HONG KONG -(Dow Jones)- China Mobile, the Hong Kong-listed unit of China's largest mobile carrier by subscribers, said Monday it added a record 5.60 million customers in July, up from 5.53 million new subscribers in June.
China Mobile's record customer additions in July illustrates the success of its rural penetration strategy and its efforts to capture customers of its smaller rival, China Unicom.
China Unicom said Friday it added 1.46 million customers in July, down from 1.54 million new subscribers in June.
DBS Vickers Securities analyst Steven Liu said China Unicom is expected to continue losing market share to China Mobile in the second half of the year.
"China Unicom can't compete with the dominant China Mobile. China Mobile has better services and a stronger brand name," he said.
Liu said China Unicom is losing customers to China Mobile after it cut handset subsidies earlier this year to maintain profitability.
China Mobile said 5.22 million of its new customers in July were prepaid subscribers and 380,000 were contract customers.
As of end-July, China Mobile's subscribers totaled 337.97 million, up from 332.4 million at the end of June.
Liu said more than half of China Mobile's total subscribers are from rural areas. More Chinese will likely subscribe to China Mobile's services because of its wider network coverage in China, he said.
Lehman Brothers analyst Paul Wu said in a research note China Mobile's strong subscriber growth will likely continue this year.
"Given the current growth rate, we believe that China Mobile is on its way to beating our estimate of 63 million net new subscribers for 2007," Wu said.
-By Lorraine Luk, Dow Jones Newswires; 852-2802-7002; lorraine.luk@dowjones.com
(END) Dow Jones Newswires
Posted to the site on 20th August 2007
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