China's telecommunications sector saw stable growth in 2005, with total revenues of 579.9 billion yuan (US$71.93 billion) and a 11.7 percent growth from the previous year, according to information published on the Ministry of Information Industry website on Tuesday.

The growth was partly driven by an increase of nearly 100 million subscribers last year. By the end of 2005, there were a total of 740 million phone users, including 350 million fixed line users and 390 million mobile users. The number of new fixed line users and mobile users were 38.68 million and 58.6 million respectively.

The penetration rate for fixed line services is 27 sets per hundred persons, and 30 sets per hundred persons for mobile services.

In 2005, there were about 12.63 million more users with access to broadband Internet services, bringing the total to 37.5 million.

According to statistics released by China Internet Network Information Center on January 17, China now has 111 million Internet users, the second highest in the world after the United States.

Short message service (SMS) remained a major contributor to telecom growth last year. About 304.65 billion messages were sent, an increase of 40 percent over the previous year, and total revenue surpassed 30 billion yuan (US$3.72 billion). In addition, other value-added services (VAS) like multimedia message service (MMS), ring tone downloads, and broadband Internet, also saw robust growth.

Due to the uncertainty of 3G policies last year, overall telecom investment was slashed by 4.8 percent to 203.34 billion yuan (US$25.22 billion). Experts believed that investments should rebound following the announcement of a national 3G standard and the implementation of 3G policies.

Su Jinsheng, director of the Telecom Management Bureau under the MII, outlined the bureau's aims for this year during a recent interview with People's Posts and Telecommunications News:

• Develop the layout for the 11th Five-Year Development Guidelines (2006-2010);

• Set up an evaluation system for basic telecom services, and boost the all-round operations of telecom service operators;

• Further improve policies and measures in the areas of industrial development, business coordination, market standards, resource allocation and inter-network settlement; and

• Research policies and measures for an enhanced opening-up of the telecom market, encourage and guide the private sector to play a greater role in telecom service, assist related departments to study policies developed after China's entry to the World Trade Organization so as to raise the sector's importance in the national economy.

As for the development of new technologies and businesses, Su highlighted a three-pronged approach:

First, keep close watch on new broadband access and application technologies, and carry out advanced research in this area.

Second, the bureau will evaluate pilot programs already conducted in the areas of 3G networks, Internet protocol television (IPTV) and ENUM (protocol for phone number mapping) for next-step development planning. 

In addition, the bureau will set up an exchange mechanism with key enterprises, and an information sharing mechanism with industry associations to keep abreast of the status of development of new technologies and businesses.

Third, the bureau will set up program models for enterprises, and strengthen the support for new businesses.

(China.org.cn by Tang Fuchun, January 27, 2006)