More than 50 million people in the Asia-Pacific region will be subscribing to cellular services by the year 2004, and as many as 66 million will be carrying pagers, according to a new report from London-based CIT Research Ltd.
In “Mobile Communications in Asia & the Pacific 1995,” CIT notes the mobile communications boom in the region is only just beginning, but cautions that the region is as diverse as it is populous. Gross domestic product per capita ranges from $370 in China to $37,000 in Japan, while regulatory regimes vary from the most liberal to the most draconian.
The biggest revenue-generating mobile service in the region is cellular telephony. In 1994, the region’s population spent more than $10 billion on cellular connections, subscriptions and calls, the report said.
In June 1994, Nippon Telegraph & Telephone Corp. signed up more new subscribers for its cellular services than for its public switched telephone network lines for the first time ever.
More than half of the money-close to $6 billion-was made in Japan. CIT credits the deregulation of the cellular terminal market, which allowed subscribers to buy terminals rather than rent them, for the boom. The report noted that in June 1994, Nippon Telegraph & Telephone Corp. signed up more new subscribers for its cellular services than for its public switched telephone network lines for the first time ever.
Japan saw four new digital cellular networks premiere in 1994, joining the one started in 1993 by NTT.
Australia and China rank second and third in number of cellular subscribers, with 1.6 million and 1.5 million, respectively. The report notes that China has more than 150 analog cellular networks for its 1.2 billion inhabitants.
CIT estimates that 4.8 million analog terminals and 980,000 digital terminals were sold in the region in 1994, worth about $4.8 billion combined. While analog purchasers are benefiting from economies of scale and increasing competition in terminal supply, unresolved decisions about digital technology standards may hamper terminal affordability and impede penetration. The company projects 88 percent of users in 2004 will be using digital networks.
Global System for Mobile communications is clearly in the lead with 10 out of 12 countries adopting it as a digital standard, the report said, concluding that GSM already may have gained enough momentum across the region to be the winner. Significantly, Japan has opted for its own home-grown Personal Digital Cellular standard rather than GSM technology.
Public access telepoint service is holding on with 290,000 regional subscribers-a 48 percent increase compared with the previous year-but is primarily concentrated in the Hong Kong market where integrated paging and telepoint handsets have made the technology a success.
CIT reports the boom in wide area paging services in the Asia-Pacific region is continuing, with subscribers increasing 50 percent in 1994. China is the largest paging market with 10 million subscribers, closely followed by Japan with 9.1 million users and South Korea with 5.5 million, the report said. However, despite the boom in China and South Korea, Japan accounts for nearly 60 percent of all paging service revenues. The report notes NTT’s paging revenues of more than $1.8 billion in 1994 are greater than any other regional player’s from all mobile services combined.
Meanwhile, CIT reported the European ERMES digital paging standard is faring poorly against Motorola Inc.’s FLEX technology, which has been widely adopted in the Asia-Pacific region and is well on its way to becoming the de facto standard.
In making future projections, CIT notes the Asia-Pacific region will reflect trends in other wireless markets where increasing penetration in the low-use consumer segment will lead to sharply declining handset prices and service revenues per subscriber. “Do not be fooled into believing that mushrooming subscriber numbers will lead to an equally large pot of gold,” the report concludes.