On the service side, he explains, there are basically two players, China Mobile Communications Corp., with the largest geographic coverage and more than 90 percent of subscribers, and China Unicom. To spur competition, China's Ministry of Information Industry has allowed Unicom some pricing flexibility. They have just about equal market share. Certainly, China has been a very important market for these companies. And these companies, in turn, have been instrumental in bringing sophisticated communications to the Chinese.
Demand is high for wireless services.
China Unicom alone is adding more than 200,000 subscribers per week. Prepaid services are one new marketing tool. When it was introduced in Taiwan, it doubled the growth in the first couple of months. It hit a new market of people who were on the ragged edge of whether they could afford the commitment of signing a year-long contract. Two drawbacks of this strategy, however, are the lack of stability that traditional one-year contracts offer providers, and the provider's inability to identify its customers for market development purposes.