Na­tion be­com­ing top mo­bile phone mar­ket

China Daily (Canada) - - BUSINESS - By GAO YUAN gaoyuan@chi­

China will be­come the world’s largest mo­bile phone mar­ket by rev­enue for the first time by year end, over­tak­ing the United States, an in­dus­try re­port said. In­ter­net gu­ruMaryMeeker has iden­ti­fied the coun­try as the most mo­bile na­tion in the world.

Phone sales will reach $87 bil­lion in China dur­ing 2014, a jump of 53 per­cent year-onyear. That com­pares with $60 bil­lion pro­jected sales in the US, Strat­egy An­a­lyt­ics said.

Smart­phones dom­i­nate sales. Chi­nese shop­pers will buy more than 400 mil­lion smart­phones this year, ac­cord­ing to lo­cal re­search com­pany Analysys In­ter­na­tional. The amount is on track to break 500 mil­lion by 2016, it said.

Meeker ac­knowl­edged China’s role in the global mo­bile In­ter­net sec­tor. The world’s sec­ond-largest econ­omy is mov­ing swiftly to be­come a leader in mo­bile com­merce, helped with ap­pli­ca­tions in­stalled on smart­phones, ac­cord­ing to Meeker. She is a part­ner at ven­ture cap­i­tal firm Kleiner Perkins Cau­field & Byers.

As of last year, more than 500 mil­lion Chi­nese were us­ing mo­bile de­vices — pri­mar­ily smart­phones — to con­nect to the In­ter­net, ac­cord­ing to the China In­ter­net Net­work In­for­ma­tion Cen­ter. The pen­e­tra­tion rate of mo­bile In­ter­net users rose to a record 81 per­cent in 2013.

China beat the US in terms of smart­phone ship­ments in 2012.

The growth in mo­bile de­vices MO­BILE PHONE MAR­KET BY COUN­TRY is driven by the coun­try’s rapid shift to fourth-gen­er­a­tion telecom­mu­ni­ca­tions tech­nolo­gies, an­a­lysts said.

Leading play­ers, such as Sam­sung Elec­tron­ics Co, Huawei Tech­nolo­gies Co Ltd and Len­ovo Group Ltd, have pledged to ex­pand their dis­tri­bu­tion chan­nels, and a widen­ing prod­uct of­fer­ing is di­ver­si­fy­ing de­mand in China.

Al­though China leads the global mo­bile phone mar­ket in many ways, the Strat­egy An­a­lyt­ics re­port said theUS is most likely to re­main the most valu­able mar­ket by profit for a while.

“High aver­age sell­ing prices and huge op­er­a­tor sub­si­dies will­make theUS a very prof­itable mar­ket for ma­jor de­vice brands such as Ap­ple and Sam­sung,” it said.

The world’s leading smart­phone brands may find it dif­fi­cult to main­tain a high growth rate in China, where an­a­lysts said the high dou­bledigit ex­pan­sion may be near­ing its end. Ad­di­tion­ally, lo­cal play­ers are vig­or­ously ex­pand­ing businesses on their home turf.

Len­ovo, bet­ter known for its PC busi­ness out­side China, is bet­ting on smart­phones for fu­ture profit. The Bei­jing­based com­pany be­came the sec­ond-largest smart­phone ven­dor in China by the end of the first quar­ter, data from Analysys In­ter­na­tional showed. Its 12.3 per­cent mar­ket share only lags be­hind Sam­sung.

Cool­pad— Yu­long Com­puter Telecommunication Sci­en­tific (Shen­zhen) Co Ltd — as well as Huawei and Xiaomi Corp en­joyed near dou­bledigit mar­ket share and Ap­ple’s share dropped to less than 7 per­cent.

BryanWang, China head at con­sul­tancy For­rester Re­search Inc, said 4G is a nec­es­sary fea­ture for com­pa­nies such as Xiaomi to put into their port­fo­lio as Chi­nese are ea­ger for faster In­ter­net speeds.


Smart­phones are ad­ver­tised at a China Mo­bile Ltd store in Shang­hai. Chi­nese shop­pers are ex­pected to buy more than 400 mil­lion smart­phones this year and the amount is on track to break 500 mil­lion by 2016, Analysys In­ter­na­tional said.

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