China Mobile Competes for CDMA Group User Program Exposure

China Mobile Competes for CDMA Group User Program Exposure

"Now the CDMA network is still in the process of handover. The sooner the competition plan is implemented, the better it will be for our future competition." On July 28, an insider of a branch of China Mobile South told reporters.

On the same day, China Unicom and Telecom announced that they had signed a formal agreement on the transfer of CDMA business and assets, and the sale price of CDMA business and assets was 43.8 billion yuan and 66.2 billion yuan, respectively.

This shows that China Telecom is one step closer to the official operation of CDMA. According to data disclosed by China Unicom, as of June 30 this year, the total number of CDMA mobile users reached 43.169 million, of which 39.943 million were post-paid users. According to reporters, China Telecom is currently making arrangements for receiving Unicom's CDMA network, such as the issuance of tens of billions of corporate bonds, and bidding for equipment and terminals.

At the critical moment when telecommunications and China Unicom handed over CDMA network operations, a southern provincial branch of China Mobile was preparing a highly targeted CDMA user competition plan, which involved tariffs, terminals, channels, etc. Great discounts.

Local mobile competition scheme

"Mobile is currently the most powerful operator in the country and is fully capable of implementing this competition plan." An industry veteran told reporters after studying the competition plan of the provincial branch of China Mobile.

The bidding program that the reporters of this newspaper obtained repeatedly appeared in the form of "work plan for the second half of the year", and the key content was to compete for CDMA users at the group customer level.

The competition plan includes many aspects, and the first burden is the tariff. According to the reporter's understanding, China Mobile's branch company considered that, under the same conditions of CDMA's existing tariffs, the user's competition needs were considered, and a 10% discount was granted at the same time.

It is worth noting that the CDMA mobile phones currently used by CDMA users cannot be directly used in the GSM network currently owned by China Mobile. To compete for these users, mobile undoubtedly needs to consider terminal issues. In this regard, China Mobile's Southern Branch proposed in the competition plan that it considers that users need to update the terminal and give equal subsidies, such as equivalent GSM mobile phones or equivalent real valued goods.

Moreover, considering that the original CDMA customer is still within the agreement period, the branch of China Mobile suggested that the company pay the penalty for the customer's competition.

In addition, the competition plan also proposes to increase the remuneration policy for agents competing for users on the channel, and at the same time reward direct marketing countermeasures.

At present, China Mobile occupies a large market share in the domestic mobile communication market and has obvious competitive advantages. After this round of telecommunications industry reorganization, it is bound to face competition from New China Unicom and New Telecom and user competition. After receiving the CDMA network, the powerful China Telecom will become a rising force that cannot be ignored in the mobile communications market.

The above veteran of the telecommunications industry believes that at present, telecommunications and China Unicom are carrying out and preparing for the restructuring of the CDMA network. China Mobile's branch company proposed the user competition plan, which is obviously in the market "vacuum period".

According to the reporter's understanding, the mobile branch's competition plan will be carried out in three stages: the first batch of hundreds of group customers who have established customer relationships and more than 50 members will compete; the second batch of established relationship The remaining customers are competing; finally, competing for all group customers with more than 10 members.

"We have not yet officially implemented this plan and are still waiting for the approval of the superior." The insider of the mobile branch mentioned above told reporters that the implementation of this CDMA user competition plan requires a lot of resources and permission. For example, it involves the expansion of the terminal subsidy cost quota, the cost of paying the customer ’s liquidated damages, the incremental part of the agency remuneration and direct sales incentives, and the number resources required by the customer to transfer the network.

The source revealed to reporters that the company hopes that this user competition plan will reach more than 50% of the target users.

Aiming at "vacuum period"

"China Mobile's advantage lies in the high-end field of mobile business, including group and individual users. After Telecom takes over the C network in the future, it will inevitably have a certain impact on mobile." Chen Yunhong, an analyst at Guojin Securities Communications, believes that China Mobile's move It is intended to be preemptive.

Some people in the industry believe that in the future, the three operators of New Unicom, New Telecom, and New Mobile will inevitably continue to issue targeted marketing policies around user competition.

The industry source said that China Mobile has been competing for China Unicom's G and C users throughout the country. According to public information, the total assets of China Unicom's CDMA business were 10.29 billion yuan and 12.14 billion yuan respectively at the end of 2006 and 2007. The pre-tax profit of CDMA business was 345 million yuan and 466 million yuan in 2006 and 2007, respectively. In contrast, by the end of 2007, China Mobile had a total of 369 million users, a net increase of 68 million throughout the year, an annual growth rate of 22.6%, and a market share of 69.3%.

Chen Yunhong said, "From the announcement of the reorganization to the current period, C network is still in the hands of Unicom. The two parties will sign the contract at the end of July, and the transfer of personnel and network will only start in September." Therefore, this period of time for C The development of users of the network is a vacuum period.

According to reporters, since the end of June this year, China Telecom has sent a number of investigation teams to the country to conduct due diligence on the assets, users and income of C networks in various regions. However, because China Unicom's C and G networks have always adopted the "co-site and co-location" approach and used the same computer room in most areas, this has also brought some difficulties to the inventory work. At the same time, complex tariff systems and user quality surveys take a lot of time.

A telecommunications employee participating in the due diligence of China Unicom's CDMA network assets expects that the entire due diligence will be completed by the end of July. It is estimated that telecommunications will officially operate the CDMA business until October this year.

However, China Telecom has begun to plan ahead. In addition to accelerating the integration process, telecommunications have recently begun to prepare for the operation of the C network.

On June 19, China Telecom first convened CDMA terminal suppliers for internal communication; on July 7, it began to recruit 420 network optimization talents nationwide; on July 8, China Telecom officially joined CDMA development as a director Organize CDG; on July 9, Telecom launched high-standard C network equipment testing ...

Some industry insiders said that in the future when telecommunications operate CDMA networks, in addition to coping with similar market competitions from operators such as China Mobile, they also need to solve many of their own problems, such as CDMA terminal price issues and network optimization issues.

Competitive conjecture

"I think the focus of China Mobile's future is not how to compete for other customers, but how to keep its own achievements." Chen Yunhong believes that while China Mobile strives for existing users of other operators, it also needs to prevent the loss of its own users, especially In the high-end field of mobile business, such as group customers.

According to China Mobile ’s 2007 annual report, as of the end of 2007, its total number of group customers reached 2.12 million, and individual users included in group customer management accounted for 29.2% of the total number of users.

Some industry analysts believe that "At present, most of the large number of government and enterprise customers are now in the hands of China Mobile. In the future, new telecommunications and new Unicom with full business will greatly threaten this part of their customer inventory through combination marketing."

The analyst predicts that if active and effective marketing measures are not taken, many of China Mobile's existing users are likely to be off-grid. "Even if they are not off-grid, the cost and energy of maintaining customers will increase significantly."

At present, mobile has begun to increase investment in this area. For example, for high-value key customers, it always pays attention to competitors ’marketing policies, formulates different retention plans for subdivided customer types, and requires more than 95% of target customers. Retention rate.

For telecommunications, broadband data services and customer resources in the home and group customer markets are its biggest advantages. "Telecommunications relies on the monopoly advantage of group customers in fixed-line broadband, and supporting the launch of mobile services will pose a strong threat to China Mobile's business market." Some operators have pointed out. In addition, the integration of the original Unicom G network assets and Netcom's new Unicom can also use the integrated solution of fixed network and mobile to jointly expand large customers and accelerate the pace of siege.

In addition, Chen Yunhong also said, "In the long-term trend, the growth rate of voice services is declining, while data services are the focus of future competition, and data services in the mobile field will occupy an increasing proportion." Obviously, in addition to the competition for users, the three operators in the future will all be under pressure to innovate operations and develop new business models.

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