April 21 (Bloomberg) - China Mobile Ltd. became the first telephone company in the world to exceed 600 million subscribers that it has signed more rural customers in the first quarter.
China Mobile added 16.8 million subscribers in the first quarter, one almost 3% increase in the 584 million customers at the end of December, the company said yesterday.With mobile devices now represent 75 per cent of the 1.2 billion China phone users, the Beijing-based carrier is getting most of its new customer additions in the countryside who spend less on their monthly phone bills. Thus the average revenue per user, or ARPU, for the quarter ended March 31, dropped to 67 yuan ($ 10.3), 76 Yuan at the end of December, the company said yesterday. "" This subscriber number is rather good, "said Jim Tang, an analyst at go Wanguo Securities Co. in Shanghai who rate stocks"neutral". "Is especially low end subscribers, this is why you see the growth of profits to a single digit.Net profit for the first quarter rose by 5.4% to 26.9 billion yuan, 25.5 billion yuan a year earlier, reported China Mobile. Sales increased from 8.3% to 118.2 billion yuan.Profit in the first quarter was projected at 26.8 billion yuan on sales of 119 billion yuan, according to the median of four analysts estimates in a Bloomberg News survey. "Low use customers"new clients were mainly low usage customers,"Chairman Wang Jianzhou, said yesterday. "ARPU and average revenue per minute of use continue to decline."Wang is designed to battle the decline in revenue per user by the expansion of sales of data value added services such as music downloads top range of smartphone users.China Mobile said 549 million customers made use of value-added services in the first quarter and 476 million used his music wireless service. Value added services have been the "driving force" of sales in the first quarter, he said.Wang expects the company to data will be an important source of future earnings growth and plans to increase spending of 6.5 percent this year to strengthen investment services. China Mobile will spend as much as 117.7 billion yuan to invest on the network and add points of access wireless that it is intended to keep attracting smartphone users and help maintain its advance on China Unicom (Hong Kong) Ltd. and China Telecom Corp. 'data Revenues' China Unicom this week reported it added 9.6 million subscribers in the first quarter taking his total to 320.9 million at the end of March. "It's data revenues which are clearly on the rise,"Colin McCallum, an analyst with Credit Switzerland Group AG in Hong Kong, wrote in a report April 15." "This seems to be a very healthy ratio of income to the volume, which China Mobile management has put an end to a deliberate strategy to avoid unlimited data packets.China Mobile increased 0.8% to HK$ 72.60 16 hours near trade in Hong Kong yesterday before the earnings announcement. The stock market dropped by 6 percent this year.China Unicom and China Telecom will report earnings next week.-Edmond Lococo. Editors: Suresh Seshadri, Robert Valpuesta.
To communicate with the staff of Bloomberg News on this story: Edmond Lococo in Beijing at elococo@bloomberg.net
To contact the editor responsible for this story: Cho Young-Sam to ycho2@bloomberg.net
