China Watch: China Telecom has 100M e-payment customers, MVNOs struggle & more

China Watch: China Telecom has 100M m-payment customers, MVNOs struggle & more

22 SEP 2014

A weekly update on developments in the world’s largest mobile market:

China Telecom has 100M m-payment customers
More than 100 million China Telecom customers now have a Bestpay mobile payment account. The operator is applying for various financial licenses, reported C114.net, a telecoms news portal.

Bestpay, set up in 2011, had payment transactions of CNY130 billion ($21 billion) in the first half of the year, according to China Telecom’s 1H report.

C114.net, quoting a Bestpay executive, said transactions are forecast to hit CNY320-330 billion this year, revenue will reach CNY1.3-1.5 billion, with a profit of about CNY30 million.

MVNOs struggle to attract customers

China’s new class of MVNOs look like they will struggle to hit the government’s projected target of 10 million customers by the end of the year.

China Unicom recently said the 12 firms re-selling mobile services using its network had 180,000 subscribers at the end of July. A report by C114.net said last week the first batch of 19 companies had just 200,000 customers.

Since the beginning of the year when the government first made steps to open the country’s telecoms industry, licences have been issued to 25 firms.

The MVNOs face two huge hurdles. The first is that mobile penetration is about 90 per cent and the second is that retail prices offered by the big three operators have dropped below the wholesale cost.

Smartphones
China’s low-cost smartphone makers are following Xiaomi’s lead and are increasingly looking to online channels to market their handsets.

DigiTimes reported that Huawei, Lenovo, ZTE and Coolpad have boosted their marketing efforts through online stores as well as retail outlets to reduce their dependence on operator sales.

Currently about 50 per cent of smartphones are sold through the operators, 30 per cent at retail stores and 20 per cent online.

The operators announced a cut in subsidies following instructions in July from China’s Assets Supervision and Administration Commission for the country’s operators to reduce subsidies by a combined CNY40 billion ($4.8 billion) over the next three years.

A source told DigiTimes that Huawei sold 50 per cent of its Honor smartphones online while ZTE’s new Nubia brand is marketed mainly online.

Author

Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

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