Since its new wireless value-added service provider management measure was implemented in June, Guangdong Mobile has downgraded 137 unqualified service providers, accounting for 17% of Guangdong Province's total service providers.

As a continuation of a series of measures such as stopping SPs' right to collect mobile phone calling fees and cracking down on pornographic messages, Guangdong Mobile is focusing on cleansing the SP market by downgrading companies to lower levels of service so that Guangdong Mobile can provide better oversight.

Compared with previous management measures, the new measure features a tiered management of SPs which is divided into three levels. SPs at the top "Close Cooperation Level" are given priority in launching new services, and those who are at the lowest "Basic Cooperation Level" must endure strict oversight, including spot inspections.

Analysts quoted in local media generally believe that with the regulation of SP market and the approach of 3G, the majority of SPs will face bankruptcy.