“China Telecom and China Unicom are set to further narrow the gap in 3G subscribers with bigger rival China Mobile when Apple launches the iPhone 5 in the world’s largest smartphone market as early as this quarter,” Lee Chyen Yee reports for Reuters.
“China Mobile Ltd leads in 3G user numbers, but China Telecom Corp Ltd and China Unicom (Hong Kong) Ltd are ahead in monthly subscriber growth by percentage, according to September data released over the past week, partly because China Mobile’s unique 3G network is incompatible with earlier iPhone models,” Yee reports. “However, hefty handset subsidies doled out to attract new 3G users will pressure margins, analysts warn. China Telecom, which sealed a deal with Apple Inc in February to sell iPhones, said on Monday that its net profit declined for the third consecutive quarter due to increased subsidy spending… China Telecom, the smallest of China’s mobile operators, posted a third-quarter profit drop of 7 percent, lagging China Mobile’s 1.3 percent gain and China Unicom’s 27 percent rise.
Yee reports, “China Mobile is the only Chinese carrier without an iPhone contract because of network incompatibility, although the iPhone 5 contains a Qualcomm Inc chip that supports the operator’s homegrown TD-SCDMA standard. Apple, which counts China as its biggest iPhone market after the United States, plans to launch the iPhone 5 in the country in December.”
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