KraneShares Weekly

China Mobile to Quickly Adopt iPhone 6

During its recent earnings announcement China Mobile, the world’s largest wireless network operator by number of subscribers, says it will be one of the first operators to offer Apple’s iPhone 6, which is expected to be launched later this year

Total subscribers of the Beijing-headquartered company reached 790 million in the first half of this year, 23.4 million more than at the end of last year. Users of its 4G services reached 20.4 million by the end of last month, up from 13.9 million in June.

The company’s chairman said the contribution of the 4G business was already noticeable, and the impact would be even more obvious in the second half.

The average revenue per user (arpu) of 4G is 143 yuan (~$23.28), compared with the 64 yuan arpu for overall subscribers. China Mobile hopes to have 50 million 4G users by the end of the year, and to have sold 100 million 4G handsets. It sold 22 million 4G phones in the first half of the year.

China Mobile is building the world’s biggest 4G network. Its base-station network reached 410,000 in the first half, covering more than 300 cities, and is expected to exceed 500,000 by the end of the year.

China Opens Up to Global Delivery Services

After years of waiting, United Parcel Service (UPS) and FedEx Corp have received licenses in China to extend domestic express package services to Beijing and other cities without needing joint-venture partners according to Reuters.

The U.S. companies had been waiting for permission to independently courier packages from businesses to consumers (B2C) via their entire Chinese networks, since a 2009 postal law largely restricted foreign firms to delivering packages from abroad.

The licenses increase access to a market second in size only to the United States. Due to online shopping, the Chinese market is growing 60 percent annually and next year could be worth 280 billion yuan ($46 billion), according to consulting firm Deloitte.

Neither company has disclosed the size of their businesses in China, where since 2009 they have mainly handled documents and packages to and from overseas. But both companies have cited China as one of their fastest-growing markets.

But even at full strength, UPS and FedEx are still expected to face daunting competition from state-backed China Post and large, privately run rivals such as Shentong Express and S.F. Express.