China's dominant telco posts dip in profits

China Telecom, China's biggest phone company, said its first-half earnings fell amid slow growth in its fixed-line service, though revenues rose on strong performance by its newer Internet businesses, according to an Associated Press report.

The report said net earnings were 14.1 billion yuan ($1.8 billion), down 4.2% from the same period last year, according to the Beijing-based company. It said total revenues rose 3.5% to 86.9 billion yuan ($10.9 billion).

The total number of fixed-line subscribers rose by 4% to 219 million, with local phone revenues falling 2.5% to 39.8 billion yuan ($5 billion), the company said.

At the same time, the number of broadband customers soared 20% to 25.3 million, pushing up broadband revenues 34.7% to 10.8 billion yuan ($1.4 billion), it said.

The results reflected efforts by China's phone companies to promote broadband access, Internet-based cable TV and other new services to drive growth as potential voice customers opted for mobile carriers. China has the world's biggest telecom market, with 798 million phone users, including 431 million mobile phone customers as of the end of July, according to the government.