China Telecom will seize 4G opportunities

China Telecom Corp Ltd, one of the country's three main State-owned carriers, said it plans to climb on the fourth-generation bandwagon after suffering a marked decline in low-end subscribers.

The company lost 5.34 million subscribers, primarily those using second-generation phones, mainly because of intense competition from other carriers.

But within one month of the company being granted a trial permit for TD/FDD, a 4G network, its number of 4G users rose to 600,000 in 16 cities at the end of July, said Wang Xiaochu, China Telecom's chairman and chief executive officer.

Based on Wang's prediction that the 4G FDD/LTE license would expand to 50 cities next year, China Telecom is poised to become more competitive, said an analyst from UOB Kay Hian.

The company reported an 11.8 percent increase in net profit in the first half of the year, to 11.44 billion yuan ($1.86 billion), with turnover up 5.3 percent to 165.973 billion yuan over the same period.

The company spent 29.33 million yuan to enhance its network quality for 3G and 4G, wired lines and wireless broadband in the year's first six months.

Its operating expense was 17.7 percent of its operating revenue, an increase of 2.9 percentage points.

The past six months also witnessed the carrier deploying 26,000 4G base stations.

Expenditure on 4G networks is expected to increase, but it will be one-time costs, the analyst said.

Mobile data revenue increased by 60.1 percent to 15.75 billion yuan year-on-year, surpassing mobile voice revenue for the first time.

The company now has 20 models of 4G handsets in the market, and the number is expected to rise to 100 by the end of the year.

Next-generation iPhones sold by the carrier will support all the wireless networks, China Telecom's Shanghai branch announced on Sina Weibo last week.

It means the upcoming iPhone 6 to be sold by China Telecom will function across a variety of other networks, including TD-LTE and FDD-LTE.

It will be a shift in policy for Apple Inc's products sold by China Telecom, which previously were only products that accepted its SIM cards.

Wang told China Daily that the change will benefit more mobile users and will not affect its 4G business or its subscriber base.