Advertisment

China Mobile call traffic goes up

author-image
CIOL Bureau
Updated On
New Update

SHENZHEN, CHINA: China Mobile, the world's top mobile carrier by subscribers, said on Thursday its call traffic has bounced back to pre-global downturn levels, lifted by a rebounding economy.

Advertisment

China Mobile's international business dropped during the crisis but has now returned to normal levels, Chairman Wang Jianzhou said at an event in the southern Chinese city Shenzhen.

A return of migrant workers to big cities, following their mass departures as work dried up during the downturn, is also helping to drive calling traffic, he added.

"The financial crisis has mostly passed, and we are now basically back to normal levels," he said. "The biggest factor before was a drop in international business, but now that's recovered to normal levels."

Advertisment

Shares of China Mobile and its two main rivals, China Unicom and China Telecom have been relative laggards on Hong Kong's stock market this year, amid concerns about growing competition under a recent industry overhaul that has eroded average revenue per user (ARPU).

China Mobile shares are flat this year, while Unicom and China Telecom shares are up 13 percent and 23 percent, respectively, all well behind a 57 percent jump for the broader Hang Seng Index.

The trio mostly command price-to-earnings premiums over their global peers due to their stronger growth prospects. China Mobile trades at 12 times its 2010 forecast earnings, while Unicom trades at 27 times and China Telecom trades at 15 times.

Advertisment

By comparison, global titan Vodafone trades at 9 times, while U.S. carrier Verizon trades at 12 times.

China is the world's biggest mobile market, with about 700 million subscribers. But that still leaves about half the nation's 1.3 billion people with no mobile service, most of them in poorer, more rural areas.

Ready for home IPO

Advertisment

Wang said he expects ARPU to continue to drop in China's competitive domestic market, while subscribers' minutes of use (MOU) remains flat.

China Mobile and its peers all received licenses to build third-generation mobile networks, and hold out big hopes to boost revenue through data services made possible by the higher speeds allowed by such networks.

Wang said China Mobile, which is constructing a 3G network based on a trouble-prone homegrown technology known as TD-SCDMA, got about 28 percent of its revenue from non-voice services in the third quarter, up from 24-25 percent in 2008, and expects that number to keep growing.

Advertisment

Separately, he said China Mobile, which is technically domiciled overseas due to its Hong Kong listing, stands ready to make a highly anticipated initial public offering at home once regulators roll out new rules allowing such listings.

Others who have expressed similar interest in listing on a proposed international board in Shanghai include global banking giant HSBC and PC maker Lenovo.

"We've done all the preparations and have chosen to list on the international board in Shanghai," Wang said. "We hope the regulator will finalise the related rules soon."

tech-news