China Mobile subscribers top U.S. population

Companies are targeting the millions of potential subscribers still untapped in China, India

There are more mobile phone subscribers at one Chinese operator than people in the entire U.S., according to figures China Mobile posted on its Web site late Friday.

The company finished last year with 301.2 million wireless subscribers, just topping the U.S. population, which stood at 300.9 million on New Year's Day, according to an estimate by the U.S. Census Bureau.

Breaking the 300 million milestone at China's largest wireless network operator highlights the trend toward mobile phone use in developing countries. A combination of increasing wealth and falling handset costs is putting mobile phones in the hands of millions of new users each month in countries such as China and India.

A basic GSM (Global System for Mobile communications) handset with a monochrome screen and basic features costs about $25 to build today, while $40 worth of material can produce a GPRS (General Packet Radio Service) handset, which allows users functions such as basic Internet browsing and sending photos to friends.

Such ultra-low cost devices are sold to operators in emerging markets, which often give the handsets to users for free and make money on services.

For China Mobile, growth has accelerated since it hit its first 100 million subscribers in July of 2002. It only took the company just a year and a half to add the next hundred million users, reaching 201.0 million at the end of November, 2004. To sustain its breakneck growth, the company began targeting ads at users in China's vast interior last year. There are still millions of potential subscribers, with China's population estimated at nearly 1.4 billion now.

India is the only country rivaling China in terms of subscriber growth these days. The nation added nearly 74 million new wireless subscribers last year, to end with a total of 149.5 million, according to the Telecom Regulatory Authority of India (TRAI). The regulator estimated India's population at nearly 1.11 billion people at the end of last year.

The number of mobile phone users in India has grown at over 6 million per month over the past few months, compared to 5 million per month in China.

China Mobile increased its subscriber count by 53.2 million people last year. Official figures for all of China are not out yet.