The next generation of telecommunications will create an enormous market and challenge the dominant roles of current mobile operators.

"The 3G service will build a trillion yuan market within five years from its issuance," said Chen Jinqiao, director of the Ministry of Information Industry's Institute of Telecommunication Policy. Chen was attending the CeBIT Asia 2004 forum on Tuesday.

The Chinese 3G handset user population is expected to number between 351 million and 437 million in 2010. Monthly average revenue per 3G user is likely to hit 120 yuan (US$14.45).

Chen expects 3G technologies will create a 362.0 billion yuan market for mobile operators such as China Mobile Communications and China United Telecommunications. The market for telecommunication equipment providers and handset makers such as Nokia is forecast to rise to a whopping 660.6 billion yuan.

3G technologies allow users to exchange voice and image data much more quickly than the current mobile phone technologies, and will enable users to hold video teleconferences and watch TV or movies via their handsets.

China Mobile and China Unicom, the existing mobile operators, and China Telecommunications and China Netcom, the nation's two fixed-line phone operators, are expected to be granted 3G licenses by the ministry--the state-level IT regulator--next year.

"That will greatly change the current landscape of the mobile telecommunications market," said Chen. "No single carrier is expected to occupy more than 50 percent of the market in the 3G era."

China Mobile holds 65 to 70 percent of China's mobile telecommunications market by subscriber population, with China Unicom holding the balance now, according to Beijing-based CCID Consulting, a research arm authorized by the Ministry of Information Industry.

(eastday.com April 28, 2004)