China Telecom profit dives 34%

Fiona Chau
23 Mar 2010
00:00
Mobile service revenues rose six times to 30 billion yuan, compared to 5.4 billion yuan in 2008. Mobile subscriber numbers doubled to nearly 56.1 million, with market share growing from 4.5% in 2008 to 7.7% last year, thanks to its 10 billion yuan in phone subsidies. 

Of the total, nearly 4.1 million signed up to the 3G network, well above rival China Mobile, which had 3.4 million 3G users last year

The company hopes to add 30 million new subscribers this year, and is confident that it can meet its target of 100 million users by 2011, Wang said.

In contrast to the flourishing mobile unit, China Telecom’s fixed-line business continues to wilt. Revenue fell 3.2% to 172 billion yuan and voice revenue dropped 18.5% as the company lost 19.8 million access lines.

Wang said the fixed-line business would continue to contract but hoped to slow the loss of customers with offers such as wireline and mobile bundled service packages.

He said mobile services – which contributed 17.1% of total revenue – together with broadband and wireline VAS and integrated information services, would become the company’s three major growth drivers.

Broadband subscribers rose 20.8% to 53.5 million last year, generating over 47 billion yuan of revenues, up 17.1%. Wang said increased bandwidth demand driven by new applications and the low broadband penetration rate in household (16.7%) offered huge potential for the company. 

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