Analysys International Says China Mobile's Information Fees of JAVA Services Reached RMB 140 Million in Q2 2006

Analysys International Says China Mobile's Information Fees of JAVA Services Reached RMB 140 Million in Q2 2006

September 29, 2006

    BEIJING, Sept. 29 /Xinhua-PRNewswire/ -- Analysys
International, a leading Internet based provider of
business information about technology, media and telecom
(TMT) industries in China, says in its recently released
report "China's MVAS-JAVA Service Market Quarterly
Tracker Q2 2006", that China Mobile's information fee
of JAVA services before revenue sharing settlement reached
RMB 140 million in Q2 2006 with an increase of 17% over Q1
2006.  

    Just like the WAP services, JAVA services, influenced
by China Mobile's movement in cracking down the
self-consumption phenomenon, the growth rate slowed down. 
However, the revenue share from self-consumption of JAVA
services in the second quarter of 2006 still maintained as
high a level as 60%. That left little profit margins for
the SPs.  Even China Mobile had not started the cracking
movement; the only result from the rampancy of
self-consumption will be crush and perdition. 

    In this quarter, SPs' breach of regulations in
Baibaoxiang services obviously increased.  Under the
increasingly severe regulations and policies of China
Mobile, many SPs still risked danger in desperation.  They
set various fraudulent traps for users to snatch their
money.  Breach actions such as bundling and
self-consumption have been used more frequently than
before.  Under the macro background of China Mobile's
movement of cracking down on self-consumption in June 2006,
the information fees before revenue sharing settlement of
Baibaoxiang services still went up against the situation
and reached RMB 54.11 million, which showed a sharp
increase of 21% over the RMB 44.64 million of May 2006. 

    Figure: China Mobile's Wireless JAVA Market Size in Q2
2006 (RMB Mln)
    
http://english.analysys.com.cn/3class/detail.php?advertisement=002&id=246&name=report&FocusAreaTitleGB=&daohang=Report&title=


    Analysys International had pointed out that the simplex
marketing promotion channel (position) is the major reason
to result in the self-consumption phenomenon.  Meanwhile,
self-consumption disturbs the normal market competition
landscape.  As self-consumption can bring huge revenue in
the short term and change the rankings, the SP competition
landscape always falls into turbulence, and the changes
cannot reflect the genuine product and marketing strength. 
"Unfortunately, this condition has not been improved in
the second quarter 2006.  The regulations from China Mobile
tightened, and the environment of SPs continues
deteriorating.  The worse competition environment increased
the possibilities of SPs to take up breach actions including
self-consumption, while the breach actions induce to severer
regulations from the carrier.  And this creates a vicious
circle," says Jin Hui, an analyst from Analysys
International, "The continuity of this situation is
very harmful to the long-term healthy development of JAVA
services.  The carrier should adopt practical methods to
expand the SPs' marketing channels and solve the problem
from the root while cracking down on the self-consumption
and rectifying the SPs' fraud actions."

    This subject is further discussed in Analysys
International's research report "China's MVAS-JAVA
Service Market Quarterly Tracker Q2 2006."  For more
information, please check the website:
http://english.analysys.com.cn .  
 
    About Analysys International

    Analysys International is the leading Internet based
provider of business information about technology, media
and telecom (TMT) industries in China with the mission to
help their clients make better business decisions. They
provide data, information and advice to 50,000 clients
worldwide, representing 1,500 distinct organizations; they
also deliver over 150 consulting engagements a year, and
hold more than 20 events that draw in over 8,000 attendees.
Their clients include executives from companies like
technology vendors, vertical information technology users,
as well as professionals from professional service
companies, the investment community and government
agencies. For more information, please visit the website at
http://english.analysys.com.cn . 

    For more information, please contact:

     Jessica Wang
     Analysys International
     Tel:   [phone] x394
     Fax:   [phone]
     Email: [e-mail] 

SOURCE  Analysys International