China Unicom (Hong Kong) Limited (NYSE: CHU, SEHK: 0762, and SHSE: 600050) recently announced that its WCDMA network have covered 335 cities across the country.

Since gaining the 3G license in early 2009, the telecom carrier has been in leading positions in WCDMA network construction and network scale.

On the last day of the year 2009, China Unicom said that the WCDMA network built in the phase two project, covering 50 cities, were qualified for commercial use. Official 3G commercial use was kicked off in those cities in recent days.

Apart from network deployment, China Unicom launched various kinds of 3G applications, like mobile phone Internet access, mobile phone TV, as well as mobile phone music. In future, the telecom carrier will successively launch more innovative 3G applications such as application store and mobile payment, in an attempt to offer users with high-quality experience.

China Unicom had had a subscriber base of 146 million by January 31, 2010. Notably, the company, which officially started 3G commercialization in the country months ago, saw the number of its 3G users arrive at 3.595 million. 3G users increased 853,000 in January 2010, outpacing the 2G user growths for three consecutive months. In addition, earlier data showed that China Unicom's 3G users rose 801,000 in November 2009, higher than the growth in 2G users for the first time. Its 3G users ascended 920,000 in December 2009, more than the increment in 2G users for the second time.

China Unicom's 2G users and broadband users grew sluggishly and the fixed-line phone users continued reducing in January 2010. By the end of the month, the telecom operator's local phone users decreased 300,000 to 102.5 million while broadband users climbed 965,000 to 39.515 million.

In mid January 2010, an executive for China Unicom said that the company is expected to make ends meet on its 3G business this year.

In order to achieve the goal, China Unicom is set to keep the total of its 3G customer subsidies and commission expenses below 30% of its overall 3G revenues, with the customer subsidies remaining around 20% of the revenues, in particular.

The telecoms operator will mainly aim at high-end users with demands for large data stream in the Chinese 3G market, as an effort to sustain an over CNY 100 monthly average revenue per user (ARPU) on the business.

Industry insiders forecast that the number of 3G users in China will grow fast this year. If China Unicom keeps its growth pace, its 3G users will be likely to increase 1 million per month.

source:tradingmarkets