China Mobile (Hong Kong), the Hong Kong-listed arm of the mainland's dominant cellular carrier, says its rivals are putting their long-term profitability at risk if they continue subsidising handsets for their customers.
The warning came as No 2 carrier China United Telecommunications teamed up with handset vendors to provide more subsidised promotion packages for its code-division multiple access (CDMA) network.
China United said it had signed up one million CDMA users over the past three weeks to reach four million users as of Monday.
China Mobile chairman Wang Xiaochu said: 'We hope [China United] will change this [marketing strategy] when its CDMA operation reaches a sizeable scale.'
Mr Wang warned that handset subsidies would have a huge impact on the finances of mobile carriers and would hurt their long-term earnings.
China Mobile bought 300,000 handsets to promote the launch of its GPRS services, but Mr Wang said it would stop such promotional campaigns.
