China could issue up to three new mobile phone licences in an effort to increase competition, officials at the Ministry of Information Industry suggested to analysts at a recent meeting. At an investment meeting organised by China Mobile (Hong Kong) in Beijing, analysts were told by ministry officials that they would prefer to have three to five mobile operators in the country rather than the duopoly that dominates the market. 'The ministry confirmed the likelihood that 'several' new telecoms licences might be issued in the future, although the number of facilities-based operators would likely come into the three-to-five range,' Morgan Stanley said in a research report. China's 125.7 million cellular phone users - the world's largest mobile phone market - have a choice of only two operators, China Mobile and China Unicom. Although telecoms regulator officials did not detail the timing of the licence issues, they suggested it could happen as early as the end of next year when technology to support third-generation wireless services had been developed. New licences would most likely be issued to carriers when the ministry grants 3G licences. China Telecom, the country's dominant fixed-line operator, is widely expected to be given a mobile licence by the end of next year when it returns the Personal Access System wireless spectrum to the regulator. Lehman Brothers telecoms analyst Charles Peza does not expect existing mobile operators to face competition from new entrants before 2004. Bank of China International also said in a research report that China Telecom was likely to be designated a 'universal services carrier' within the next two years. It would receive compensation from a state fund to help offset the cost of providing uneconomic services in less-developed areas such as western China.