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China Daily

Massaging services will become the most important form of mobile data communication in the coming few years as other data services like mobile Internet and e-commerce make slow progress, a senior telecommunications expert predicted yesterday.

"I believe this year's short massaging service (SMS) market will maintain the momentum of last year with the involvement of the country's biggest fixed line operator China Telecom and new services,'' said Deng Zhicheng, a research manager with CCID Consulting Co Ltd, a major Chinese IT market research firm close to the Ministry of Information Industry.

According to statistics from the organization, the short massaging market in China reached 1.9 billion yuan (US$230 million) and the figure is expected to grow by more than a half to 3 billion yuan (US$360 million).

In 2005, the market will be as big as 10 billion yuan (US$1.2 billion).

Deng said a lack of applications for mobile Internet services and doubts about its value among subscribers meant the other major forms of mobile data services will lag behind short messaging.

This has meant the market has lured great attention from telecom operators.

CCID Consulting's figures show that there were only 150,000 users using handsets with Internet capacity last year -- about 0.1 per cent of China's mobile phone subscribers. The figure is only expected to reach 95 million by 2005 -- about 2.5 per cent of the anticipated number of mobile telecom users.

China's two major mobile operators, China Mobile and China Unicom, have reached an agreement to enable their subscribers to use each other's network from May. This has been regarded as a key step in the development of the market.

Last year, more than 80 per cent of the 19 billion messages was sent through China Mobile's network, so co-operation between the two operators' network is believed to enhance China Unicom's market share, while enlarging the total market.

With enthusiasm bubbling among telecom operators, new services will add more stimuli to the short messaging market, Deng Zhicheng said.

"In recent years, people have been sending text messages via mobile phones but the progress of technology means more and more people will music, pictures, video, or even games,'' he said.

Daniel Mao, CEO of the Chinese Internet portal Sina.com, also stressed the importance of new services.

"If we regard short messaging as purely text information, the market will be quite limited, so we must integrate it with the Internet and other value-added forms,'' he said.

The company said more and more of its subscribers have begun to send messages with pictures or music via its webstie, which charge five to 10 times more than ordinary text messages (0.10 yuan per message, or 1 US cent).

Telecom equipment providers are also actively promoting the use of a new generation of short messages -- the multimedia messaging service (MMS).

Earlier this month, Fujian Mobile Communications Co Ltd sent the first MMS in China through the Finland-based mobile giant Nokia's 7650 handset and network equipment.

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