Hutchison Telecom, the largest mobile operator in Hong Kong, is the latest to be hit by a fall in mobile subscribers since April, according to industry sources. The mobile-phone subsidiary of Hutchison Whampoa experienced a consecutive six-month net loss in 'port-out' subscribers due to lack of aggressive pricing, they said. The erosion of Hutchison's 1.7 million subscriber base coincided with statistics released by the Office of the Telecommunications Authority (Ofta) which showed the first decline in total mobile subscribers in Hong Kong. At 5.64 million, total subscribers in October fell 12,252 from the high of 5.65 million in September. Mobile penetration is about 84 per cent of the population. According to two industry sources, Hutchison Telecom has lost between 15,000 and 20,000 subscribers a month from August to November in port-out subscribers - those switching from Hutchison's Orange to other operators. Although the trend of switching out from Hutchison had slowed, they said the loss in subscribers could be as high as 100,000 in the past six months. Hutchison Telecom managing director Agnes Nardi said the company had been performing in line with industry trends, claiming the loss was not significant. 'We have some losses, but these losses are mainly from lower-arpu [average revenue per user] subscribers,' said Ms Nardi. 'Our overall arpu actually increased.' She added that the company could generate new sales from selling new mobile numbers. According to Ofta 1.16 million users switched operators between April and October, averaging 165,000 a month. Industry sources suggested the top two gainers from Hutchison losses were SmarTone Telecommunications, a Sun Hung Hai Property associate, and Peoples Phone, a China Resources (Holdings) subsidiary. Both have been carrying promotional tariffs which are considered the cheapest available. They said New World Mobility was a moderate gainer this year, with CSL a moderate loser. Sunday Communications had lost subscribers, but was still a net gainer since number portability started in March 1999. Craig Ehrlich, group managing director of Sunday, said for the past few months, the mobile market theme had been 'stability' and 'profitability' as mobile operators rationalised their pricing behaviour. 'It is good for the company, and it is good for the industry,' said Mr Ehrlich. 'I don't think we will see the kind of price war [we did] in 1999-2000.' In a fight for market share, last year some operators offered tariffs as low as HK$38 per month for 500 minutes - a rate that was seen as insufficient to cover operating costs. Now the landscape has changed. With 84 people in 100 mobile-phone users, the company employed different strategies, he said. 'Profitability is our No 1 focus,' said Ms Nardi. 'Why would operators still want to undercut in a saturated market.'
