The number of new fixed phone users remains at a low level. The number of new fixed phone users is 4.862 million, which makes the total number of fixed phone users, 372.673 million. Among them, the number of new fixed phone users in urban areas is 2.625 million bringing the total number in urban areas to 254.012 million; the number of users in rural areas is 2.236 million, which makes the total number in rural areas, 118.661 million. The number of wireless users declined by 576,000, making the total number of wireless users, 90.551 million. Its proportion to the number of fixed phone users is 24.3%, down 0.5 of a percentage point over the end of 2006.
Mobile phone user: since the second half in 2006, the number of new users has continued to grow month by month. Mobile phone users are increasing all the time. New users nationwide reached 40.566 million, which made the total number of mobile phone users, 501.64 million. It is predicted that this number will surpass 550 million in the second half of this year.
Internet user: More and more Internet users of basic telecom services have started to adopt broadband services. Users connecting to the Internet via dial tone declined by 4.809 million with the total number at 21.611 million. The number of newly subscribed broadband users reached 7.534 million with the total number of broadband users reaching 59.432 million.
The Communications industry continues to grow steadily. However, its growth rate has slowed down, indicating that China's telecom market has entered a stable growing adjustment period. According to the statistics of the Ministry of Information Industry, the total business volume of telecom industry reached 748.2 billion Yuan, up 26.1%; the total sales revenue of telecom services reached 351.62 billion Yuan, up 9.9%. In addition, the development of telecom services can be interpreted quite differently in terms of total business volume and sales revenue. The total business volume of telecom services grew 25.6% and 24.9% in 2005 and 2006 respectively to 26.1% in 2007, while its sales revenue declined 11.0% and 10.7% in 2005 and 2006 respectively to 9.9% in 2007. The gap between business volume and sales revenue of telecom services is widening.
As for communications services in the first half of 2007, both the number of fixed phone users and mobile phone users increased by a certain percentage from the previous year. Guided by the "New Rural Community" policy of the Chinese government, communications level in the rural areas increased very fast. Take fixed phone users as an example, the number of fixed phone users in urban areas increased 1.07% while the same number increased by 1.46% in rural areas. The increase of rural fixed phone users over that in urban areas indicates that a great achievement has been made after the promotion of a nationwide ''Extending Phone Coverage to Every Village'' Project, which started this year. However, more investment and effort need be made until communications services will becomes really popular in rural areas.
In the first half of 2007, numbers of fixed phone users in the east, west and central parts of China all increased by a certain degree. The growth rates of communications services over the same period in 2006 were 11.2%, 12.0% and 11.5% respectively. However, no sharp difference among the three regions had been seen in terms of the number of new fixed phone users. Meanwhile, what is worth noting is that the absolute difference between central and west China with east China has further broadened. The unbalanced regional development in China is still a difficult problem that still needs to be considered in China's communications market.
This year is a critical point in the telecom industry. This is because after resource integration and policy adjustment in 2005 and 2006, transformation conducted by carriers has been further intensified in 2007. This year is also the year when carriers decided to enhance their efforts in integrating various kinds of services. The restructuring of carriers is at the top of everyone's efforts in re-adjustment. The separate operation of C and G networks by China Unicom and the Competitive Cooperation Agreement signed between China Telecom and China Netcom have all be seen as the prelude of the restructuring of carriers. Though the cloud of restructuring of carriers have been always hanging over China's telecom market, the restructuring of carriers will certainly help to narrow the gap among the four largest carriers and further intensify competition in the 3G era so as to enhance the vitality of the telecom market. This will not only stimulate investment but also benefit consumers.
