Hong Kong's dominant telecommunications carrier PCCW has lost more than 30,000 lines per month for the past four months, according to an internal report by a rival operator obtained by the South China Morning Post. Based on the report, PCCW suffered the worst deterioration in its core fixed-line business in the third quarter, losing 3 per cent of its total lines to competitors. PCCW chief operating officer Mike Butcher rejected the figures, saying the company had not lost that many lines in any month. Mr Butcher said the company's churn rate - the proportion of customers who cancel their service - had returned to normal, and total lines lost for the whole of the year would be roughly the same as last year. 'We know about it, we expect that to happen, we are no longer a monopoly in a fully deregulated market and do not expect to hold on to the market share,' he said. However, two other fixed-line operators said the figures obtained by Business Post provided a fair description of the market situation. The figures raise questions over the sustainability of PCCW's share of the fixed-line market, on which it relies heavily to generate profits and pay its debts. PCCW shares closed at a record low of HK$1.01 on Friday and are down 53.02 per cent in the year to date. If the churn rate continues at the same pace as in the third quarter, PCCW will have lost more than 350,000 lines, or 10 per cent of the total, this year. At the end of June, the company said it had 87 per cent market share with 3.35 million fixed lines, comprising 1.41 million residential lines and 1.93 million commercial lines. The number of PCCW users switching to other large operators - particularly No 2 operator Hutchison Global Communications and Wharf New T&T - significantly increased in August after the company lost more than 48,000 lines, more than 40 per cent of them to Hutchison. Last month, PCCW lost 31,500 lines, similar to the level it recorded in June and July when it lost between 31,000 and 31,500 per month. Mr Butcher said PCCW was increasingly winning more customers back to its network because of its service quality. According to the rival operator's statistics, PCCW received 3,500 lines from competitors, or about one-tenth of the lines it lost last month. An industry executive said the report, which tracks lines switching between operators, represented about 85 per cent of the total market, and did not account for users that applied for new numbers. He said about 70 per cent of lines with new numbers went to PCCW, with the rest divided among the remaining four second-network operators. Both fixed-line and mobile users paying monthly subscriptions fell this year as the poor economy prompted people and businesses to cut telephone expenses. Commercial users dropped fixed lines as bankruptcy and layoffs increased, while residential users found it cheaper to switch to mobile when using voice services. According to statistics from the Office of the Telecommunications Authority, there were 3.87 million fixed lines in June, down 1.26 per cent from the start of the year when the figure stood at 3.92 million. Mr Butcher said PCCW was performing significantly better than European counterparts such as British Telecommunications, which lost 40 per cent of market share after seven years of deregulation.