China Telecom, the country’s third-largest mobile operator, bounced back from a tough 2016, expanding its mobile market share and recording double-digit wireless service revenue growth in 2017.
The operator’s net profit increased 3.3 per cent year-on-year to CNY18.6 billion ($2.9 billion), while operating revenue rose 3.9 per cent to CNY366 billion. Mobile service revenue grew 11.7 per cent to CNY154 billion.
Yang Jie, China Telecom chairman and CEO, said: “Facing an increasingly complicated operation environment together with continuously intensified fierce market competition, corporate development faced immense pressure…We fostered transformation and upgrades as well as promoted comprehensive in-depth reforms, attaining important progressive results in phases.”
The operator added 25 million mobile subscribers in 2017 to end the year with 250 million, or 17.6 per cent of the nation’s total (up 1.4 per cent year-on-year), with 4G subscribers accounting for 182 million of its total – a 49 per cent rise year-on-year. It aims to add another 60 million 4G subs this year.
Despite the rise in 4G subscriber numbers, ARPU for the technology fell 10 per cent from end-2016 to CNY65.50 at end-December 2017. Overall mobile ARPU was stable at CNY55.
Mobile handset subsidies dropped 50 per cent to CNY4.7 billion in 2017.
The operator reduced capex 8.4 per cent to CNY88.7 billion and the figure is forecast to drop to CNY75 billion in 2018. Some 41 per cent of 2017 capex was spent on 4G infrastructure (down slightly from 2016), with 280,000 base stations added to take its total to 1.17 million. It aims to install another 200,000 4G base stations this year.
In 2018, Yang said: “Demand for data traffic continues to maintain rapid growth, while emerging businesses show enormous demand capacity, providing vast market development potential for us. Meanwhile, with intensified industry competition together with increased pressure on price competition of data traffic and broadband services, the fleeting development opportunities of subscribers growth slows promptly and cross-industry competition becomes increasingly prominent.”
The company plans to conduct trials of 5G technology, terminals and applications in 12 cities this year.