China Mobile to reduce capital spending in 3G

With the country aggressively pushing for 3G services last year, China Mobile saw more revenue coming from value-added services. Its average monthly revenue per user in 2009 rose to 77 yuan for the full year from 75 yuan in the first nine months. That in turn, boosted the company’s full year revenue to 452 billion yuan, up 9.8 percent over 2008.

China Mobile, the world’s largest mobile operator, said that it plans to reduce capital spending over the next three years as network expansion for third-generation (3G) services nears a close.

The company will reduce capital spending from 123 billion yuan this year to 80.4 billion yuan in 2012, it said in its quarterly report.

Chairman Wang Jianzhou said the company faces “fresh challenges” from the global slowdown and the growing saturation of the market.

According to company figures, China Mobile’s market share in the new user market fell to 47.63 percent in November from 78.2 percent in January 2009, although the company still far outpaces its two rivals in total user numbers, accounting for about 60 percent.

The company’s net profit for 2009 rose 2.3 percent to 115 billion yuan from 112.63 billion yuan a year earlier.

Chief Financial Officer Xue Taohai said earlier that more than half of China Mobile’s new subscribers are in rural areas, where average customer spending is lower. He said that might lower the company’s profit margins.

The carrier rose 1.92 percent to HK$76.4 on Thursday. The stock has advanced 2.6 percent this year, compared with a 9 percent increase for China Telecom and a 7.7 percent decline for Unicom.

This news is from China electronics manufacturer.

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