Trends and Analysis: China on the march

By Henry Calvert

Head of Future Networks Programme


Ahead of Mobile World Congress Shanghai 2017 I thought it would be pertinent to focus this month’s trends and analysis update on the Chinese market and examine the development and adoption of IP based communications and services such as VoLTE and RCS. The data contained within this blog comes from our in-house analyst team, GSMA Intelligence, who track the global mobile market with data supplied directly by our operator members. You can keep tabs on it on our website where the data is regularly refreshed.


China has three mobile operators, China Mobile – the country’s largest operator by subscriber numbers, China Unicom, the second largest and China Telecom. All three are active members at the GSMA and participate on a number of different programmes including the Future Networks programme. In terms of mobile connections (including cellular M2M), China Mobile has 973 million with China Unicom on 303 million and China Telecom on 246 million (Q2 2017). China Mobile added 14 million new connections in Q22017 alone, compared to the previous quarter, with Unicom adding 5.5 million and China Telecom adding 5.7 million.


The sheer size of China offers it economies of scale unavailable to other markets and that is reflected in the numbers. It has an astonishing 1,081,163,215 unique subscribers with 89% of these having used mobile internet services (Q22017). It also has an incredible 1,523,874,729 connections when M2M connections are factored in. An impressive 78% of the population now has access to mobile services – making it one of the most advanced markets in the world.


In terms of 4G, the Chinese market is very well developed and market penetration reached an impressive 64% in 2Q 2017 compared to 43% the previous year – where 4G connections are expressed as a percentage share of the total market population. By way of comparison, Global 4G Market penetration was 29% in 2Q 2017 and 34% in the Asia Pacific region. China also makes up 41% of the total 2.17 billion global 4G connections and 63% of the 1.39 billion connections in Asia Pacific. In terms of subscribers, China Mobile – which has a market share of 63% – has 598 million 4G connections with China Telecom on 149 million and China Unicom on 134 million. China Mobile also announced plans earlier this year to invest approximately $25.6 billion in high-speed 4G networks, however this expenditure would be reduced as the market reached saturation point.


China also has a smartphone adoption rate of 71% (Q2 2017) compared to a global smartphone adoption rate of 53% and 52.6% in Asia Pacific. According to our data there has only been one official VoLTE launch in the market so far with China Mobile launching in August 2015, while China Unicom launched a commercial trial in March 2016.


China’s operators are also supportive of the work we are doing on RCS with the development of the Universal Profile for Advanced Messaging, which is now backed by 76 operators, OEMs and OS providers worldwide. It upgrades existing operator messaging services and provides users with a common, consistent and globally interoperable service. We are on track to issue a second release of the UP later this year that will upgrade the service further by enabling Application-to-Person RCS messaging and RCS-capable chatbots, as well as additional messaging expressiveness features. The GSMA will then focus its efforts on the development of Messaging as a Platform (MaaP) which utilises the advanced messaging capability as defined in the UP. We recently outlined the case for adoption here.


China is clearly at the forefront in the development of IP communications, backed by strong government support and proactive operator investment and we are excited to continue our journey with them this year as we look ahead to the 5G era. The Future Networks programme is focusing its efforts this year to help operators capitalise on the new opportunities that IP based technologies will usher in. We will also focus on making it easier for operators to upgrade Person-to-Person (P2P) services such as Rich Communication Services (RCS) as well as new interconnection models.


Future Networks at Mobile World Congress Shanghai 2017

At Mobile World Congress Shanghai 2017, the GSMA’s Future Networks programme will also host a number of events across 5G, RCS and Messaging as a Platform (MaaP) as well as host a number of demonstrations at the GSMA Innovation City in Hall W3. This includes a seminar called ‘A New Global Platform for Conversations, Chatbots and Commerce’ including speakers from China Mobile, Deutsche Telekom, Google, Huawei, Samsung and ZTE. There will also be a seminar titled ‘5G for industry-specific services’ including speakers from China Mobile, Deutsche Telekom, Haier, Huawei and SK Telecom. For further information or to register for any of these events please go HERE.


For further information on the GSMA Future Networks programme please go HERE