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China Unicom 3G Base Accelerates

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glass_halfull January 20, 2011 (Chinavestor) China Unicom (NYSE:CHU), the second largest mobile carrier after China Mobile (NYSE:CHL), reported operational for December 2010 as follows. The company added 617,000 new 2G subscribers bringing its total up to 53.366  million. The same time, China Unicom added 1.284 million new 3G or smartphone subscribers up to 14.060 million in total. The fixed line segment continued to erode and is now under 100 million users while the broadband segment reported a lackluster growth.

Investors are most concerned about the mobile segment though as China is more wireless than wired. The glass looks half full rather than half empty when it comes to the mobile segment.

The bad news is that 2G customer growth remains slow - actually the slowest among China's telecom triumvirate: China Mobile (NYSE:CHL), China telecom (NYSE:CHA) and China Unicom (NYSE:CHU). The yellow line represents growth - and the trend is not encouraging, as the following chart testifies.

CHU_2010dec_2g

The good news is that the smartphone segment saw a much more robust growth in December. China Unicom (NYSE:CHU)  accumulated 14.060 million customers by the end of 2010, up 1.284 million in December alone, marking its best month ever.

CHU_2010dec_3g

The good news is that December wasn't just a standalone month but rather an accumulation of events, as the chart above testifies. The red line represents growth from month to month and is clearly showing acceleration.

Investors took note of the good news, helping the stock weather the storm in Hong Kong on Thursday despite a broad sell-off.



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