China mobile broadband to pass fixed-line by 2014

Robert Clark
02 Mar 2010

Mobile broadband will overtake fixed broadband in China by 2014, Ovum has predicted.

The primary drivers include growing demand for mobility, cheaper devices and attractive pricing strategies for MBB arising from operators’ ambitious 3G growth plans.

It has forecast a rise from 30 million total connections in 2010 to 377 million in 2014.

“This is a staggering 1157% growth from 2010. We expect that handsets will account for 86% of total connections by 2014,” said senior analyst Tracey Chen.

Full-scale competition in 3G began just last year in China, as the three operators began offering national coverage. At the end of 2009 China had 346 million broadband users and 129 mobile data users, according to MIIT figures.

In the current early phase, laptops dominate connections, but number of handsets is likely to exceed them by the end of the year, Chen says. But laptop users would contribute a disproportionate share of revenue due to higher pricing plans.

Additionally, extensive investment in Wi-Fi by city governments would be a medium term threat to mobile broadband take-up in the low-end segment.

The Chinese government has banned Wi-Fi chips from mobile handsets, but any relaxation of this ban “can only increase the threat” of Wi-Fi, Chen said. “In the long run, the threat posed by Wi-Fi in the low-end market will depend on whether significant government support for Wi-Fi is sustained.”

In response, the operators offer dual-mode 3G plus Wi-Fi datacards, and have chosen a mixed 3G/WiFi strategy.

The other big issue for mobile operators was spectrum. The carriers had worked with some municipal governments to redeploy 3G networks for use in wireless city projects, but this eating into their 3G spectrum allocations.

“Spectrum management issues, particularly the allocation of further 3G spectrum, require clarification and will hold back mass deployment of 3G until resolved.”

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