SARS slows mobile subscriber growth in China

China has long been one of the fastest growing markets for mobile telecommunication services, but statistics released by the Ministry of Information Industry (MII) for the first half of this year reveal that subscriber growth has slowed substantially in the world’s most populous country, both in terms of percentage growth and the number of new subscribers.

As with the slower growth rate for China’s Internet population reported earlier this week, lingering effects of the severe acute respiratory syndrome (SARS) outbreak may be partly to blame.

The number of mobile-phone subscribers in China grew 13.8 per cent during the first six months of this year to pass 234 million, according to the latest statistics released by MII, which oversees China’s telecommunication industry. That number, which counts the number of mobile-phone subscribers in China by the end of June, represents an increase of 28.5 million users since the beginning of 2003, MII said.

While still showing impressive growth, those numbers fall short of statistics recorded for the same period last year. During the first six months of 2002, the number of mobile-phone subscribers grew 21.7 per cent from 144.8 million to 176.2 million, an increase of 31.4 million subscribers.

The slower growth for the number of new mobile-phone subscribers during the first half of the year mirrors a similar trend among new Internet users.

The China Internet Network Information Center (CNNIC), which oversees the .cn domain, reported this week that the number of Chinese Internet users climbed 15 percent during the first half of 2003 to reach 68 million. That growth rate was significantly slower than the growth rate for the first half of 2002, when the number increased 35.5 per cent, and analysts have pointed to the outbreak of SARS as one of the reasons for the slowdown.

The same holds true for mobile-phone subscriptions, according to China’s second-largest mobile operator.

“SARS is definitely part of the reason (for the slower growth),” said Sophia Tso, a spokeswoman for mobile operator China Unicom Ltd. “SARS did affect our subscriber growth, the number of new subscribers.”

Tso added that the impact of SARS on subscriber growth had been at its worst during May. But with the SARS outbreak now in the past, China Unicom is seeing subscriber growth pick up at a faster pace than had been seen during the outbreak of the disease, Tso said. “Things are looking up,” she said.

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Jim Love, Chief Content Officer, IT World Canada

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