China Mobile, the world’s largest mobile operator, plans to lower its capex this year by 5 per cent, but will still spend CNY186 billion ($28.6 billion) on infrastructure upgrades, with 40 per cent going to 4G buildouts.
Last year it added 480,000 4G base stations, taking its 4G total to 1.1 million. This year it will spend CYN75.7 billion ($11.6 billion) on its 4G network, down 4 per cent from 2015, and expand its 4G base station total to 1.4 million.
The operator’s capex peaked in 2014, when it hit CNY215 billion.
China Mobile chairman Shang Bing said capex will gradually decline as 4G coverage reaches the vast majority of the population and it starts renting towers from China Tower, after transferring towers and related assets valued at CNY103 billion last year to the national tower firm. It will spend CNY35 billion on tower rental fees this year.
The operator has a 38 per cent stake in China Tower and last year booked a one-time profit gain of CNY10.1 billion from the transaction.
China Mobile ended 2015 with 312 million 4G customers, up from 90 million the year prior. The operator is targeting 500 million 4G connections by the end of the year.
4G customers represented 38 per cent of its total at the end of 2015, up from 11 per cent a year earlier. 4G data usage accounted for 81 per cent of total data traffic last year compared with 44 per cent in 2014.