China Mobile profit rises amid growth in mobile Web access

China Mobile saw profit increase by 3.9 percent in 2010 as the carrier added 61 million customers during the year

China Mobile, the country's largest mobile carrier, reported a 3.9 percent increase in profit for 2010, as more of its customers access the Web via their mobile phones.

The carrier's profit reached 119.6 billion yuan (US$18.2 billion) according to the company's annual financial results released on Wednesday. Revenue for China Mobile rose 7.3 percent to 485.2 billion yuan ($73 billion).

At the end of 2010, China Mobile had 584 million customers, an increase of 61.73 million over the course of last year. China Unicom, the second-largest mobile carrier in the country, had just 170 million cellular subscribers in January.

China Mobile continues to grab many of its new customers from the country's rural and migrant markets. But the carrier also saw gains in revenue boosted by increases in mobile Internet usage. China Mobile customers increased the amount of data they accessed from the Web by 112.3 percent compared to 2009. Revenue from mobile Internet access rose by 49.4 percent to 30.5 billion yuan ($4.6 billion).

China Mobile will, however, face ongoing pressure from rivals, as well as technology firms cutting into its market. Handset manufacturers such as Apple have done so by popularizing their own app stores, taking potential revenue away from mobile carriers.

China Mobile opened its own app store in August 2009. The carrier's Mobile Market features a total of 50,000 apps and has achieved a total of 110 million downloads. This has helped boost revenue generated from the company's data products.

Growing sales of smartphones in China are expected to lead to an increase in mobile Internet access and data usage. China Mobile has been vying to tap that market through its 3G (third-generation) mobile network, which it launched in January 2009.

Since then, the carrier has drawn the most customers to its 3G network in China, with 22.6 million users. But analysts have said, in the past that China Mobile offered generally weaker smartphone devices compared to its rivals China Unicom and China Telecom.

China Mobile's 3G network operates on a technology standard known as TD-SCDMA (Time Division Synchronous CDMA), which is not used outside of the country. As a result, many popular handsets like Apple's iPhone cannot use the carrier's 3G network.

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Michael Kan

IDG News Service
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