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China Telecom will invest CNY 61 billion in 4G network construction in 2015
Time:2015-4-28    Close

In the 2014 annual performance news conference, the chairman of China Telecom Wang Xiaochu said that the operator’s capital expenditure would reach CNY 107.8 billion in 2015, with an increase of 40% by comparison with 2014. CNY61 billion of the capital will be used in 4G network construction, including both TDD and FDD standards. As we have learnt, its capital expenditure for mobile business would be CNY63 billion in 2015. That is to say, the capital for 4G network construction accounted for 97% of the mobile business.

According to the annual report that released by China Telecom, mobile subscribers of China Telecom has reached 186 million in total by the end December 31st, 2014, with a net increase of 40,000 in 2014, which was almost negligible. In other aspects, China Telecom 2014 annual revenue growth was 0.9%, and the net profit increased by 0.8%, both of which were less than 1%.

After the ignorable development of subscribers in 2014, the gap between China Telecom and the current leader China Mobile continued to widen bigger, especially in the 4G subscribers, which can’t compare with China Mobile. China Telecom has develop about 186 million mobile subscribers by now, namely about 14% of the total mobile subscribers in China, which is also below the red line that set inside China Telecom.

Moreover, 15% is not the goal that China Telecom pursuits in this year. In the performance news conference that held in yesterday, Wang Xiaochu just simply said that since FDD license has been issued, subscribers growth is expected to be better than last year. But he pointed out at the same time, judging by the experience of foreign markets, telecom operators should get at least 25% of the market share, only after that will the business enter a steady growth stage, "China Telecom also takes this as the goal".

The growth of subscribers comes from two aspects, one is the develop of new ones, the other is the migration of subscribers from other operators. According to the analysis of senior expert Ma Yihua, domestic mobile telecom industry has entered a saturation mode from 2014, and the increase of subscribers was mainly from other competitors.

For China Telecom, the user structure has become very excellent after the adjustment in 2014, in which the 3G/4G subscribers were of 119 million, taking a proportion of 64% in total mobile subscribers. What China Telecom needs to do now is to build a high quality 4G network, and attract 2G and 3G subscribers, even 4G subscribers from other telecom operators.

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