China Telecom Sector: Telecoms report revenues of 1.05 trln yuan
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China's three major telecom operators reported total revenues of 1.05 trillion yuan in 2017 despite significant cuts in communications fees. The growth was up 3.5 percent year on year but slower than in 2016. Mi Jiayi has more.
China Mobile, China Unicom, and China Telecom saw a total revenue of 1.05 trillion yuan, or approximately 166 billion US dollars in 2017, up 3.5 percent from a year ago, slower than their growth in 2016. Telecommunication services, including phone calls, text messages and the internet, made up more than 90 percent of the total income. Notably, the three telecom operators cancelled the roaming and long distance fees for making phone calls to a non-local number in September last year, and they are considering a cut in internet roaming fees this year as well. This would mean a lot to users, especially those who are on the move all the time.
XUE ZHENHUA "I'm a courier. I make an average of 100 phone calls every day. Some 50 or 60 parcels arrive here every day, and sometimes you have to call people twice before they come to pick things up. More than ten of the calls can be to non-local numbers. The cut in phone roaming fees has saves me a good amount."
WANG JIAJIE My monthly bill includes two things - one is calls to the car app, that's 68 yuan for 4 gigabytes of data, and I use it to check the traffic and maps. And then I have a private phone. The two together cost me more than 200 yuan, for 10 gigabytes of data. That's plenty.
China has been pushing the 4G internet for years. Data from the Ministry of Industry and Information Technology show that as of February this year, users of the 4G internet hit 1.03 billion, meaning that seven out every ten people in the country use it. An average Chinese uses 1,775 megabytes of internet data every month, 2.3 times the amount in 2016. That number is expected to grow even further, as the government wants to see further cuts in internet fees. At the same time, however, the telecom companies are actively deploying the 5G internet, which means upgrades in infrastructure and mobile phone chips. That will all eat into their profits. What can they do to protect their income?
HE RENLONG, CHIEF SCIENTIST CHINA ACADEMY OF INFORMATION AND COMMUNICATIONS TECHNOLOGY "Our telecom operators now are putting too much emphasis on their private customers. They are working on all kinds of combo offers, whether it's to family or individuals. The next big thing is the Internet of Things, though, and it's a really big market. Telecom operators should change the focus of their business. They not only should seize the market to lay out basic infrastructure, but also should work on bringing services to the big corporate end users with IOT solution and IOT networks. This would give more value than their current business."
Chinese Premier Li Keqiang has called on the telecom operators to cut their internet data fees by 30 percent. The three major operators have said they will meet that target by the end of this year.