The mobile markets of the Asia Pacific region continues to grow in importance. In Issue 99, we reported the fact that at the end of September, there were 20 networks in the world with more than 30m customers, of which eight were in this region. Those eight included the two largest - China Mobile and China Unicom - as well as the seventh, eighth, tenth, twelfth, 13th and 20th. Just three months later, there are now 23 networks that have passed the 30m mark and nine of these are now in the AsiaPac region, including four from India. Of the nine, four now have over 50m customers, the other two outside China being Bharti from India and DoCoMo from Japan. Together, the nine have a total of 831m customers, or just under 25% of the global market.

For the foreseeable future, the top two places in the table will remain unchanged, with China Mobile way out ahead of the rest of the field. It ended 2007 with a massive 368m customer base - more than the next five operators put together. It continues to increase its lead over Unicom and had more than 200m more customers than its closest rival, which in turn ended the year with 162.5m, of which 120.6m used GSM and the balance - 41.9m - CDMA. Assuming the proposed restructuring of the Chinese market goes ahead, these numbers would be enough to allow Unicom's GSM business to retain second place, while its CDMA side would be sixth - but in danger of dropping down the order.

Indian operators advance

The main challengers are all from the Indian subcontinent and most especially, India itself. The rapid growth here has created a number of changes amongst the lower orders, involving no fewer than eleven of the top 20 operators. The largest gain was made by Bharti, which has risen to third place in the region (and sixth in the world) with a total of 55.2m customers at the end of December. Preliminary numbers for March suggest that in our next review of the global rankings, it will have moved up to fifth, overtaking MTS of Russia.

Bharti took third place in the Asia Pacific rankings from DoCoMo, which continues to report a slow growth rate, as it loses market share in Japan to both KDDI and the recently revived Softbank Mobile, the former Vodafone Japan. DoCoMo added over 2m W-CDMA customers during the quarter, but lost 1.8m second generation PDC connections, leaving it with net growth of just 209k. Its fourth place looks safe enough for a couple of quarters, but not much more, as it seems likely that Telkomsel from Indonesia will overtake it before the end of this year. Indeed, given its current growth rate, Vodafone India will also overtake it in the same time frame. Assuming each of the three achieves the same growth in 2008 as they did in 2007, Telkomsel will have become the region's fourth largest operator with over 60m connections, Vodafone India its fifth, with 56m, while DoCoMo will be sixth with 53m and under threat from Reliance India, which will by then have more than 50m customers.

Another Indian company, the state-owned BSNL, is eighth in the order with a total of 32.9m connections. By most standards, this has performed well, but in the context of India, it has been under-performing. Until twelve months ago, it was larger than Vodafone India, but was not able to match that company's much improved growth rate over the course of the last year. Across the border, in Pakistan, the recent quarter has seen another strong performance from the market leader and Pakistan Mobile has now become the 22nd network in the world to reach the 30m milestone. It closed the quarter with 30.6m, up one place in ninth. The loser was another Japanese company, KDDI, which dropped one place. As with DoCoMo, its position looks secure for a couple of quarters, but not much longer. It has a lead over eleventh placed Satelindo of 4.7m (29.2m and 24.5m, respectively) but the Indonesian number two is growing at more than twice the rate KDDI managed last year and also has a far larger target market.

Change on the cards as varying growth rates show

The lower half of the list of 20 top operators is a mixture of companies from the sub-continent which are gaining ground and companies from elsewhere in the region, that are also gaining ground, but at a slower rate. Satelindo moved up one place in the quarter, at the expense of AIS Thailand, which added fewer than one million customers, to close the year with 24.1m. SK Telecom, the largest operator in South Korea, has bucked the trend for the moment and stays in 13th place, with 22m customers, but again, preliminary figures suggest it is almost certain to lose its position in the current quarter to both Tata and IDEA from India. Tata is itself up one place in 14th position and IDEA up two, in 15th, both companies having enjoyed strong fourth quarter growth to close the year with 21.7m and 21.1m customers respectively.

Globe from the Philippines was overtaken by IDEA in this latest quarter, but retains 16th place as it surpassed its domestic rival Smart. The two ended the quarter with 20.3m and 20.0m respectively, which, for Smart, means a drop of three places. (It is worth noting here that including the figures of sister business Piltel would have gained Smart tenth place in the ranking at the end of Q4 07, ousting KDDI and pushing all others below it down by one place.) Softbank in Japan is in 18th place, thanks to another good quarter, in which it connected over 400k new customers.

The last two places are taken by further representatives of the sub-continent, bringing its total presence to nine. Grameen Bangladesh is Telenor's largest business in the region. Having been 20th in the September quarter, it has risen to 19th this time around, with a total base of 16.8m. It overtook Pakistan Telecom's Ufone to get 19th, but the state run operator's drop appears to be more to do with lost market share, rather than anything else, as it added about 800k customers in the quarter.

It is worth noting that between them, the nine representatives of the subcontinent's mobile industry have a total of 275m customers, with the six largest Indian companies accounting for 212m of this.

Posted to the site on 24th April 2008

This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.

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