The Asia-Pacific region-comprising more than half the world’s population-may soon realize its potential as a cellular market as it reaches a subscriber base of nearly 80 million users by the end of the century, according to a new study from Economic and Management Consultants International Inc.
In “Asia-Pacific Cellular Markets: 1995,” EMCI notes the region’s current penetration rate of less than 1 percent is considerably below that experienced in North America and Europe, and is far below the region’s market potential even after adjusting for income differentials among regions.
The company attributes this stagnation to restrictive government regulations, lack of competition, incompatible systems and capacity constraints. However, EMCI predicts the next five years will be characterized by unprecedented market development as private network operators are licensed and digital cellular systems eliminate capacity constraints.
The study projects digital subscribers will exceed analog subscribers by year-end 1997. By 2000, subscribers on Global System for Mobile communications, Japanese Personal Digital Cellular, Code Division Multiple Access and other digital systems will account for more than 70 percent of the total subscriber base in the region, EMCI said.
The driving forces behind this phenomenon are the introduction of GSM in China and India-the world’s most populous countries-and rapid subscriber growth on PDC systems in Japan and on CDMA systems in South Korea, the company said.
EMCI projects the cellular subscriber base in China will increase substantially over the next few years to more than 21 million subscribers by 2000, accounting for almost 30 percent of the region’s cellular users. Two factors will contribute to this increase: the implementation of GSM systems and the introduction of market competition. India will have more than six million GSM subscribers by 2000, the company said.
The study notes that market penetration is heavily influenced by the level of cellular coverage as well as local demographic and economic characteristics and market maturity. EMCI therefore projects that Australia’s high level of economic development will give it the highest penetration in the region at 31.5 percent in 2000.
New Zealand, Japan and Hong Kong will have penetration rates ranging from 18 percent to 20 percent. South Korea, Malaysia, Taiwan and Singapore will trail with penetration rates from 8 percent to 14 percent, EMCI said.
