The total capital expenditure of the mainland's four largest communications operators will remain flat this year, reaching about US$25.6 billion, despite improving growth prospects. The conservative investment strategy will prevail because mainland authorities are looking to delay the issuance of third-generation (3G) cellular communications licences until next year, according to Beijing-based consultancy and research firm BDA China. China Unicom, the second-largest nationwide cellular operator, is the only one expected to increase capital spending as it continues to aggressively expand the coverage and capacity of its code division multiple access network. BDA China estimated that China Unicom would lower capital spending for its global system for mobile (GSM) operations to $519 million this year. Rival China Mobile is also expected to slow down its GSM infrastructure spending, which is forecast to peak at $3.3 billion. Fixed-line network operator China Network Communications plans a sharp 12 per cent reduction in capital expenditure as it aims for profitability ahead of its planned initial public offering. Larger rival China Telecom plans to maintain its capital spending at last year's levels, focusing primarily on its broadband internet expansion and its low-cost, city-based xiaolingtong mobile service. Lower capital spending had been adopted by nationwide carriers in recent years as a result of the structural shift in China's telecoms industry, BDA China said. The focus on building new networks and expanding capacity had switched to optimising networks, increasing efficiency and launching new services. The shift began in 2001, when total capital investments by China's nationwide carriers hit $32 billion. China's Ministry of Information Industry (MII) described that year as the high point of investment in the sector. BDA said that lofty level of capital expenditure would not be reached again until 3G networks were deployed. But the MII still expects China's telecoms sector to enjoy user growth this year, with carriers adding about 92 million new users - 10 million more than previously forecast. The regulator also expects operator revenues to increase 12.3 per cent over the year. The ministry expects the fixed-line telecoms sector to add 40 million users this year, up 21 per cent from an earlier forecast of 33 million. The cellular service sector is expected to grow 18 per cent, with 52 million new subscribers over the earlier predicted 44 million.