China Unicom Says CDMA Goals "Tough"

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China Unicom Says CDMA Goals "Tough" But Still Pursuing

By Loretta Ng

HONG KONG (Dow Jones) - China Unicom Ltd. (0762.HK) sees a "challenge" in meeting its target of 11.4 million net additional code division multiple access, or CDMA, subscribers this year and achieving breakeven for the division.

"It is a tough challenge (to hit the targets)," Executive Vice President Shi Cuiming said. "We're still working very hard (for the goals)."

China Unicom's 22-month old CDMA division added only 7.098 million subscribers to its network between January and end-September.

The company, China's second largest mobile operator, decided in early 2003 to scale back handset subsidies to help meet its targets. Later in the year, it launched a prepaid system and started buying CDMA handsets in bulk at lower prices, in an attempt to cut customer cost and stimulate demand.

Analysts are concerned about the performance of China Unicom's key CDMA unit in Guangdong province, where it has been locked in a fierce competition with China Mobile (Hong Kong) Ltd. (0941.HK) and China Telecom Corp.'s (0728.HK) Little Smart service, a cheap wireless alternative to mobile phones.

© 2003 Dow Jones & Company, Inc.