840,000 landlines were closed in China
China’s wireless companies are announcing drops in users as the coronavirus crisis cuts marketing activity, with China Mobile Ltd., the world’s biggest carrier, reporting its first net decline since starting to report monthly data in 2000.
China Mobile subscriptions dropped by more than 8 million over January and February, data on the company’s website showing. China Unicom Hong Kong Ltd. subscribers decreased by 7.8 million in the period, while China Telecom Corp. has said it lost 5.6 million subscribers last month.
The rare industrywide drop in subscribers shows the pandemic disaster that first appeared in China late last year is crimping increase even at businesses that provide essential services and earn monthly income.
Videos on Weibo show bodies piled in public spaces. Also, no explanation for the loss of 21m cell subs this year in China- where normal growth in subs is 8-10% a year and you must have a phone. A small # of drops may be 2nd lines for migrant workers. https://t.co/QWKlakyJnM
— Steven Winkelman (@StevenWinkelman) March 24, 2020
Part of the drop could be caused by migrant workers — who often have one subscription for where they work and another for their home region — canceling their work-region account after the virus restricted them from returning to work after the Lunar New Year holidays that began in late January, said Chris Lane, an analyst at Sanford C. Bernstein & Co.
China Mobile shares dropped 2.7% in Hong Kong trading Monday, compared with a 4.9% slump for the benchmark Hang Seng Index. China Telecom slid 6.3%, while China Unicom declined by 6.4%.
However, drop-in users are unusual, the total is small relative to total wireless subscriptions which have grown to a combined 1.6 billion for the three carriers.
Things may change starting this month as work in factories and other businesses in China reopens, Lane said.
Net income fell 9.5% last year at China Mobile, partly on government mandates to cut prices and improve service. The company, which reported earnings last week, told analysts earnings would remain stable this year, sign management was not concerned about the fall in subscribers, Lane said.