China Mobile Ltd posted a profit rise of almost 30 percent year on year for the first nine month due to a growing new subscriber base, especially in rural areas across China, the world's No. 1 wireless carrier by user base said yesterday.

China Mobile Ltd's net profit was 59.9 billion yuan (US$7.9 billion) from 46.1 billion yuan a year earlier. Revenue climbed 22 percent year-on-year to 258.5 billion yuan, the Beijing-based firm said in a statement.

In the three months ended on September 30, China Mobile, which controls two-thirds of China's handset market, generated a net profit of 21.97 billion yuan, or 38-percent growth year-on-year. It beat UBS's forecast of 21.20 billion yuan.

"China Mobile's results continued to develop rapidly after we took advantage of economies of scale and enhanced management," the company said in the statement.

China Mobile has cut rates and penetrated into rural markets to add entry-level users.

Meanwhile, China's mobile carriers will probably launch a free incoming call policy next year, which strengthens pressure on fixed-line phone operators such as China Telecom and China Netcom.

China Telecom Corp, the nation's biggest fixed-line telephone carrier, said profit rose 1.8 percent to 17.3 billion yuan in the first nine months.

China, the world's largest telecom market, is increasingly turning to mobile phones over fixed-line telephones, a fact that is likely to be reflected in more modest earnings for fixed-line operators, industry insiders said.

China now has 515.66 million handset users.

Meanwhile, the fixed-line phone user base fell 320,000 to 372.45 million last month, according to the Ministry of Information Industry.

China Mobile added a record high 6.1 million new subscribers in September compared with 5.58 million in August, according to the company.

China Mobile's ARPU (average revenue per user per month), a key measure in the industry, increased one yuan to 89 yuan in the third quarter. It means the company becomes more profitable when it attracts new users.

Shares in China Mobile rose nearly 52 percent in the third quarter compared with a 25-percent gain in Hong Kong's benchmark Hang Seng Index.

(Shanghai Daily October 23, 2007)