China Unicom reports 2009 results

25 Mar 2010

China Unicom has reported a 73% drop in full-year profit, on the back of increased spending on its 3G network and a lack of a one-time gain. The company said it spent more on marketing to win subscribers to its CDMA2000 1xEV-DO network amid rising competition from China Mobile and China Telecom. Unicom chairman Chang Xiaobing said his company would raise handset subsidies in 2010 to enable Unicom to attract higher-end customers who could lift revenue from non-voice services such as music and video downloads. Unicom aims to add ten million 3G users this year. Average revenue per user (ARPU) fell 2.4% to RMB41.2 a month in 2009, compared to the RMB77 registered by China Mobile. Unicom, which started offering 3G services nationwide in October, added 14.2 million customers in 2009, including 2.7 million 3G users.

Unicom’s sales in the year ended 31 December 2009 fell 3.7% to RMB153.95 billion, as higher wireless revenue failed to counter lower income from fixed line operations, Unicom said. Sales and marketing costs rose 7.2% to RMB21 billion, while network expenses jumped 16% to RMB21.8 billion.

China, China Unicom