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China's CDMA Base Drops for 3rd Successive Month
The Chinese mobile market surged past the 600m mark in September to finish the month with 607.17m connections. Monthly net additions stood at 7.89m, a long way from the record high of 9.46m in February 2008 but an improvement on the September 2007 figure of 7.64m.
After a six-month run of 8m + net additions in the first half of 2008 - with an average monthly gain of almost 9m, moreover - none of the past three monthly figures has made it over the 8m mark. It is tempting to link this downturn with the state of the global economy, but in fact the principal factor is more specific. China Unicom agreed the sale of its CDMA network to China Telecom in June, and since then it has seen three successive monthly declines to its CDMA subscriber base as it turns its attention away from this side of the business. In September, there was a net loss of 0.63m CDMA customers, the largest yet seen.
However, the total GSM customer base also saw something of a dip in growth in July and August with net additions of 8.06m and 8.08m respectively, the first sub-8.5m figures of 2008. Although the Olympics may have had some impact, with new mobile sign-ups banned in Olympic cities in August, it is more likely that this was simply the result of a slight cooling of growth following the extraordinary expansion (+53.52m customers) of the first half of the year.
The September figure appeared to demonstrate that this was not the start of a long-term slowdown, however. Net additions to the GSM base stood at 8.51m, up 16.9% on the year-earlier figure. China Unicom added 1.27m GSM customers, its second best figure of 2008, while China Mobile added 7.25m, up from 6.10m in September 2007. With 434.71m customers to Unicom's 172.46m, China Mobile remains utterly dominant and it saw its market share increase by 2.8pp annually to 71.6% at the end of September. Despite September's improvement, the July and August slump did have an impact on quarterly growth: the three-month gain of 3.97% represented an all-time low for the Chinese market.
Posted to the site on 23rd October 2008
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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