The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.NEW YORK ( Trefis) -- China's second largest wireless service provider, China Unicom ( CHU), said last week that it added 3.23 million subscribers in January that took its total tally past the 200 million mark. The company now has about 203 million mobile subscribers, up 1.62% from the prior month. The debut of Apple's ( AAPL) iPhone 4S in China helped China Unicom add more than 3 million 3G subscribers, which accounted for almost 95% of the total net additions. China Mobile ( CHL) and China Telecom ( CHA) also released their monthly subscriber adds. Both reported a growing number of 3G subscriber additions, though they fell well short of China Unicom's net 3G adds.
It hence bodes well that China Unicom is not banking on the iPhone alone to boost its 3G subscription numbers. It recently came up with a
strategy to sell low-cost smartphones provided by ZTE, Huawei and Lenovo that run on its 3G network. By selling cheaper smartphones, the carrier will not have to worry about paying higher subsidies associated with the high-priced smartphones such as the iPhone. At the same time, it stands to benefit from higher data usage associated with 3G smartphones. China Unicom's EBITDA margin for its mobile division has declined sharply in recent years, from 42% in 2008 to about 24% expected by the end of 2011, mainly due to high level of subsidies associated with the high-priced smartphones. But its ARPU levels have increased sharply since 2009 when it started selling the iPhone. Click here to find out how a company's products impact its stock price at Trefis. Like our charts? Embed them in your own posts using the Trefis Wordpress Plugin.