China to have 300 million mobile users by 2005

China has predicted that by the end of this year, mobile phone penetration will have reached 24.5 per cent in that country.

According to the Chinese Ministry for Industry, mobile revenues now account for close to half of all communication spend.

In the first four months of this year, there was an increase in users of 2.7 million, which means a total of 295.7 million. By 2004, according to the Ministry, this number will break the 300 million mark.

Use of SMS text messaging is increasing fast and is reckoned to be the one of the most profitable operations. Cellular data services based on CDMA 1x and GPRS are also becoming accepted by more people.

However, many believe the market is still not exploited fully. Around 800 million Chinese live in rural communities and there are those who want prices to be more flexible - in other words cheaper - than that in towns and cities.

In Europe the mobile phone penetration rate is between 60 and 70 per cent. In the US it is about 50 per cent.

Meanwhile in neighbouring Japan, South Korea and Singapore it is respectively about 60, 70 and 80 per cent of the population. In Taiwan the rate is over 100 per cent as many people have more than one handset.

Wang Dan writes for CNET Networks China.