Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: samim anbarcioglu who wrote (91926)	1/15/2001 7:09:32 PM
From: William Hunt	Respond to of 152472

Unicom in $14b CDMA network upgrade Tuesday, January 16 6:31 AM SGT China United Telecommunications (Unicom), parent of Hong Kong-listed China Unicom, is expected to spend 15 billion yuan (about HK$14.05 billion) to upgrade its Great Wall Mobile CDMA network, according to analysts who met with company executives. The parent company was also planning to inject the Great Wall CDMA network into the Hong Kong-listed vehicle after the business became profitable, the analysts said. In a recently released research report, DBS Securities quoted China Unicom executive director Li Zhengmao as saying the parent company is to develop a 2.5 generation CDMA network for the Great Wall network to capture high-end users. The Great Wall CDMA mobile network was formerly an army network which the Chinese Government injected into the parent company, China's second-largest telecoms operator, on January 2. The upgrading of Great Wall's network will allow China Unicom to provide high-speed transmission of up to 384 kilobits per second (kbps), compared with GPRS (2.5G GSM network's) 115kbps. China Unicom is conducting a feasibility study and network planning exercise on Great Wall's assets. The company estimated that it would need to spend about 15 billion yuan to develop a network with a capacity of 10 million subscribers. The Great Wall network now has about 550,000 subscribers. Mr Li had told analysts that the new Great Wall CDMA network would not directly compete with Unicom's GSM business, but would target mainly high-end users, especially the data services market. Unicom's GSM spectrum has a maximum capacity of 60 million subscribers, which would not be enough for long-term development, while the Great Wall CDMA network would offer extra capacity, DBS quoted Mr Li as saying in its report. Mr Li hinted to analysts that the parent company might consider injecting the Great Wall CDMA network into China Unicom when the network became profitable. However, Mr Li told Business Post the parent company was still reviewing the CDMA network development plan, and no solid business plan had yet been formed. DBS forecast that the injection of Great Wall Mobile would not take place until next year. Analysts expected China Unicom to acquire its parent's mobile assets in 19 provinces within this year. This would allow the parent to raise funds to finance the capital expenditure required for upgrading and expanding the Great Wall network. The mobile assets in the 19 provinces, which have about five million subscribers, could be worth about US$10 billion, according to analysts. Meanwhile, Goldman Sachs raised China Unicom's ebitda estimates by 2.4 per cent for 2000 due to a higher cellular subscriber forecast, and 0.4 per cent for this year on account of the lower leased-line costs. However, Goldman has cut China Unicom's 2002 ebitda forecasts by 2.8 per cent due to the longer-term negative impact of leased-line tariff reductions on China Unicom's long-distance and data services. Both Goldman and DBS maintained a market outperformer rating and a buy recommendation on the stock. Goldman has reduced China Unicom's 12-month share price target to HK$19, versus HK$22.25 previously, Shares in China Unicom lost 30 HK cents, or 2.58 per cent, to close at HK$11.35 yesterday. BEST WISHES BILL FROM RAGING BULL