An Overview Of Mobile Phone Distribution Channels In China

4230 words - 17 pages

An Overview of Mobile Phone Distribution Channels in China
February 2003

TABLE OF CONTENTS 1 CHINA MOBILE PHONE MARKET ...........................................................................2 2 CLASSIFICATION OF CURRENT HANDSET DISTRIBUTION CHANNELS ..................3
2.1 2.2 2.3 2.4 Conventional Handset Distribution Channels .....................................................................3 Conventional IT Distribution Channels...............................................................................4 Household Appliances Chains .............................................................................................4 Number of Distributors/Retailers ...view middle of the document...

..................10
Big Foreign Brands ........................................................................................................... 11 Domestic Manufacturers.................................................................................................... 11 Imported Handsets.............................................................................................................12 Role of Super Household Appliance Chains ......................................................................12

6.

TRENDS OF NEW HANDSETS DISTRIBUTION CHANNELS..............................13

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An Overview of Handset Distribution Channels in China

China Business Solutions Ltd

1 China Mobile Phone Market
China is now the largest market for mobile phones in the world. According to MII, by end of 2002, the number of mobile phone users rose to 206.616 mln, an addition of 61.394 mln users during the year, with a penetrate rate of 16.19%. The Ministry of Information Industry (MII) predicts that the number of mobile phone users is likely to surpass those of fixed-line telephone users by 2004. However the speed of growth has slowed over the last two years and the market has entered into a steady and mature stage.

Growth rate of Mobile Phone Users
160% 140% 120% 100% 80% 60% 40% 20% 0% 1994 1995 1996 1997 1998 1999 2000 2001 2002

Chart 1. Growth of Mobile Phone Users in China (1994 to 2002)
Data Source: MII, 2003

By end of Nov 2002, the total sales volume has reached in total 113 mln units, including both GSM and CDMA phones. According to MII statistics, the latest ranking of handset sales volume in China by end of 2002 is as follows: Motorola, Nokia, Bird, TCL, Siemens, KeJian, Amoisonic, Konka, EastCom (Samsung is excluded due to problem with statistics). Motorola still leads the market (66%), far ahead of Nokia (18%) and Bird (10.4%). Most of the handsets manufactured are sold in China. In 2001, 67% were sold at home, 31% were exported and only 2% remained as stock. However due to increasing overcapacity of production, exports have been increasing in the last year and reached 45% in 2002.

Copyright © 2003 China Business Solutions Ltd

2

An Overview of Handset Distribution Channels in China

China Business Solutions Ltd

In terms of geographical distribution of sales, the share of Eastern China is 62.7%, Central China 19.3%, and Western China 18% in 2002 (see Chart 2). However recent trends show that the market share of Eastern China is decreasing, while those of Central and Western China are rising. Some estimated that mobile phone subscribers
will reach about 360 million with an annual increasing rate of 26.2% by the end of 2005, of which 24.5% will be in the eastern provinces, 26.7% in medium provinces...

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