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Monday, 07/19/2004 3:11:48 PM

Monday, July 19, 2004 3:11:48 PM

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Short Messaging Service (SMS) is a phenomenon in Asia. According to state released figures, Chinese SMS usage accounts for 1/3rd of the world's messaging traffic. The Ministry of Information Infrastructure figures show that China's 260 million mobile phone users sent a total of 220 BILLION short messages in 2003 to drive the booming "thumb economy."

This year Chinese mobile phone users are on a billion-messages-per-day clip. A billion of anything in a single day is impressive, but when you consider cell phone penetration in China is less than 20%, this number literally becomes staggering.

Why so many short messages? For starters, the cost of a cellular phone call in China is between $0.70 and $1.00 per minute compared to the cost of a short message which is less than $0.01 per message. However, price isn’t the only factor here. It is simply the driving factor.

Corporations have quickly caught on to this method of communicating with Chinese consumers and began pushing corporate logos, advertisements, and discount coupons to end-users. Companies like China Mobility Solution, Inc., (OTCBB: CHMS) quickly saw an opportunity in corporate China and put together SMS infrastructure solutions for corporations.

Mobility solutions for Chinese corporations is now in great demand. Companies are currently looking for SMS solutions to automate their offices and sales forces, advertise to clients and consumers, to provide information access to consumers, and a whole host of other solutions.

CHMS is quickly becoming the leader in this space. They've already gained significant market share and are growing at a very rapid pace. They currently have more than 6,000 corporate clients using their messaging infrastructure.

I'd not only keep an eye on this sector, I'd definitely keep an eye on CHMS. Their executives are very seasoned, and very well connected in the telecommunications sector in China. Their current price of around $0.40 makes an investment into this company a pretty easy entry.

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