Fall in fixed-line sales hurts China Telecom
29 August 2008
Net profit at fixed-line carrier China Telecom fell 4% to US$1.7 billion in the first half as the industry-wide shift to wireless services continued, Bloomberg reported. China Telecom lost 5.4 million users over the six-month period – including 600,000 in July alone – as fixed-line revenue dropped 12%. The company, which now has a total of 214.3 million fixed-line customers, cited price cuts offered by the likes of China Mobile as one reason for the decline in business. China Telecom's overall sales actually rose 1.5% to US$13.01 billion due to revenues from broadband internet services. Sales of broadband connections contributed US$19.5 billion in revenue in the first half, up 31% year-on-year. China Telecom and its parent plan to spend a combined US$16 billion on acquisitions this year to enter the mobile market. China Telecom will pay US$6.4 billion for China Unicom's CDMA mobile operations while its parent has agreed to a US$9.7 billion price for the CDMA network infrastructure.