4 Reasons: The future of Mobile Phone is China not USA

I guess I am wrong about the title of this entry. China has already become the top country in terms of user base. By the end of June 2006, the number of mobile phone users in China has surpassed 426 million. Most probably, by now this figure has surpassed 430 million. Isn’t that more than the combined population of US and Canada? Of course, the mobile phone market in China is not so matured like US. For example, China is still far behind in mobile commerce, browsing Internet by mobile phone etc. Still, I think that the future of mobile phone is with China not with USA. Here are 4 reasons:

1. The Number game: China has a population of nearly 1.2 billion. So, the mobile phone market in China can grow for many months yet. In USA, the market is already saturated. Mobile phones will rush to the place where the growth is.

2. Cheap Labor always attracts: When it comes to cheap and skilled labor in the manufacturing sector, China rules. So, now most of the key players in the mobile phone industry have their manufacturing facilities in China. In fact, this year, the top 3 performers in Chinese mobile phone market are foreign companies- Nokia, Motorola and Samsung.

3. Regional advantage: China is neighbor of many Asian countries. So having strong presence in China means that a mobile phone company can easily cover the markets of South Asia, South East Asia and East Asia. This is where the maximum growth in mobile phone is taking place. From USA, it is not economically feasible to cover these regions.

4. It’s a Chinese Century: Within a few decades, Chinese economy is going to overtake the US economy in the size of GDP. China Mobile Ltd. has emerged as the largest mobile phone operator in the world in terms of market value. So, I am confident that Chinese companies will emerge as serious contender in every area of mobile phone industry. Chinese mobile phone users exchanged nearly 200 billion of SMS in the first 6 months of 2006.

As for me, I am convinced that the future of mobile phone is with China not US. If you do not agree with me then let me know your opinion in the comment section.