According to government figures, Chinese telecom operators were very aggressive in their deployment of 3G networks last year, with total investments hitting 160.9 billion yuan.

Compared with 2G and 2.5G services, 3G allows simultaneous use of speech and data services and higher data-transfer rates. This gives telecom operators a great chance to cash in on the use of data traffic to counter declining revenue from traditional voice services.

In China however the 3G market is unique in that different telecom operators have adopted different 3G standards to deploy their networks. For the country's largest cell-phone operator China Mobile, adoption of TD-SCMDA technology was mandated. Smaller carriers China Unicom and China Telecom have adopted WCDMA and CDMA2000 technologies respectively.

The government hopes that by adopting more mature technologies, China Unicom and China Telecom will challenge the dominant position of China Mobile, which controlled over 70 percent of 2G users, thereby increasing competition in the country's telecom market.

According to company figures, China Mobile's market share in the new user market has fallen to 47.63 percent in November from 78.2 percent in January 2009, although the company still far outpaces its two rivals in total user numbers.

MIIT's latest figures show that China Mobile's share in the 3G market was 41.6 percent last year.