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Profits fell by 14.6%, and revenues were unsustainable. China Mobiles new system strategy was first publicized.
Profits fell by 14.6%, and revenues were unsustainable. China Mobiles new system strategy was first publicized.
Profits fell by 14.6%, and revenues were unsustainable. China Mobiles new system strategy was first publicized.

On August 8, 2019, China Mobile released its 2019 interim results report.

The report shows that operating income for the first half of 2019 was RMB 389.4 billion, down 0.6%, of which communication services revenue reached RMB 351.4 billion, down 1.3% year-on-year; net profit was RMB 56.1 billion, down 14.6% year-on-year. After the first quarter of this year, China Mobile's revenue and net profit continued to decline.

However, the report said that China Mobile's profitability continues to maintain the leading level of the world's leading operators, and free cash flow continues to be healthy.

Mobile traffic revenue growth

The rapid decline of the traffic dividend, the intensification of market competition, the continuous increase in speed reduction and the increase in investment in transformation resources, such as the four major burdens on China Mobile, make this elephant difficult to move forward.

According to the performance report, in the personal mobile market, the mobile Internet DOU increased by 140.9% year-on-year, but the mobile ARPU value decreased by 10% year-on-year, and the mobile Internet revenue decreased by 1.5% year-on-year. This shows that the scale of the fee reduction is large and the market competition is fierce. The report shows that mobile Internet access fees have dropped by 61%.

China Mobile's press release bluntly said that as the traditional communications business market became saturated, the traffic dividend quickly subsided, relying solely on traditional factor inputs to drive performance growth unsustainable, the industry as a whole showed negative growth, and the company's revenue and profit also suffered a greater pressure.

Family and government markets maintain high growth
Despite the negative growth of 2C business, it is gratifying that China Mobile has maintained double-digit high-speed growth in the 2H and 2B markets. According to the performance report, household market revenue increased by 21.3% year-on-year, and government and enterprise market revenue increased by 15.7%.
In terms of cable broadband, the number of customers increased by 18.2 million to 175 million, and the ARPU remained stable. Among them, Mobihe reached 111 million, with a penetration rate of 68.7% and revenue of RMB6.2 billion, a year-on-year increase of 59.7%.
In the government and enterprise market, the number of government and enterprise customers reached 7.92 million, an increase of 18.1% year-on-year. It is planned to exceed 10 million in 2019, achieving rapid growth in the Group's product revenue.

First public new system strategy map

In the face of the current situation, as the demographic dividend quickly subsides, it is obviously difficult to maintain growth by relying on the traditional market. To this end, China Mobile has changed its situation and has for the first time publicly constructed a new system strategy map.
The new system is based on the original “big connection” and “four-wheel drive”. It has added the cornerstone of “full implementation of 5G+ plan”, and promotes high-quality development and world-class development with the pillars of “transformation and upgrading” and “reform and innovation”. enterprise.

Transformation and upgrading, that is, the integration, integration, and integration of wisdom as the key path, solidly promote transformation and upgrading.

Convergence refers to the expansion of market space by focusing on customer needs and on the basis of integration, in enriching converged products, strengthening integrated marketing, and promoting converged operations.

In terms of enriching the fusion products, China Mobile will increase cooperation with well-known Internet companies to create a “flow + content + application” integration product to promote rapid traffic growth; and continue to strive to build a one-stop smart home in the family and government market. And smart government and enterprise services to fully meet the diverse application needs of customers.

In strengthening integrated marketing, China Mobile is based on the cross-identity attributes of individuals, families, government and enterprise users, strengthens the integration of basic business, and actively explores the integration and expansion mode of 2H2C and 2B2C families, government enterprises and the public, and develops network age and points. , member and other integrated marketing, actively promote brand reshaping, accurately meet the user's differentiated consumer demand.

In promoting the integration operation, China will speed up the creation of a “mobile cloud” across the network, build a high-speed interconnected private network between cloud resource pools, and realize intelligent connection of cloud networks. Strengthen cloud, network, end and edge collaboration, and launch “cloud+net+DICT” intelligent service to create high-quality, low-latency, end-to-end and differentiated user perception.

Rongtong refers to the use of Rongtong as a carrier to achieve mutual business promotion and increase overall value through capacity sharing, channel interoperability and data convergence.

In terms of capacity sharing, around the smart home, the Internet and the Internet of Things, China Mobile will continue to promote the digital home open platform, unified authentication platform and Internet of Things Open Platform (OneNET) iterative upgrade and integration development.
In terms of channel interoperability, China Mobile actively adapts to the trend of Internet consumption and new retail demand upgrades, and builds a comprehensive and fully accessible channel system to strengthen online and offline collaborative development.
In terms of data convergence, China Mobile will further strengthen the full amount of data remittance, release the value of resources, improve operational capabilities, response speed and service levels.

With the wisdom of the means, we will increase the operational efficiency for the entire process of production and operation, and the whole process. China Mobile is constantly improving its wisdom in China, building smart applications such as artificial intelligence and big data, and improving its support capabilities in the fields of network, market, service, security and management.

Reform and Innovation  
China Mobile is deepening its reform and innovation in an all-round way. With its strong capabilities, cohesiveness and activation, China Mobile is accelerating the construction of a collaborative and efficient organization and operation system.

China Mobile has completed the reform of the organization and operation system of government and enterprises, cloud services, family business and international business. The government and enterprise divisions are established on the basis of the government and enterprise branches, and the cloud competence center is established based on the Suzhou R&D center. Based on the center, the Center will set up a smart home operation center and set up an international business department of the headquarters to accelerate the creation of core capabilities in the cloud service and family business areas, comprehensively enhance the overall planning and expansion capabilities of the government and enterprise market and the international market, and give full play to the headquarters and regional leaders. The synergy of war and professional construction will realize the dynamic combination of “factors” and “capabilities” and create new kinetic energy for the company's revenue growth.