The Chinese market for wireless value added services (WVAS) will expand from $15bn in 2008 to $21bn in 2012 boosted by the launch of 3G services, according to the latest Juniper Research report.
WVAS revenues in China are primarily generated from SMS and ring-back tone services operating on 2G and 2.5G platforms, but the launch of 3G will see new areas of growth with particular emphasis on music, games and video.
The report suggests that 3G will account for around 19 per cent of total WVAS services by 2012.
"Providers of 3G applications and content have a unique opportunity to tap into this vast new market, but are advised to carefully craft coherent market entry and development strategies," said report author Dr Elisa Kuang.
"These strategies must appreciate China's unique economic culture and business systems in an emerging economy in transition."
Although 3G networks have still not officially launched in China, the market for equipment has rocketed. Companies like Nokia have already started making phones supporting the country's unique TD-SCDMA 3G data format.
This emerging sector offers significant opportunities to new and existing players, but identifying them in time is vital, according to the report.
The fundamentals of intellectual property protection are also key, as is an understanding of the various processes and procedures necessary to navigate through China's regulatory system.
The report concludes that foreign participants need to understand the cultural differences, and learn the best routes to market and the appropriate business models to deploy.
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