Mobile internet demand drives China Mobile first half profit up by 4.2 per cent

CHINA Mobile, the world's largest phone carrier by subscribers, has announced today that its first-half profit rose 4.2 per cent – fuelled by growing demand and the rollout of mobile internet services.

Profit was 57.6 billion yuan ($8.4 billion) for the six months up until June 30, the Beijing-based company said. Revenue was up 7.9 per cent from a year earlier at 229.8 billion yuan ($33.6 billion).

China Mobile's profit and customer growth has slowed from the double-digit levels of recent years in a saturated market. Beijing restructured its telecoms industry into three groups in 2008, each with mobile and fixed-line assets, to revive competition and speed industry development.

"The group's development faces new challenges amid the already high mobile penetration rate and the intensifying competition in China's telecommunications market," said chairman Wang Jianzhou in a statement.

China Mobile said it added 31.8 million accounts in the first half to bring its total to 554 million.

The company has promoted non-traditional services such as mobile internet to drive revenues – today’s announcement says that strategy is paying off.

The company said its mobile internet shopping service, Mobile Market, launched in August 2009, has signed up 5 million customers and the number was growing at a 60 per cent annual rate.

Qian Xiaoqian, Deputy Director of the State Council Information Office, said online shopping is now extremely popular with more people are using the service. China now boasts over 420 million internet users and about 130 million shop online, said the report.

Mobile Internet access data usage is growing rapidly and becoming an important driver of future growth for our value-added business," Wang said.

The company said it was likely to benefit from the Chinese government's effort to develop China's rural areas and poor West and to promote domestic consumption to ease reliance on exports and investment.

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