China Telecom to invest $6.5b in 4G to stem sub loss

Fiona Chau
28 Aug 2014

China Telecom said Wednesday it will spend 40 billion yuan ($6.5 billion) on 4G this year to expand its LTE coverage and enhance the customer experience, as the company struggles to stem customer losses to its biggest rivals.

China Telecom, the country’s smallest mobile carrier, launched 4G service for handset in 16 cities in late July, after the company being granted a FDD/LTE trial license in June.

“Currently we have about 600,000 4G customers since the launch and the majority of them are signing up for the tariff plans at over 100 yuan/month,” chairman and CEO Wang Xiaochu told reporters at a media briefing yesterday.

The move comes after China Telecom lost 5.3 million mobile customers in the first half of the year as a result of cutbacks on handset subsidies and increased market competition driven by China's 4G launches and strengthened marketing effort by rivals China Mobile and China Unicom.

Wang said the company has built 90,000 4G base stations and aims to expand its 4G network coverage in key cities and high data traffic areas with 140,000 base stations and 60,000 indoor radio distribution systems by year-end.

“There are already 20 models of 4G smartphones covering all market segments available in the market, and the company will increase the number of 4G handset models to 50 and 100 by September and the end of the year, respectively,” he added.

Wang’s comment comes as China Telecom said its net profit grew by 12% to 11.4 billion yuan as revenue increased 5.3% to 166 billion, thanks to growth on mobile data and internet business.

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