NRI Papers
No.53   August 1, 2002
  China's Rapidly Growing Infocom Industry and Approaches by Japanese Companies  
        Having already strengthened its position as a production base for information and communications equipment and software, China has also been coming in for increased attention as a consumer market for such equipment and services over the past several years. For example, the number of mobile phone users has already topped 100 million subscribers and forecasts estimate that this number will exceed even 200 million by the end of 2003. This rapid growth is also seen in the number of Internet users, which expanded by some 10 million during the last year alone. As the low end of this mass consumption market continues to expand, the usage core has quickly started to shift downwards towards budget-priced offerings. For this reason, the market is undergoing a fiercely competitive restructuring as average spending per user continues to rapidly decline despite the accelerating expansion in overall market scale.
    Companies in Japan and other advanced nations have been steadily streaming into China to participate in these markets. The urgent task for corporations hoping to achieve success in China will be to firmly establish a business foundation and to determine appropriate strategies that mesh with these mass-market requirements. Such steps include appropriate strategies that combine cost reductions and the offerings of high-end (advanced) services, as well as the localization of technology and know-how to adapt to domestic needs.
I The Rapidly Growing Infocom Industry in China
1 China's Catch-Up Strategies
2 IT-Related Markets Under Development
3 System Solutions Market on the Eve of Take-Off
II Mobile Phone Service Market Growing Towards World's Largest
1 Trends in Mobile Phone Service Market
2 Competition Policy in the Mobile Phone Service Field
3 Usage Prices Keep Falling
4 Intensified Price Competition in the Mobile Handset Market
III Appropriate Competitive Strategies for Japanese Companies
1 Surviving Cost Competition
2 Defining and Utilizing Market Position
3 Localization of Technology and Know-How
4 Forming Personal Relationships with Chinese Government Officials
5 Market Participation Through Acquisitions


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