others continue to develop dual-band technology.
In relation to the ABI data, Apple was recently found to be the most desirable smartphone in China while China Mobile is confident it will get a TD-based iPhone 5 – both of which, combined with the growth in 3G, is likely to see Apple’s market share and revenues in China continue to rise.