PHS Shutdown to Affect Operator Revenues
News Express, 2/26/09
An industry source has stated that the 2009 business results of China Unicom (NYSE: CHU; 0762.HK; 600050.SH) and China Telecom (NYSE: CHA; 0728.HK) branches in prefecture-level cities will be affected by the Ministry of Industry and Information Technology (MIIT)'s request that the PHS network be shutdown before 2011.
The source mentioned that at its peak PHS took in RMB 50-60 bln in revenue per year, accounting for 25% of total fixed-line network revenues. Currently the figure is around 10% - 20%, although in a number of prefecture-level cities, it is significantly higher. Average monthly revenue per user (ARPU) for PHS is approximately RMB 50, relatively high compared to fixed-line ARPU, so revenues will be heavily affected by a drop in PHS subscribers.
Despite the fact that the MIIT recently issued an order to all operators that they were not to accept new PHS subscribers, this week it was still possible to sign up for a PHS account in most cities across the country.
Keywords: 0728.HK 0762.HK 600050.SH ARPU CHA China Telecom China Unicom CHU MIIT PHS PHS subscribers revenue telecom
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