According to MIC (Market Intelligence Center), an ICT industry research institute based in Taipei, the Chinese mobile phone industry was expected to reach a shipment volume of approximately 158.5 million units in the first quarter of 2008, representing year-on-year growth of 14.9%. The industry's shipment volume in the second quarter of 2008 is forecasted to amount to 164.7 million units.

The Chinese mobile phone industry's shipment volume in the fourth quarter of 2007 amounted to 178.2 million units, up 6.1% sequentially and 18.8% year-on-year. Fourth-quarter shipment volume excluding PAS (Personal Access System) totaled 176.1 million units.

GSM (Global System for Mobile Communications) models are still the mainstream products in the Chinese industry. Driven by a holiday in China in October and the peak season in the worldwide market, GSM phone shipment volume reached 157.9 million units in the fourth quarter, with GSM share of total Chinese industry shipments picking up to 88.6%.

CDMA (Code Division Multiple Access) shipment volume of the Chinese industry declined sequentially in the fourth quarter of 2007. CDMA share of total shipments fell to 10.3%. MIC Industry Analyst Chia-Wei Chang pointed out that this was mainly due to sluggish domestic demand in China and a slowdown in exports. As for PAS products, shipment volume in the fourth quarter continued to decline further to 2.1 million units, representing a sequential decrease of 19.2%.

Catering to strong market demand in the peak season, combined production volume of international brands in China amounted to 95.8 million units in the fourth quarter of 2007, up 9.7% sequentially and 14.3% year-on-year. Their production volume for the full-year 2007 advanced 24.6% annually to 338.0 million units. Their combined share of the Chinese industry's shipment volume reached 53.8% in the fourth quarter.

Chinese makers have encountered challenges from international brands, which have extended their deployment to China's rural areas with value-line product lines. In addition, in October 2007, China's State Council cancelled the approval mechanism for mobile phones managed by the country's National Development and Reform Commission. According to Mr. Chang, it is anticipated that more small- and medium-sized mobile phone makers will foray into the production of mobile phones in the future. This trend is likely to lead to fiercer price competition in China. The growing number of players in the industry is also likely to further intensify the competitive pressure for Chinese own-brand makers.

More information can be found in the following MIC report:  The Chinese Mobile Phone Industry, 1Q 2008

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Market Intelligence Center, based in Taipei, Taiwan, was founded in 1987. MIC is Taiwan's premier IT industry research and consulting firm providing intelligence, in-depth analysis, and strategic consulting services on global IT product and technology trends, focusing on markets and industries in Asia-Pacific. MIC is part of the Institute for Information Industry. https://mic.iii.org.tw/english