Chinese research house, CCID Consulting has reported that at the end of June 2008, China's TD-SCDMA user base had reached 50,000, and that trial commercial users exceeded 8,000. CCID Consulting forecasts that TD terminal users will reach 2.3 million by the end of 2008.

In 2008H1, China's mobile phone market performed poorly along with the overall economic situation due to rising energy costs, RMB appreciation and weak purchasing power, but within the industry, lack of innovation in new products also pointed to the slow growth. With the TD commercial trial, users gradually hold reasonable attitude on changing mobile phones.

After four months of trial commercial use, there are only 8,000 TD commercial users. The major reasons are that TD network layout still needs to upgrade; as for terminal technology, mobile phones' performance in not stable, most of terminal 384kb's descent velocity is difficult to widen the disparity with EDGE; as for marketing, TD sales is heavily affected by branding, as currently, the brands in the market are still the six brands that won in the first bid.

China's Domestic TD Mobile Phone Manufacturers Achieve Initial Success

By the end of June, trial commercial mobile phones were limited to six models. As for sales volume, although ZTE's U980's price is higher than the other five kinds of TD terminals, based on its better performance, it still leads in the TD mobile phone market, which accounts for 33.5% of the total market. The next is Samsung, which accounts for 18.9%; the third one is LG, which accounts for 17.6%. CCID Consulting forecasts that at the initial stage of TD commercial use, based on its technical advantage and large investment, ZTE will maintain a leading position; based on technical advantage, Samsung and LG's market share will increase; NOKIA will set foot in TD at selected times.

Although China's domestic TD mobile phones have obvious advantage in China Mobile's former two purchases, which account for 85% in the second purchase, CCID Consulting's data shows that more than 70% of TD commercial mobile phones' shares are mastered by ZTE, Samsung and LG.

Compared with other 3G standards, TD started off late and its industrial chain is weaker in strength, so China Mobile has adopted a centralized purchasing for its mobile phone terminals: on one hand, it could reduce TD industrial business risk, which is still in a growth stage; on the other hand, based on China Mobile's brand and marketing advantage, it could reduce terminal manufacturers' marketing promotion cost for TD mobile phones.

Posted to the site on 17th September 2008

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