Bloomberg News

China Unicom Says 3G Sales to Pass 2G as Largest Revenue Source

May 29, 2012

China Unicom (Hong Kong) Ltd. (762), the nation’s second-largest mobile-phone company, said it will see a larger revenue contribution from its third-generation network than from 2G subscribers for the first time this year.

Sales from users of the company’s 2G network may post a small drop this year from the 70.6 billion yuan ($11 billion) recorded last year as more subscribers shift to the high-speed 3G service, President Lu Yimin told reporters at a briefing in Hong Kong today after the company’s annual shareholders meeting. The 3G unit contributed 32 percent of mobile revenue last year, with the rest coming from 2G users, the company said in March.

Chairman and Chief Executive Officer Chang Xiaobing has lured users to Unicom’s third-generation wireless network with smartphones from domestic suppliers including ZTE Corp. (000063) priced at less than 1,000 yuan ($158). The low-cost handsets helped Unicom’s subscriber base expand 20 percent from a year earlier in each of the first four months of 2012, even after the Beijing-based company lost the advantage of being the nation’s only carrier to offer Apple Inc. (AAPL:US)’s iPhone with a service plan.

“We are not as focused on the number of new users, we want to make sure we are adding good quality customers,” Lu said.

Unicom’s 3G business will be profitable this year, Chang said at today’s briefing, reiterating an outlook given in March. He didn’t provide details.

Unicom’s 3G subscribers totaled 51.8 million at the end of April, trailing China Mobile Ltd. (941)’s 61.9 million, according to data the companies released this month. Unicom’s total mobile customer base of 212.8 million was less than half the 672.5 million at China Mobile.

To contact Bloomberg News staff for this story: Edmond Lococo in Beijing at elococo@bloomberg.net; Mark Lee in Hong Kong at wlee37@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net


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