Telecom & Wireless

China Mobile (CHL) Success Likely To Be Short Lived

China_2China Mobile (CHL) announced extraordinary results for the first half and it is not likely to repeat them in the future.

CHL’s 54.8 billion yuan ($8 billion) in net profit in January-June compared with 37.9 billion yuan in the first half of 2007. Revenue rose 18% to $28.7 billion.

Several things stand in the way of another remarkable performance.

First, the economy in China is showing signs of slowing. GDP is now running at about 10%, below the rate of the last five years. Inflation has stepped up sharply. For some essentials like food, price increases are as high as 15%. The amount of discretionary income left for handsets is likely to become more modest.

China does not have a nationwide 3G network, so most of the advantages of fast broadband as not available at all. According to AP, "the company’s future prospects will depend on government plans to restructure China’s telecoms market and to introduce a homegrown third-generation, or 3G, mobile phone standard."

Finally, China Mobile has 415 million subscribers in a country with just over 1.3 billion people Total cellular accounts handled by the company and its competition sum 590 million. Many rural areas do not have good enough reception to be ideal markets for wireless services. In other words, as China Mobile’s market penetration grows.

Douglas A. McIntyre

The Average American Is Losing Their Savings Every Day (Sponsor)

If you’re like many Americans and keep your money ‘safe’ in a checking or savings account, think again. The average yield on a savings account is a paltry .4% today, and inflation is much higher. Checking accounts are even worse.

Every day you don’t move to a high-yield savings account that beats inflation, you lose more and more value.

But there is good news. To win qualified customers, some accounts are paying 9-10x this national average. That’s an incredible way to keep your money safe, and get paid at the same time. Our top pick for high yield savings accounts includes other one time cash bonuses, and is FDIC insured.

Click here to see how much more you could be earning on your savings today. It takes just a few minutes and your money could be working for you.

 

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.