UPDATE 3-China Mobile Q2 beats f'cst, to offer 3G by June '09
(Adds executive and analyst comments)
HONG KONG, Aug 27 (Reuters) - China Mobile (0941.HK) beat forecasts with quarterly profit growth of 51 percent, lifting its shares 4 percent, and said it will begin offering long-awaited 3G services across the world's top telecoms market by June 2009.
On Wednesday, the world's largest wireless carrier said it would launch high-speed, third-generation services in 38 cities by the end of June 2009, marking the first large-scale rollout of 3G for the country, ahead of rival Unicom (0762.HK).
Shares in China Mobile jumped as much as 4.3 percent to their highest in more than two weeks, as investors cheered resilient margins and the firm's fastest pace of quarterly earnings growth in about four years.
China Mobile now faces increasing competition in a shifting telecoms landscape, and pressure on traditional voice margins.
Beijing unveiled in May a sweeping industry reshuffle that will see the creation of two full-service competitors to China Mobile via mergers and acquisitions. [ID:nHKG143379]
And some analysts warn that China Mobile will face problems in overseeing the rollout and development of the untested, homegrown 3G technology, known as TD-SCDMA or Time Division Synchronous Code Division Multiple Access.
Rivals China Telecom (0728.HK), Unicom and Netcom 0906.HK will get to develop more advanced, globally accepted standards.
"The competition will of course be more intense, but each company will still have space to develop," Chairman Wang Jianzhou told reporters.
"TD-SCDMA is a few years behind other 3G technologies," he said, adding that many customers had complained that the network and handsets were unstable.
To overcome negative perceptions, China Mobile is working with global vendors such as Nokia (NOK1V.HE), Sony Ericsson and Motorola (MOT.N) to try get them to provide quality cellphones and other support.
VALUE BOOM
China Mobile posted April-June net profit of 30.7 billion yuan ($4.48 billion) versus 20.34 billion yuan a year ago, according to Reuters calculations of previously reported figures, its best quarterly growth in over four years.
That result beat an average forecast of 27.66 billion yuan according to five analysts polled by Reuters. Continued...
