Yang Zemin, president of the Telecom Research Institute of the Ministry of Information Industry, says that China's telecom and mobile value-added services has increased by more than 40% this year compared with the same period of last year.

As of September, China's telecom value-added service market had exceeded CNY121 billion, an increase of 42% compared with that of the previous year. Income from information services was about CNY72.7 billion during the period, accounting for 60% of the total.

Yang said that income from information services has already taken up over 20% of the total information service income and this rate has been growing. He says the information service development has been driven by mobile information services.

Unfortunately, because of new Chinese consumer-friendly laws, many MVAS operators like Linktone (LTON), Tom.com (TOMO), KongZhong (KONG), and CDC Corporation's (CHINA) China.com have not seen such dramatic growth in the sector. Each of the companies' latest quarterly earnings reports show that they either lost momentum or just barely broke even in the last three months.