Mobile Booms in China

9:00 AM -- In the month of January alone, China Mobile Communications Corp. added a whopping 7 million subscribers, bringing its total number of subscribers to 376.3 million. Analysts, who estimate that China Mobile will add 6 million customers per month on average in 2008, attribute the January boost to the Chinese Lunar New Year festival and continued fixed-to-mobile migration in the country. (See China's Illicit iPhones and China Mobile Joins LTE Threesome.)

Smaller mobile rival, China Unicom Ltd. (NYSE: CHU), meanwhile added a relatively less impressive 1.4 million GSM and CDMA customers in January. China Unicom's has a total of 121.7 million GSM subscribers and 42.2 million CDMA subscribers. See here for more details on China Unicom's January net additions.

While mobile subscriber growth soars in China, an expected market restructuring and 3G license awards are still big unknowns for the market. The Chinese government is expected to introduce a radical restructuring that could see China Unicom's GSM and CDMA businesses split up and merged with fixed line operators China Netcom Corp. Ltd. (NYSE: CN; Hong Kong: 0906) and China Telecom Corp. Ltd. (NYSE: CHA). (See Major Carrier Shakeup Expected in China and PicoChip Unveils Chinese Femtocell.)

Such a restructuring could pave the way for Vodafone Group plc (NYSE: VOD), which has a 3.3 percent stake in China Mobile, to gain a bigger share in the Chinese market. For now, though, Vodafone's CEO Aurn Sarin said in a recent interview that his company's small stake in China Mobile is worth $12 billion and that this puts the operator in a good position for any future market restructuring.

— Michelle Donegan, European Editor, Unstrung

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