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July 13, 2015

Smartphones Will Represent 2 Out of 3 Chinese Mobile Connections by 2016

The Chinese smartphone market is incredibly huge. This is partially due to the sheer number of users, as well as the changing culture in China and the increasing number of models of mobile devices available. But the size of the Chinese mobile phone market is even larger than you would assume. A new study from GSMA Intelligence shows that almost two out of three mobile connections in China will come from smartphones by just the end of this year.

The GSMA Intelligence study, titled “How 4G Devices in China are Transforming the World's Largest Mobile Market,” elaborates on that two-thirds statistic, saying that the market didn't have all that far to go to reach that level. The smartphone market in China—as represented by the total number of connections—already represented 62 percent of connections by just the end of 2015's first quarter. Thus, to reach the projected levels, all the market will need do is add another four percent of connections to reach the target.

That's impressive by any score, but when it's considered that only 55 percent of Europe's connection rate is derived from smartphones, it's clear that the Chinese smartphone market is remarkably large. The report carried on from there, noting that the growth of smartphone markets in urban areas are fueling a lot of that growth, with locally-produced brands competing with foreign-make brands like the Apple iPhone.

The rise in sales with 4G devices is fueling a rise in 4G network growth as well, according to reports. GSMA Intelligence revealed there were 632 million unique mobile subscribers in China as of the end of the first quarter of 2015, which represented just short of half the populace at 48 percent. But there are some signs that smartphone connection growth has been slowing down, suggesting that most of what's been sold are replacement models rather than new users stepping into the market.

It's likely that GSMA Intelligence's figures will come to pass. After all, it's not going to take a whole lot of growth to get to that projected point. The Chinese government might even be able to put this phenomenon to use in terms of drawing investment. But with the numbers already starting to slow, it's not out of line to suggest that growth may be tougher to achieve than suspected. It's starting to look like most everyone in China who wants a smartphone already has one, and with a good chunk of the country rural and largely undeveloped, further expansion of smartphone networks might be difficult.

But clearing that two-thirds mark is already in sight, and that's likely good news in its own right. A clearly mobile-focused region that's well-connected, China might be able to use these numbers to push further moves elsewhere.

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