This year, China mobile said after today's earnings release, plans to spend 41.7 billion yuan ($6.7 billion) to build 4 g networks, and hope that in its own network operation apple iPhone, to develop the market demand for this kind of mobile phone.
China mobile, the world's largest mobile operator, has more than 10 million iphones. Unfortunately, the iPhone does not currently support China's own standard td-scdma technology. China mobile has been unable to sell iPhone contract machines as rivals, which has led to a slowdown in China's mobile profit growth.
China mobile currently has a market value of about $220 billion, half apple's. Results show that in 2012 net profit rose 2.7%, to 129.3 billion yuan ($21 billion), slightly better than Reuters survey of analysts' average estimate of 127.4 billion yuan, since 1999 the lowest profit growth.
Industry experts expect apple's next iPhone to support China mobile's td-lte 4G technology, though it will be far smaller than fdd-lte in the world. "Once the 4G technology is supported, the iPhone will significantly boost the number of mobile users in China," said huang leping, an analyst at nomura international in Hong Kong. But because China mobile also needs to subsidize the iPhone, the first year will have an impact on profits.
Mobile phone subsidies this year will reach rmb27bn, up 13 per cent from a year earlier, China mobile said on Thursday. China telecom began operating the iPhone last year. In the first half of last year, China telecom's subsidies for mobile phones increased by 50%. In the past three quarters, China telecom's profits have been falling due to higher marketing and subsidy costs.
China mobile now has 715 million users, most of whom use only basic services, and they focus on China mobile's extensive network coverage. Only a small number of users pay a higher fee and understand the technology.
Currently, only 13% of Chinese mobile users use 3G services. China unicom has a third of 3G users, while China telecom reaches 44 per cent. If the user tries to use the iPhone in China mobile's 3G network, it will automatically connect to the 2G network. However, many users use the WiFi hotspots of China mobile to surf the Internet, playing games and downloading software and other data traffic activities.
Some of China's mobile stores even offer shears, as demand for the iPhone has boosted the popularity of SIM card shears. China mobile is now working to build 4G networks to improve user experience. In the Chinese market, using tencent WeChat and sina weibo via smartphones is a common phenomenon.
China mobile plans to invest rmb190bn in online construction this year, with rmb41.7 billion of that going to 4G networks, China mobile executives said on Thursday. Last year, China mobile's net spending reached rmb127.4bn. China mobile chairman xi guohua (MWC) mobile world congress in Barcelona, said China mobile plans for the construction of the td-scdma LTE 4 g networks will include 200000 base stations, covering more than 100 cities in China, the potential number of users reached 500 million.
China mobile also said on Thursday it expected the Chinese government authorities to issue a 4G licence by the end of this year. Senior Chinese officials had similar hints last week, when news sent shares in the Hong Kong stock market soaring.
