China Telecom says 20% of connections base is 3G
China Telecom, the third largest mobile operator in China and the world’s largest CDMA player, announced a solid first half of 2011, with mobile services - and 3G in particular - providing its main growth drivers.
For the six months to 30 June 2011, the company reported a profit of CNY9.81 billion (US$1.53 billion), up 8.1 percent year-on-year, on revenue of CNY120.21 billion, up 11.5 percent. CNY31.14 billion of this, representing 26 percent of the total, was mobile service revenue.
China Telecom ended the period with 108.37 million mobile subscribers, up 19.7 percent year-on-year, of which 21.54 million were 3G customers, an increase of 75.3 percent. This means that just under 20 percent of the operator’s customer base now has 3G handsets, up from 7.2 percent at the end of June 2010.
The operator is growing its customer base faster than the market: it said its subscriber market share increased to 12 percent at the end of the period from 9.5 percent at the end of H1 2010.
China Telecom described itself as a “pioneer in launching sub-RMB1,000 3G smartphones, with industry-leading sales volumes.” It also claims to have an “industry leading supply of 3G terminals,” with around 400 models available – including 100 smartphones. 3G handset Internet traffic saw a compound growth rate of more than 12 percent during the first half of the year .
Indeed, mobile data was identified as a key growth driver, with the company also making gains from mobile voice and fixed data – more than offsetting declines in fixed voice sales.
In a statement, Wang Xiaochu (pictured), the company’s chairman, noted that “the intensified market competition and the industry convergence in the mobile internet era are bringing new challenges.”
The company noted that due to its “business development needs” and its planned acquisition of network assets from its parent company in 2012, it has decided not to pay an interim dividend, in order to “maintain adequate funding flexibility.”