What does the operator's first-half performance reflect about the second half of the year?

With the release of the operating data of the three major operators in June, their overall development in the first half of 2018 has also come to light. What kind of undercurrents are hidden behind the heavy data?

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First, let's take a general view. As of the end of June, the total number of mobile phone users of the three basic telecommunications companies reached 1.51 billion, a year-on-year increase of 10.6%, with a net increase of 92.29 million in the first half of the year. Among them, the total number of 4G users reached 1.11 billion, accounting for 73.5% of mobile phone users. China Mobile firmly sits on the throne of the largest number of mobile users with 906 million; its cumulative number of 4G users reached 677 million, which is far ahead of the other two operators. China Telecom also unexpectedly maintained the largest number of net increase in 4G users for three consecutive months.

In the broadband user market, apart from China Unicom, which has seen slower growth, the competition between China Mobile and China Telecom is still ongoing.

In the 4G competition, the situation of "one superpower and two strong powers" is obvious

In terms of 4G users, China Mobile undoubtedly has a huge advantage. The negative growth of 4G users in April did not hurt China Mobile's vitality. As of the end of June, China Mobile's 4G user base reached 676.8 million, ranking first among the other two operators, and its "super giant" position is quite stable.

China Unicom, which was the first to open up the road of cooperating with Internet companies to develop Internet cards, has benefited a lot. Even users who are not familiar with the industry know a thing or two about "Tencent King Card" and "Alibao Card". For China Unicom, this benefit is directly reflected in the growth of its 4G users. However, what China Unicom needs to pay attention to is whether the Internet cards that cooperate with Internet companies can continue to bring new 4G users to itself in a stable manner. Judging from the data in the first half of the year, the growth of 4G users in the first three months of the year was still remarkable, but the growth of 4G users in May and June showed a significant decline. With the cancellation of roaming fees and the launch of various unlimited traffic cards, how long can the "bonus" brought by cooperation with Internet companies last? This problem is what China Unicom has to think about and face next.

Unlike China Mobile and China Unicom, whose monthly 4G net increase in users fluctuated in the first half of the year, China Telecom's performance in the first half of the year was stable and impressive. Although China Telecom did not have an advantage in the number of 4G net increase in the first three months of this year in the face of the continued efforts of the other two major operators, in the three months of April, May and June, China Telecom's 4G net increase in users remained the largest. Currently, China Telecom's 4G user base has reached 217 million, slightly surpassing China Unicom.

In the broadband field, China Mobile is leading the pack

Data released recently by the Ministry of Industry and Information Technology showed that the total number of fixed Internet broadband access users of the three major operators reached 378 million, with a net increase of 29.74 million in the first half of the year.

Specifically, as of the end of June 2018, the total number of China Mobile's wired broadband users reached 135.073 million, with a net increase of 22.386 million customers this year. China Telecom's wired broadband users increased by 1.34 million, totaling 140.62 million. The total number of wired broadband users of China Telecom and the parent company of the Company totaled 164 million. China Unicom's fixed-line broadband users increased by 297,000 in the first half of the year, totaling 78.916 million.

Judging from the data, China Mobile is making rapid progress in the broadband sector, with a growth momentum far exceeding that of the other two. Although it is still slightly behind China Telecom in the mid-year data of this year, some experts predict that China Mobile's number of broadband users is expected to surpass China Telecom in the short term. Compared with the "secret competition" between China Mobile and China Telecom, China Unicom's development momentum in the broadband sector seems much more "Buddhist", with a relatively slow growth in broadband users.

In the future, as the demographic dividend decreases, broadband development will need to rely more on operators' management of existing users.

In the second half of 2018, innovation in stability is the way to go

The "Economic Operation of the Communications Industry in the First Half of 2018" recently released by the Ministry of Industry and Information Technology shows that the growth rate of telecommunications business revenue has slightly declined. In the first half of 2018, the total revenue of telecommunications business reached 672 billion yuan, a year-on-year increase of 4.1%, and the growth rate dropped by 0.1 percentage point from January to May. Among them, the growth rate of mobile data and Internet business revenue slowed down. In the first half of the year, the three basic telecommunications companies completed mobile data and mobile Internet business revenue of 309.5 billion yuan, a year-on-year increase of 12.8%, accounting for 46.1% of telecommunications business revenue; and completed fixed data and Internet business revenue of 105.5 billion yuan, a year-on-year increase of 7.2%.

In this report, the reporter noticed that the volume of mobile phone calls continued to decline in the first half of the year. In the first half of the year, the duration of mobile phone outgoing calls nationwide reached 1281.9 billion minutes, a year-on-year decrease of 4.6%; the duration of fixed local phone calls nationwide reached 62.8 billion minutes, a year-on-year decrease of 19.6%. Although this downward trend reflects the change in the way users communicate, it is something that operators do not want to see.

At the same time, the report also mentioned that with the popularization of services such as service login and identity authentication, the volume of enterprise SMS business has maintained a significant increase this year. In the first half of the year, the national mobile SMS business volume increased by 8.8% year-on-year; the mobile SMS business revenue reached 19.5 billion yuan, a year-on-year increase of 5.7%; the mobile MMS business volume decreased by 11.9% year-on-year. With the substantial increase in SMS business volume, it is just relying on "making clothes for others", which is really not the time for long-term development.

Fortunately, operators have never stopped innovating and changing.

For example, China Unicom recently signed a strategic cooperation agreement with MissFresh. The two parties will establish a strategic partnership in the fields of communication services, product provision, resource sharing, etc., and take the lead in opening up an innovative cooperation model of unmanned retail and communication services.

Migu, which won the live broadcasting rights for this year's World Cup, has also been in the limelight this summer. Although China Mobile spent more than 1 billion yuan on this, the advertising revenue is naturally not to be mentioned. China Mobile's broadband attractiveness and China Mobile's live video broadcasting capabilities have also been greatly improved, which can be said to be a sure win.

As the short video market continues to be optimistic, China Telecom has also cooperated with the short video industry giant Douyin to release Douyin's traffic card for cross-border marketing. China Telecom, a "telecom veteran", is also constantly injecting more youthful vitality into itself.

The first half of 2018 has ended, and the competition among operators in the second half has just begun. As time changes, so does the situation. I hope that operators can find their own new business growth points in the second half of this year.