Some commentators report China Mobile’s full-year earnings showed a less-than-expected 30% increase in net profit, which rose to RMB112.80 billion($16.5 billion). They accept revenue climbed 16% to RMB412.34 billion, but they clain growth at the world’s largest mobile carrier is slowing. Which is one way of looking at it.
Or you could just say the biggest mobile operator in the world increased its net profits 30% this year which is pretty satisfactory news.
In fact, even the company allowed that it now faced several challenges including rising penetration rate of mobile services, the continued impact from the government’s restructuring of the telecommunications industry last year and the issuing of 3G licenses.
China Mobile was assigned the license for homegrown 3G standard TD-SCDMA, a largely untested technology which is still not popular with users nor yet with makers. But it has one massive advantage which in that it does not have to pay a serious royalty to any maker or American telco. So if TD-SCDMA becomes popular and if TD-SDMA handsets become sexy and must-have items, China Mobile will make much more money.
From its annual report, we can learn a lot on how its 463.92 million subscribers use their mobile phones.
SMS and MMS usage: China Mobile customers sent 607.1 billion SMSs last year, an increase of 20%. The number of MMS sent jumped 130 percent compared to last year, rising to 33.1 billion messages. If there are, say 470 million subscribers they are sending 1,246 messages a year each which makes them very busy.
China Mobile’s music club added 18.23 million users in 2008, giving it a total of 85.11 million members. It has one million songs in its store. In 2008, subscribers dowloaded 76 million full music tracks.
Mobile newspaper: Paying subscribers to its mobile newspaper service climbed to 41.49 million, a rise of around 30% compared to last year. Its service has 110 newspapers on offer with customers subscribing to multiple mobile papers. The importance of this news to the newspaper business cannot be over-estimated.
For China Mobile, getting a range of TD-SCDMA handsets that match the competition will be key. They need to be as sexy as the models holding them in our illustration. An iPod TD-SCDMA would be the ultimiate but seems impossible. So far China Mobile is believed to have around a million 3G customers.
MarketWatch says that perhaps the biggest question on China’s belated 3G push is whether the country can really afford to build out three separate networks. The government, after all, is still majority owner of all carriers despite their stock market listings.