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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: slacker711 who wrote (32683)	2/20/2003 9:24:01 AM
From: slacker711	Read Replies (1) \| Respond to of 196851

Unicom's New Cell Users for Qualcomm System Decline (Update1) By Kenneth Wong quote.bloomberg.com Hong Kong, Feb. 20 (Bloomberg) -- China Unicom Ltd., the country's second-biggest mobile-phone company, added fewer subscribers to a year-old network for the first time after the company cut back on free handsets. Unicom added 602,000 customers to its code division multiple access system in 12 wealthier provinces, down 23 percent from December, the company said on its Web site. Unicom spokeswoman Sophia Tso attributed the decline to a change in marketing strategy that's paring down subsidized handsets. ``They're now chasing profitability rather than just subscriber numbers,'' said Colin McCallum, an analyst at HSBC Securities Asia Ltd. ``That's got to be good for shareholders.'' Unicom is trying to make the network profitable after a year of handset subsidies to meet subscriber targets led to losses. Promotions for the service, based on Qualcomm Inc.'s technology, lured customers from bigger rival China Mobile (H.K.) Ltd. and slowed user growth at its own service based on global system for mobile communications, China's dominant standard. Unicom today for the first time posted subscriber numbers for nine additional provinces bought from its state-owned parent, which gave the company the same number of networks as China Mobile. Unicom said it had 54.7 million GSM customers in 21 provinces at the end of January, after adding 1.2 million last month. It had 7 million CDMA customers, having signed up 770,000 in January. Unicom's Hong Kong-traded shares, up 0.9 percent this year, fell 2.7 percent today to HK$5.35. China Mobile shares fell 0.3 percent to HK$18.25. The stock is down 1.6 percent this year. CDMA-1X ``All Unicom has to do is to launch prepaid service in a few months,'' McCallum said. ``That will bring growth back.'' More than 90 percent of new cell-phone users in China buy prepaid cards, which isn't yet available for Unicom's CDMA services. Prepaid card customers don't pay monthly subscription fees and tend to talk less on the phone. Starting next month, Unicom plans to offer services such as picture mail and video clips on its upgraded CDMA network called CDMA-1X. ``The launch of value-added services in March will drive growth,'' Tso said. The cut in Unicom's handset subsidies means less competition for China Mobile, which said it added 2.1 million new users in January, bringing the total to 119.8 million. China Mobile sells only GSM services in 21 provinces. Parents of the two Hong Kong-listed companies serve the rest of China, the world's biggest wireless market with 207 million cell-phone users. Fixed-line carriers China Telecommunications Group Corp. and China Netcom Communication Group Corp. are expanding a cordless phone service that costs a fraction of regular cellular service, attracting the four people out of five who don't have cell phones.