George Huang, vice president of Nortel Networks’ Chinese operations, has said that he expects the mobile market in China, already the largest in the world, to double in size to 500 million customers by 2007. However, he added that the biggest challenge facing cellcos and vendors in the country was how to drive up ARPU – which currently languishes at an average of USD12 a month, down from a high of USD20 – as most new users are low-end pre-paid customers. Huang said that the eventual launch of 3G services will drive revenues back up, with China Telecom and China Netcom, in particular, needing to launch next generation services. ‘They urgently need to get 3G mobile licences because their fixed line ARPU is even worse than that of their mobile services,’ Huang told reporters at the 3G World Congress conference in Bangkok. The Chinese government is still dallying over whether to throw its weight behind US-backed CDMA 3G standard or the homegrown TD-SCDMA alternative which is still being developed.