China Telecom, the smallest of the country's three telecommunications carriers, announced yesterday its first-half profit rose 8 per cent as its mobile phone business thrived despite strong competition.
Revenues of the Beijing-based carrier rose 11.5 per cent to 120.2 billion yuan (HK$146.7 billion) while mobile phone revenues rose 28 per cent to 18 billion yuan.
The company is the country's largest fixed-line operator by subscribers, but business in that section is shrinking as customers increasingly switch to wireless services.
China Telecom said its mobile subscribers rose 45.4 per cent year on year to 108 million. The number of subscribers for third-generation, or 3G, services, which the company only expanded into in the latter half of last year, rose 75.3 per cent to 21.5 million over the past six months.
'3G mobile service and broadband will be drivers for future development and we will invest more in those fields for better returns,' said Wang Xiaochu, the company's chairman and chief executive. 'The mobile business has started making profit in the first half.'
The company was a fixed-line operator until 2008 when Beijing allowed all three giant carriers - including also China Mobile and China Unicom - to restructure the industry and create competition.
Third-generation subscribers now account for about 20 per cent of all mobile users for China Telecom. Wang said the company would increase 3G to further raise the number of subscribers.