China is on track to surpass 1bn mobile connections in Q1 of 2012, with market penetration currently estimated at 72%.

The latest data from Wireless Intelligence shows that China ended 2011 on 973.7m connections, an increase of around 16% year-on-year.

The growth has largely been driven by 3G connections, which surpassed 200m in Q4 and accounted for 22% of the total by year-end.

In 2011 3G accounted for 80% of new connections in China, an estimated 26.8m out of a total of 34.2m.

There are three different 3G providers in China – China Mobile, Unicom and China Telecom - each running a slightly different version of the mobile service.

China Mobile dominates the industry with an estimated 648.7m connections, equivalent to a 67% market share.

The choice of handsets is also growing – Unicom has been the exclusive provider of iPhone since 2009, though China Telecom is said to be close to launching a version of the handset.

China Mobile hasn’t officially launched the device, but it is thought to have millions of GSM-enabled iPhones running on its 2G network.

Last year Apple said that China was its second-most important market after the US, accounting for 16% of its total revenue in Q4 2011, so it is likely that official deals will be in the works.

Both Unicom and China Mobile have their own Android handsets that tie-in to their own app stores.

Unicom said that it planned to ship 90m low-cost smartphones this year and a further 60m high-end devices.

This, combined with a booming market in terms of internet use (the number of web users in China is greater than the total population of the EU), a better understanding of the Chinese market is a must for digitally-savvy brands with global growth in their sights.

Plus, since the population of China is around 1.3bn and there are 10m new internet users per month - there's still plenty of room for growth.

David Moth

Published 20 January, 2012 by David Moth

David Moth is Editor and Head of Social at Econsultancy. You can follow him on Twitter or connect via LinkedIn

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