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December 23, 2009

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US$21b on 3G industry

CHINA is expected to invest a total of 143.5 billion yuan (US$21.10 billion) on 3G infrastructure and services in 2009, with the number of 3G users likely to surpass 10 million by the end of this year, the industry regulator said yesterday.

But the telecommunications industry will see only a 4.5 percent rise in revenue year on year in 2010, compared to this year's 5 percent, because of a decline in telecom charges next year, according to the Ministry of Industry and Information Technology.

"The 3G investment has fueled the national economy and stimulated the development of related industries," said Li Yizhong, the minister.

In January, 3G licenses were issued to China Mobile, China Telecom and China Unicom. By the end of this year, the number of mobile phone users will reach 740 million, accounting for 70 percent of the total phone users, Li said. The telcos have built 285,000 3G base stations nationwide.

Investment in 3G, or third generation, will boost demand for chips, telecommunication equipment and mobile services, analysts said.

Users can look forward to lower telecom charges in 2010, which will fall 9 percent on average. Last week, the ministry said cell phone long-distance charges will be cut with the scrapping of roaming and local fees. From January 1, the upper price of a long-distance call should not exceed 0.60 yuan a minute.



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