China continues to build a substantial world-class telecommunications infrastructure and the investments show no sign of abating. As data traffic grows, the major operators are keeping pace by increasing both domestic and international connectivity through submarine and terrestrial cable links. The country also has high aspirations with its space program and has developed a local industry to develop, build and deploy communications satellites. China is at the forefront of technology development, strongly supported by all levels of government. Amongst these initiatives are cloud computing and smart grid deployments and the building of smart cities that support the government’s climate change targets set out in the 12th Five Year Plan.

1. China – Telecoms, Mobile, Broadband and Forecasts
The China market still has low penetration rates and this is an excellent indicator for future
growth. The report covers trends and developments in telecommunications, mobile,
internet, broadband, digital TV and IPTV developments. Subjects include:
Market and industry analyses, trends and developments;
Facts, figures and statistics;
Industry and regulatory issues;
Infrastructure;
Major players, revenues, net profit, EBITDA, subscribers, ARPU;
Internet, VoIP, IPTV;
Mobile voice and data markets;
Broadband (FttH, DSL, cable TV, mobile);
Digital media;
Smart cities;
Cloud computing;
Smart grids;
Forecasts for internet users, fixed-line, mobile, 3G, broadband, FttX and cable subscribers
to 2016.
China outperformed all other major economies in 2010 with GDP growth over 10%. The
government vowed, in the 12th Five-Year Plan released in March 2011, to continue
reforming the economy and emphasised the need to increase domestic consumption in
order to make the economy less dependent on exports for GDP growth.
Buy Now: China Telecoms, Mobile, Broadband and Forecasts Market
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According to the International Monetary Fund, China’s share of worldwide GDP is to grow
from 1.7% in 1991 to 11% in 2014. This highlights the massive change underway in China.
Telecommunications is an important vehicle to drive through this radical shift in economic
prosperity and culture.
China’s entire telecommunications market generated around US$140 billion in 2010
contributing around 3% to GDP. It is the second largest telecoms services market in Asia
Pacific after Japan. The market is expected to increase at a compound annual growth rate of
8.8% between 2009 and 2014, reaching US$187 billion by 2014, surpassing Japan as the
largest telecommunications market in Asia.
The market experienced a settling in period after the government initiated industry
restructure in 2008. China Mobile is still the dominant player but the 3G space sees a more
equitable distribution of market share. The mobile sector is still expanding at over 15% per
annum and 3G services are starting to gain momentum supported by a more mature value
chain. Confronted with a continuous decline in the fixed-line market, the government has
again intervened to set aggressive targets for broadband services. China became the
leading country in the number of digital subscriber line users in 2003 and by 2010 was the
leading country in terms of FttX deployment.

2. There is rapid development of internet businesses in China as the digital economy takes
shape. The pace of development has escalated as more and more of the population gain
access to the internet. Chinese based online enterprises can target consumers like no
western company has been able to do and numerous successful initial public offerings on
the NYSE into 2011 are testament to this. Internet users are approaching the 500 million
mark, increasingly accessing web sites via mobile phones.
China continues to build a substantial world-class telecommunications infrastructure and the
investments show no sign of abating. As data traffic grows, the major operators are keeping
pace by increasing both domestic and international connectivity through submarine and
terrestrial cable links. The country also has high aspirations with its space program and has
developed a local industry to develop, build and deploy communications satellites.
China is at the forefront of technology development, strongly supported by all levels of
government. Amongst these initiatives are cloud computing and smart grid deployments
and the building of smart cities that support the government’s climate change targets set
out in the 12th Five Year Plan.
Market highlights:
China had close to 1,200 million phone users by mid-2011, including mobile phones, fixed-
line phones and PHS handsets. Mobile subscribers comprised over 75% of the total.
Non-voice revenue comprised 40% of total industry revenue and value-added services
comprised 25% of total industry revenue.
Internet access conditions improved in rural areas as more provinces and municipalities
moved into the first echelon of internet development.
Broadband investments increased particularly with FttX infrastructure, driven by
government initiatives.
Nascent IPTV growth was impacted by the government announcement of three-network
integration trials of the country’s telecom, broadcast television and internet networks.
Mobile TV was introduced using the local China Multimedia Mobile Broadcasting mobile TV
standard.
Large scale LTE trials were started even though 3G deployments still have to reach critical
mass, and government statements that 4G operations will only be approved in 2014.
Table of Contents
1. Key Statistics
2. Telecommunications Market
2.1 Country Overview
2.1.1 Background
2.1.2 China’s economy
2.2 Telecommunications market progression
2.2.1 Background of China’s telecom market
2.2.2 China’s telecom market restructure in 2008
2.2.3 Overview of China’s telecom market – 2008-2010
2.3 Telecommunications market sectors
2.3.1 Fixed lines and mobiles
2.3.2 Internet and broadband
3. Regulatory Environment
3.1 Overview

3. 3.2 Tenth Five-Year Plan (2000-2005)
3.3 Eleventh Five-Year Plan (2006-2010)
3.4 Twelfth Five-Year Plan (2011-2015)
3.5 E-government
3.5.1 Government e-commerce projects
3.6 Ministry of Industry and Information Technology (MIIT)
3.6.1 Ministry of Information Industry (MII)
3.6.2 MII Expansion
3.6.3 Ministry of Industry and Information Technology (MIIT)
3.7 China Internet Network Information Centre
3.8 World Trade Organisation accession
3.9 Regulatory developments: 2010-2011
3.9.1 Roaming and long-distance fees simplified
3.9.2 Draft Telecom Law review
3.9.3 Industry Standards updated
3.9.4 Internet information watchdog established
4. Fixed Network Market
4.1 Overview
5. Major Operators
5.1 Overview of industry restructure
5.1.1 Restructuring of the telecommunications operators: 1993-2001
5.1.2 Industry restructure: 2002-2007
5.1.3 Drivers for business restructuring in China – 2007
5.1.4 Industry restructure – 2008
5.1.5 Newly formed entities – 2008
5.2 China Mobile Ltd (CML)
5.2.1 Company overview
5.2.2 Company background
5.2.3 China Mobile: Financial statistics
5.2.4 China Mobile: Operations statistics
5.2.5 China Mobile: Business operations strategies
5.2.6 China Mobile investments and the development of m-commerce
5.2.7 China Tietong (merged into China Mobile)
5.3 China Telecom
5.3.1 Company overview
5.3.2 Company background
5.3.3 China Telecom: Financial statistics
5.3.4 China Telecom: Operations statistics
5.3.5 China Telecom: Business operations strategies
5.3.6 China Satcom (merged into China Telecom)
5.4 China Unicom
5.4.1 Company overview
5.4.2 Network capacity
5.4.3 Company background
5.4.4 China Unicom: Financial statistics
5.4.5 China Unicom: Operations statistics
5.4.6 China Netcom (merged into China Unicom)

4. 6. Telecommunications Infrastructure
6.1 Infrastructure developments in China
6.2 International infrastructure
6.2.1 Terrestrial and submarine cable infrastructure
6.2.2 Satellite infrastructure
6.3 Other infrastructure developments
6.3.1 Climate change in China’s 12th five year plan
6.3.2 Smart cities
6.3.3 Forming a silicon delta in Guangdong, Hong Kong and Macau
6.3.4 Moving up the value chain
6.4 Smart grids
6.4.1 Smart grids – background
6.4.2 Electricity growth projections for China
6.4.3 Smart grids – China investments
6.4.4 State Grid Corporation
6.4.5 Smart grids – China policy
6.4.6 Smart grids – industry standardisation
6.4.7 Smart grids – Anhui Province
6.5 Cloud computing
6.5.1 Background
6.5.2 Market size
6.5.3 Cloud computing investments and deployments
7. Internet Market
7.1 Backbone internet networks
7.1.1 ChinaNet Next Carrying Network (CN2)
7.2 International outlet bandwidth
7.3 Basic internet resources
7.4 IP Addresses
7.5 Domain names
7.6 Websites
7.7 Web pages
7.8 Internet growth
7.8.1 Background
7.8.2 China internet user statistics
8. Broadband Market
8.1 Overview
8.2 Broadband statistics
8.2.1 Operator broadband subscribers
8.2.2 Broadband subscribers by access type
8.3 Broadband technologies
8.3.1 Overview
8.3.2 Cable modems
8.3.3 Digital subscriber line (DSL)
8.3.4 Fibre-to-the-home (FttH)
8.4 Wireless broadband
8.4.1 Wireless local area networks (WLANs)

5. 8.4.2 WiFi
8.4.3 World Interoperability for Microwave Access (WiMAX)
8.4.4 Multi-carrier Wireless Internet Local Loop (McWiLL)
8.4.5 Wireless Authentication and Privacy Infrastructure (WAPI)
8.5 IP telephony/Voice over Internet Protocol (VoIP)
8.5.1 Market overview
9. Digital Media / Digital Economy
9.1 Digital Media
9.1.1 Overview
9.1.2 Online advertising and marketing
9.1.3 Television broadcasting
9.2 Digital Economy
9.2.1 E-Services Overview
9.2.2 E-Commerce
9.2.3 E-Entertainment
9.2.4 Information acquisition
9.2.5 Commercial exchange
9.2.6 Web entertainment
9.2.7 Exchange and communication
9.2.8 OnLine companies
10. Mobile Communications
10.1 Overview of China’s mobile market
10.2 Mobile statistics
10.2.1 Mobile subscribers 1995-2012
10.2.2 Mobile subscribers by operator
10.2.3 Prepaid cards (SIM and PIM cards)
10.2.4 Mobile talk time
10.3 Mobile technologies
10.3.1 PAS/PHS (Little Smart/Xiaolingtong)
10.3.2 GSM
10.3.3 General Packet Radio Service (GPRS)
10.3.4 Enhanced Data for GSM Evolution (EDGE)
10.3.5 CDMA
10.3.6 HSPA+
10.4 Third Generation (3G) mobile
10.4.1 Background
10.4.2 3G Licences
10.4.3 3G Investments
10.4.4 3G developments
10.4.5 3G statistics
10.5 3G technologies
10.5.1 TD-SCDMA
10.5.2 WCDMA
10.5.3 CDMA2000
10.6 Fourth Generation (4G) mobile
10.7 Mobile number portability (MNP)
10.8 Mobile handset market

6. 10.8.1 Overview
10.9 Mobile data services
10.9.1 Short Message Service (SMS)
10.9.2 Wireless Application Protocol (WAP)
10.9.3 Multimedia Messaging Service (MMS)
10.9.4 Push-to-Talk (PTT)
10.10 Mobile TV
10.10.1 Overview
10.10.2 Market size
10.10.3 Mobile TV standards
10.10.4 Mobile TV developments
10.11 Mobile applications
10.11.1 Market overview
10.11.2 M-commerce
10.11.3 M-payment
10.11.4 Mobile gaming
10.11.5 Instant Message (IM) search services
10.11.6 Mobile music
10.11.7 Mobile internet
11. Forecasts
11.1 Forecast fixed-line subscribers – 2011-2016
11.2 Forecast: Mobile subscribers 2010-2012; 2016
11.2.1 Forecast: Total mobile subscribers 2010-2012; 2016
11.2.2 Forecast: 3G mobile subscribers
11.3 Forecast internet users – 2011-2016
11.4 Forecast broadband subscribers – 2010-2016
11.5 Forecast FttX subscribers – 2010-2016
11.6 Forecast cable TV market – 2010-2015
11.7 Forecast digital cable TV market – 2010-2015
12. Glossary of Abbreviations
List of Tables
Table 1 – Country statistics – 2011
Table 2 – Telecom revenue and investment statistics – 2010
Table 3 – Telephone network statistics – April 2011
Table 4 – Internet user statistics – December 2010
Table 5 – Broadband statistics – April 2011
Table 6 – Mobile statistics – April 2011
Table 7 – National telecommunications authorities
Table 8 – Percentage share of global GDP – 1991, 2014
Table 9 – China GDP growth – 2006 – 2015
Table 10 – Telecommunications investment in fixed assets – 2006 – 2010
Table 11 – Value added services telecom business revenue – 2006 – 2010
Table 12 – Fixed-line and mobile subscriptions and penetration rate – 1998 – 2012
Table 13 – Fixed-line local telephone calls – 2006 – 2010
Table 14 – Fixed-line traditional long-distance telephone calls – 2006 – 2010
Table 15 – China’s telephone subscribers fixed versus mobile overview – 1998 – 2012
Table 16 – Product ownership in households: 2005; 2009

7. Table 17 – Fixed-line local telephone calls – 2006 – 2010
Table 18 – Fixed-line traditional long-distance telephone calls – 2006 – 2010
Table 19 – China Mobile revenue, capex, EBITDA margin, net profit – 2000 – 2010
Table 20 – China Mobile VAS revenue breakdown (selected items) – 2006 – 2010
Table 21 – China Mobile revenue composition of value added business – 2006 – 2010
Table 22 – China Mobile capex – 2008 – 2013
Table 23 – China Mobile subscribers, annual change, ARPU and market share – 1997 – 2010
Table 24 – China Mobile voice usage – 2006 – 2010
Table 25 – China Mobile key operating data – 2008 – 2010
Table 26 – China Mobile Advanced services usage – 2007 – 2010
Table 27 – China Mobile advanced services by subscription – 2008 – 2009
Table 28 – China Mobile advanced services by subscription – 2010
Table 29 – China Telecom financial data – 2001 – 2010
Table 30 – China Telecom revenue breakdown – 2008 – 2010
Table 31 – China Telecom wireline revenue breakdown – 2007 – 2010
Table 32 – China Telecom capex breakdown – 2008 – 2010
Table 33 – China Telecom fixed-line, PHS and broadband subscribers and ARPU – 2004 –
2010
Table 34 – China Telecom mobile and 3G subscribers and ARPU – 2002 – 2010
Table 35 – China Telecom key operational statistics – 2007 – 2010
Table 36 – China Unicom financial data – 2001 – 2010
Table 37 – China Unicom mobile and fixed-line service revenue structure – 2009 – 2010
Table 38 – China Unicom mobile and fixed-line voice and non-voice revenue – 2008 – 2010
Table 39 – China Unicom mobile service revenue 2G and 3G – 2009 – 2010
Table 40 – China Unicom capex breakdown – 2007 – 2011
Table 41 – China Unicom GSM mobile subscribers – 2002 – 2010
Table 42 – China Unicom key operating metrics – 2007 – 2010
Table 43 – China Netcom subscribers by service – 2003 – 2008
Table 44 – China Netcom ARPU by sector – 2003 – 2008
Table 45 – China Netcom revenue percentages – 2003 – 2008
Table 46 – China Netcom financial data – 2003 – 2008
Table 47 – China Netcom traditional and innovative revenue ratios – 2005 – 2008
Table 48 – China main indicators of telecommunications capacity – 2009 – 2011
Table 49 – China total international outlet bandwidth: 2006 – 2010
Table 50 – International outlet bandwidth for key networks – 2004 – 2010
Table 51 – IPv4 address resources in China and annual change – 2005 – 2010
Table 52 – Total domain names in China and annual change – 2005 – 2010
Table 53 – Classified domain names in China – 2009 – 2010
Table 54 – Classified .cn domain names – 2009 – 2010
Table 55 – Growth of websites in China and annual change – 2002 – 2010
Table 56 – Growth of web pages in China and annual change – 2006 – 2010
Table 57 – Internet users and annual change – 1996 – 2012
Table 58 – Internet subscribers and annual change – 1996 – 2012
Table 59 – CNNIC internet statistical survey – 2009 – 2010
Table 60 – Comparison in age structure of China internet users – 2008 – 2010
Table 61 – Broadband subscribers, annual change and penetration – 2000 – 2012
Table 62 – Broadband subscribers and households – April 2011
Table 63 – China Telecom broadband subscribers and annual change – 2003 – 2011
Table 64 – China Unicom broadband subscribers and annual change – 2003 – 2011

8. Table 65 – Broadband subscribers and growth by access type – April 2010
Table 66 – Forecast broadband subscribers and household penetration – higher band: 2011
– 2012; 2016
Table 67 – Cable modem internet subscribers and annual change – 2000 – 2010
Table 68 – DSL internet subscribers – 2000 – 2011
Table 69 – FttX subscribers – 2006 – 2012
Table 70 – Growth in IP telephony in China – 2004 – 2010
Table 71 – Registered Tom-Skype users in China – 2005 – 2009
Table 72 – China media market revenue – 2002 – 2009
Table 73 – China advertising market revenues in major media – 2001, 2010, 2012 (e)
Table 74 – Overview of cable TV market – December 2010
Table 75 – Cable TV subscriptions and annual growth – 1996 – 2012
Table 76 – Digital cable TV subscribers and penetration rate – 2002 – 2012
Table 77 – Digital pay TV subscribers – 2005 – 2009
Table 78 – Reception devices connected to main television set – 2008
Table 79 – IPTV subscribers – 2004 – 2012
Table 80 – Estimated value of B2C e-commerce market – 2005 – 2012
Table 81 – Estimated value of C2C e-commerce market – 2005 – 2012
Table 82 – Online activities by percentage of users – 2009
Table 83 – Utilisation rate and number of users of different network applications in China –
2009 – 2010
Table 84 – Market share of online search engines – 2005 – 2010
Table 85 – Search engine users – 2007 – 2010
Table 86 –Online search advertising market – actual: 2005 – 2014
Table 87 – China online retail market revenue and customers – 2003 – 2012
Table 88 – Online banking users and utilisation rate – 2007 – 2010
Table 89 – Online gaming revenues – 2004 – 2012
Table 90 – Online gamers users – 2007 – 2010
Table 91 – Online video users – 2007 – 2010
Table 92 – Online music users and utilisation rate – 2007 – 2010
Table 93 – Instant messaging users and utilisation rate – 2007 – 2010
Table 94 – China’s top 15 social networks – March 2011
Table 95 – China’s SNS market share and user loyalty – 2010
Table 96 – Mobile subscribers and annual change – 1995 – 2012
Table 97 – Mobile subscribers by operator and annual change – March 2011
Table 98 – Prepaid mobile subscribers by operator – September 2010
Table 99 – China Unicom postpaid versus prepaid mobile subscribers by network – 2004 –
2010
Table 100 – China Mobile postpaid versus prepaid mobile subscribers – 2004 – 2010
Table 101 – Mobile talk time – 2006 – 2010
Table 102 – Little Smart (PHS) subscribers – 2002 – 2011
Table 103 – China Telecom CDMA subscribers pre/postpaid, MOU and ARPU – 2002 – 2010
Table 104 – China Telecom CDMA network statistics – December 2010
Table 105 – HSPA+ and LTE downlink peak data rates
Table 106 – 3G subscribers in China – 2008 – 2012
Table 107 – China Mobile – TD-SCDMA datacard packages – May 2011
Table 108 – 3G usage fee comparison – April 2009
Table 109 – Mobile phones manufactured in China – 2004 – 2010
Table 110 – Mobile data revenues – top three countries – 2009

9. Table 111 – China Mobile mobile data service user growth – 2004 – 2010
Table 112 – China Mobile and China Unicom mobile VAS revenue – 2009
Table 113 – China Mobile and China Unicom mobile VAS revenue – 2010
Table 114 – China Mobile value-added business revenue breakdown – 2006 – 2010
Table 115 – Growth of text messages (SMS) in China and annual change – 2000 – 2010
Table 116 – China Mobile SMS usage volume and annual change – 2003 – 2010
Table 117 – Leading mobile value added services by subscribers and penetration – 2010
Table 118 – Mobile internet subscribers and annual change – 2006 – 2010
Table 119 – Mobile internet use in China – 2008 – 2010; USA and Japan – 2009
Table 120 – Mobile internet use among urban Chinese youth – 2008 – 2010; USA and Japan
urban youth – 2009
Table 121 – Forecast fixed-line subscribers and penetration – lower band: 2011 – 2012;
2016
Table 122 – Forecast fixed-line subscribers and penetration – higher band: 2011 – 2012;
2016
Table 123 – Forecast mobile subscribers and penetration lower band forecast – 2011 –
2012; 2016
Table 124 – Forecast mobile subscribers and penetration higher band forecast – 2011 –
2012; 2016
Table 125 – Forecast 3G mobile subscribers and share of mobile market – 2011 – 2012,
2016
Table 126 – Forecast internet users and penetration – lower band: 2011 – 2012; 2016
Table 127 – Forecast internet users and penetration – higher band: 2011 – 2012; 2016
Table 128 – Forecast broadband subscribers and household penetration – lower band: 2011
– 2012; 2016
Table 129 – Forecast broadband subscribers and household penetration – higher band:
2011 – 2012; 2016
Table 130 – Forecast FttX subscribers and penetration: 2011 – 2012, 2016
Table 131 – Forecast cable TV subscribers and household penetration: 2011 – 2012; 2015
Table 132 – Forecast digital cable TV subscribers and percentage of cable TV subscribers:
2011 – 2012; 2015
List of Charts
Chart 1 – China revenue breakdown fixed/mobile; voice/non-voice – 2010
Chart 2 – China revenue breakdown fixed/mobile; voice/non-voice – 2006 – 2010
Chart 3 – China fixed-line and mobile subscribers – 1998 – 2012
Chart 4 – Fixed-line local telephone calls – 2006 – 2010
Chart 5 – Fixed-line traditional long-distance telephone calls – 2006 – 2010
Chart 6 – Internet penetration rate of key countries – June 2010
Chart 7 – Fixed-line local telephone calls – 2006 – 2010
Chart 8 – Fixed-line traditional long-distance telephone calls – 2006 – 2010
Chart 9 – China Mobile revenue, capex, ARPU – 2000 – 2010
Chart 10 – China Telecom revenue, capex, broadband ARPU, mobile ARPU – 2004 – 2010
Chart 11 – China Unicom revenue, capex, mobile ARPU – 2002 – 2010
Chart 12 – China Unicom subscriber data – mobile, fixed-line, broadband – 2007 – 2010
Chart 13 – China total international outlet bandwidth – 2006 – 2010
Chart 14 – IPv4 address resources in China and annual change– 2006 – 2010
Chart 15 – Websites in China and annual change– 2002 – 2010
Chart 16 – Web pages in China and annual change– 2006 – 2010

10. Chart 17 – Number of internet users and growth rate in China – 2002 – 2012
Chart 18 – Comparison in age structure of China internet users – 2009 – 2010
Chart 19 – China broadband subscribers and household penetration – 2002 – 2012
Chart 20 –Cable TV subscribers and digital TV penetration – 1996 – 2010
Chart 21 – China mobile subscriber growth, population penetration – 2000 – 2012
Chart 22 – China operator market share 2G vs 3G – March 2011
Chart 23 – Leading mobile value added services by subscribers and penetration – 2010
Chart 24 – China subscriber reasons for using the mobile internet
Chart 25 – China popular mobile internet applications – June 2010
List of Exhibits
Exhibit 1 – Map of China
Exhibit 2 – Telecommunications industry statistics – 2006 – 2007
Exhibit 3 – Restructuring of China’s telecommunications industry
Exhibit 4 – Telecommunications industry statistics from the MIIT – 2008 – 2010
Exhibit 5 – China’s agreed schedule for telecom liberalisation – 2002 – 2007
Exhibit 6 – Restructuring Scenario 1
Exhibit 7 – Restructuring Scenario 2
Exhibit 8 – Restructuring Scenario 3
Exhibit 9 – China Mobile Limited at a glance – December 2010
Exhibit 10 – China Telecom Corporation Ltd at a glance – December 2010
Exhibit 11 – China Unicom Ltd at a glance – December 2010
Exhibit 12 – China Network Communications Group Corporation (Hong Kong) Limited at a
glance – H1 2008
Exhibit 13 – Regional/international fibre optic cable networks
Exhibit 14 – Selected Chinese satellite service providers and satellites
Exhibit 15 – China Satcom satellite fleet
Exhibit 16 – Types of telecom convergence
Exhibit 17 – BesTV Corporation
Exhibit 18 – Jiangsu IPTV application
Exhibit 19 – Overview of ‘eye will’
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