China Unicom Maintains 2002 CDMA User Target Of 4 Million
Thursday June 20, 5:19 am Eastern Time
HONG KONG -(Dow Jones)- China Unicom Ltd. said Thursday it is maintaining its 2002 target of 4 million subscribers for its code division multiple access, or CDMA, network, despite market concerns that the aim is too high.
"We maintain our target for the CDMA network," spokeswoman Sophia Tso said.
China Unicom signed up 83,000 new CDMA subscribers in May, 38% fewer than what it signed up in April, bringing its total to 785,000.
Investors are concerned that it may not be able to reach its subscriber target, as it has signed up less than 20% of its user target in the five months since the network was launched. The company's parent, from which Unicom is leasing CDMA capacity, initially blamed the network's slow start on the handsets, and made a deal in May to buy them in bulk from China Unicom to bring down the price.
In addition, there have been renewed fears about a potentially damaging price war with its rival China Mobile (CHL) following reports of a fresh round of CDMA promotional offers. Tso said, however, the company doesn't intend to trigger any price war.
The concerns have sent the shares of China Unicom, the listed unit of mainland China 's second largest mobile phone company, down to all-time lows this week.
At around 0730 GMT ( 3:30 a.m. EDT) , the stock was continuing to extend its losses, falling 2.2% to HK$6.60. It has lost more than 23% since the beginning of the year.
Tso said that it won't lease more CDMA capacity in the third quarter, although it is undecided about the fourth quarter.
It had said earlier it might lease more capacity if there is demand.
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