China Mobile expects lower capex in coming years

HONG KONG Nov 18 (Reuters) - China Mobile (0941.HK), the world's largest mobile carrier, said capital spending in the next few years will be lower than in 2008 as its growth has slowed and purchase prices have fallen.

"One of the reasons (for lower capital spending) is that the company's growth is slower compared with previous years -- this is undeniable," Chairman Wang Jianzhou told reporters.

Volume growth in China Mobile's voice service slipped to about 20 percent from 30-40 percent last year. Wang also attributed the lower capital expenditure to falling purchase prices and because 3G network expenditure was paid by its parent company.

"But the drop (in capex) will not be big since the company will continue to develop internet sevices and other new businesses," he said.

China Mobile has said capital expenditure in 2009 will fall to 133.9 billion yuan ($19.62 billion) from 136.3 billion yuan in 2008.

Wang also said China Mobile aimed to reduce power consumption by 20 percent per user by 2012, compared with 2008 levels, as part of a broader industry drive to create a more sustainable global mobile industry.

The company would achieve 11.8 billion kilowatt hours in saved electricity if it met its goal, he added.

One area for potential savings is in base stations. The company has 500,000 base stations in China, but only around 2,000 use renewable power systems.

Analysts say rising competition among the three major Chinese mobile operators -- China Mobile, China Unicom (0762.HK) and China Telecom (0728.HK) -- could inflate their handset subsidies.

Wang said he could not give a handset subsidy figure for 2010 as the company was still working on the numbers. He said it would spend 12 billion yuan in subsidies this year against 8 billion yuan in 2008.

Rival China Unicom launched sales of Apple's (AAPL.O) iPhone in China last month, while China Mobile, which has shown interest in selling the iPhone, said it was still in talks with Apple.

Wand said besides advanced high-end and mid-range priced handset projects, the company would not neglect the lower end of the market and would launch handsets costing less than 1,000 yuan.

China Mobile will display five handset models with prices below 1,000 yuan in Shenzhen on Thursday. (Reporting by Joanne Chiu and Doug Young; Writing by Alison Leung; Editing by Chris Lewis)