Shift in strategy at Unicom

China Unicom, the country's second largest mobile operator, signed up 5.3m new subscribers for its CDMA network between January and July. This was well below its monthly target of 1.5m new subscribers needed make its CDMA business profitable by the end of this year.

However, in an apparent shift in strategy, company executives were reported as saying that it was better to develop the market slowly than to attract subscribers by offering free handsets. The company launched its CDMA service at the start of 2002 by giving away free handsets to subscribers who signed twoor three-year contracts. This strategy cost Unicom Yn6bn last year on an amortised basis and led to a loss of Yn1.06bn on its CDMA business.