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China Unicom 3G Service to Break Even in 2010

Caijing, 1/21/10

On January 19 at the 2009 UBS Greater China Conference in Shanghai, a senior executive of China Unicom (NYSE: CHU; 0762.HK; 600050.SH) said that China Unicom will continue to pursue its 3G strategy of focusing on the high-end market and controlling costs. By maintaining a focus on high-end, high bandwidth consumers, China Unicom expects ARPU from its 3G users to remain above RMB 100. The source added that in 2010 China Unicom's 3G service earnings before interest, taxes, depreciation and amortization (EBITDA) will break even, helping China Unicom balance the cost of terminal subsidies. Handset subsidies and commission costs will not exceed 30% of total 3G revenues, with subsidies remaining at approximately 20%.

Keywords: profit China Unicom ARPU handset strategy wireless 3G 0762.HK 600050.SH CHU high-end subsidy revenue

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