iPhone Sales in China Leading to Huge 3G Subscription Growth

China is lagging behind believe it or not despite the impressive growth. Last year the 3G subscriber base was only about 12%. By the end of 2013, it is projected that 3G subscriptions will grow by another 325-350 million users. China Mobile, the world’s largest carrier with over 700 million subscribers, has only a little over 80 million using its proprietary 3G network (TD-CDMA).

China Unicom and China Telecom, China’s number 2 and 3 carriers respectively, have grown near 100% since last year, and together have larger stake in the 3G market. Both carriers also offer Apple’s iPhone (China Telecom through its Beijing Telecom subsidiary), which distinguishes them from their larger rival and has also been cited as a major reason for their growth, both in customers and in overall 3G subscriber base.

he Chinese wireless market is seeing impressive growth. According to a recent report, smartphone sales in the world’s most populous nation — which is home to more than one billion mobile subscribers — are estimated to have increased 137% in 2012 to 189 million units. Demand for EDGE and 3G models is said to be exploding and helping local Chinese brands corner the market with an estimated 61% share, an increase from 29% earlier this year.

Brian White of Topeka Capital Markets echoed these findings, noting that 3G subscription have risen in China by 88% year-over-year and totaled 222 million in November. In fact, 3G subscribers now represent over 20.1% of China’s wireless customers, compared to 12.2% a year ago.

The country’s numbers are still relatively low when compared to other developed nations despite this recent boom, however the analyst believes there are “significant growth opportunities for mobile device companies such as Apple over the next several years.” The firm estimates that 3G subscriptions will continue to increase and could total between 325 million and 350 million by the end of 2013.

“China Mobile is the only major carrier in China that does not offer Apple’s (AAPL) iPhone, which has hurt the carrier and boosted its competitors China Telecom and China Unicom, which have grown 99% over the past year and have a combined total of 139.2 million 3G users.”
However, the country’s 3G numbers are still comparatively low when compared to other developed nations despite the recent boom. Nonetheless, White believes there are “significant growth opportunities for mobile device companies such as Apple over the next several years.”
Apple launched the iPhone 5 in China on Dec. 14 on both carriers, and in the first weekend, more than two million units were sold.