Biggest gets bigger

16 Mar 2011

China Mobile, the world’s biggest wireless operator by subscribers, saw net profit rise 3.9% in 2010, as tougher competition and fewer additions of low-income mobile subscribers in rural areas balanced out growth from the 3G network. China Mobile said net profit for the twelve months ended 31 December 2010 rose to RMB119.64 billion (USD18.2 billion) from RMB115.17 billion a year earlier. Its net profit growth was faster than the 2.3% it reported for 2009 but well below the 30% rise it reported for 2008. Revenue climbed 7.3% to RMB485.2 billion from RMB452.10 billion, beating analysts’ forecasts. China Mobile also said it plans to increase capital expenditure to RMB132.4 billion this year from RMB124.3 billion in 2010. The budget marks much higher expected spending than it projected early last year, when it said it planned to cut capital expenditure to RMB98 billion this year. About 53% of China Mobile’s CAPEX this year will be spent on network infrastructure, up from 44% last year, it said.

China Mobile’s average revenue per user (ARPU) continued its slide, falling to RMB73 from RMB77 in 2009. Average minutes of use per month was up 5.4% to 521 minutes, while mobile internet access grew to account for 31.2% of total operating revenue. The company added 61.7 million mobile users during the course of 2010, marking slower growth than its 65 million additions the previous year, and bringing its total subscriber base at the end of the year to 584 million, of which 20.7 million were connected to its 3G network. At the end of the year, the TD-SCDMA network had coverage of 656 cities with 135,000 base stations in operation.