711.6 million Chinese people, which is 52.5% of the total population, will subscribe to the mobile communications service by 2010.

As of the end of December 2006, the number of mobile subscribers in China reached 443.57 million. The number of prepaid users in China was 284.05 million in 2006 and the number is forecasted to exceed 470 million by 2010.

The delay in 3G licenses became the most important issue in the Chinese mobile market during 2006. The leading mobile carrier, China Mobile has conducted tests for 3G and 3.5G and is ready to launch the services. China Unicom, the second largest carrier has also made considerable investments in 3G, and 3G licenses are likely to be issued at the end of 2007.

The two leading mobile carriers, China Mobile and China Unicom are engaged in fierce competition and are focusing on variety of services to increase their subscriber base. Both carriers are planning to introduce more dual-mode (GSM-GSM, CDMA-GSM)handsets in the market and China Mobile, who has the largest number of GSM subscribers, plans to export low-cost 3G handsets to overseas emerging markets.