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China Telecom to Reduce Subsidies on Low-End Handsets

Netease Tech, 1/21/10

China Telecom (NYSE: CHA; 0728.HK) deputy general manager Yang Xiaowei has said that China Telecom will adjust its terminal development strategy in 2010, and will no longer offer large subsidies for low-end handsets, instead switching its focus to RMB 1,000 - 2,000 mid- and high-end CDMA terminals. According to Yang, China Telecom will offer its support to any 3G handset priced in the RMB 1,000 price bracket that meets market demands, regardless of manufacturer.

Editor's Note: At China Telecom's 2010 Annual Work Conference, the company decided to promote non-operator sales channels for its E-Surfing terminals, making mid- and high-end terminals the company's new sales focus. To this end, China Telecom is preparing four "quad-channel" handsets supporting CDMA1X, EV-DO, WAPI and Wi-Fi.

In related news, according to informed sources, China Telecom is preparing to reduce its capital expenditure in 2010 by RMB 25 bln compared to 2009, with a focus on investment in China's northern regions.

Keywords: Yang Xiaowei China Telecom subsidy handset strategy wireless 3G E-Surfing low-end 0728.HK CHA high-end capex CDMA2000 EV-DO

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