The number of mobile subscribers in China is skyrocketing. For the past year, about 5 million new subscribers per month have joined the network, boosted by China's rapid economic growth and political commitment to improve infrastructure. Kitty Ma, 22, belongs to the young generation that uses mobile telephones constantly. She has traded in her mobile three times since she got her first handset.
Young urban people are driving the use of mobile phones in China. Kitty Ma and her boyfriend Leo Lee send up to 1000 SMSs per month.
Heavy bass tones waft out onto the street from one of Beijing's many department stores. Three enormous floors are selling mobile phones - just mobile phones, expensive, cheap and ultra cheap. A band is playing rock music in the foyer. Girls in chic makeup and even more chic skirts are charming the crowd. People are crowded in, watching intensely, but show no expression.
A mobile manufacturer is running a campaign. If you buy a mobile you can win both a rice cooker and a TV. Business is going well: all the different departments are crowded.
Duncan Clark, an analyst at BDA China, says: "A mobile is a status symbol, a fashion statement. Even if people in China are sensitive to price, they have still been willing to pay for their mobiles. That has been a big surprise."
Everywhere are young people with very expensive mobiles equipped with MP3 players and cameras. China's one-child policy has led many parents to pamper their children with lavish gifts.
Pre-paid
About 98 percent of China Mobile's new customers have pre-paid subscriptions, perhaps because consumers want simplicity and control of their finances. One large population group in China, however, cannot afford mobile phones regardless of how cheap they are: the difference in wealth between the cities and the countryside is still large.
SMS use is increasing and voice revenues are falling in China. When SARS (severe acute respiratory syndrome) broke out in 2003, SMS usage boomed. China's thumb navigators sent 217.76 billion messages in 2004, an increase of 58.8 percent on the year before. That is almost 7000 messages a second; with income of USD 0.01 per SMS, it adds up to a significant amount. There were 10 billion messages sent on Chinese New Year alone.
So the thumb culture is growing in China. Kitty Ma and her boyfriend Leo Lee taught their parents to use SMS a few years ago.
"One reason is that it is much cheaper to send an SMS than to call," Ma says. "Our generation has learned how to communicate with SMS instead of ringing each other. We
hardly know how to make a call," she says, laughing.
The size of the SMS market is also possibly related to Chinese culture. People keep contact with each other but do not need to disturb by ringing when it is inappropriate. The user interface for SMS in Chinese is also a benefit.
Ma and Lee send about 500 to 1000 messages per month. They both subscriber to China Mobile's M-Zone, a youth-oriented brand where the menu in the mobile changes depending on the service offering. There are examples of competitions with users sending more than 300 messages - per day.
Gaming popular
Games are what most attract Ma and Lee. The big thing just now is Paopao Long, which can be played individually or with others over the network. But Ma and Lee think the mobiles are too feeble.
"We want more games in our mobiles, and the download speed has to get better," Leo says. "It takes too long to download new games."
Ma could see herself buying a 3G phone, but it depends on the cost. Anything more than USD 650 would be far too expensive, she says. "We want to try things, just because they are new. I want video telephony so I can see and talk to my friends.
"What does technology matter?" she asks rhetorically. "The technology isn't interesting; it's the services we get that are interesting."
