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SMEs set to spend more on telecoms

SMALL and medium enterprises in China will increase spending on telecommunications to improve their mobility level, despite the slowdown in the economy, a research firm said yesterday.

Riding on a strong domestic market, SMEs in China are less exposed to the global economic slowdown than most of their counterparts in other countries.

They expect to continue spending on telecoms during the downturn, according to Ovum, a United Kingdom-based information technology consulting firm.

"They are price-sensitive'' and are more likely to invest in software rather hardware in order to avoid huge up-front capital spending, said Claudio Castelli, a senior analyst at Ovum.

China now has 42 million SMEs, which account for about 60 percent of the country's gross domestic product. Presently, 60 percent of Chinese SME employees have mobility devices such as walkie-talkies compared with about 90 percent of their counterparts in the West, which indicates a huge potential in mobile services development in China, analysts said.

SMEs in China recognize the importance of mobility and being able to keep in touch with their staff on the move and are likely to adopt new mobile applications, like mobile e-mail, mobile-based instant messaging and mobile multimedia, which offer enormous opportunities for mobile unified communications providers such as China Mobile, China Telecom and China Unicom, according to Ovum.

Applications that meet specific needs of a mobile work force, such as tracking goods or vehicles, field service and sales force automation, will also be in demand, industry officials said.



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