China, home to the world’s largest population, was hit by the coronavirus pandemic first and hard, and has been struggling ever since to stay on its feet. While it was speculated that essential industries would still be operating at full force, that does not seem to be case for telecom companies in the mainland. Chinese telecom companies, according to official numbers, reported a drop of 21 million customers as the pandemic brought the $10 trillion economy to a complete halt.
According to an announcement by China’s Ministry of Industry and Information Technology (MIIT) the number of cellphone users decreased from 1.600957 billion to 1.579927 billion between March 19, 2020 and December 18, 2019, a drop of 21.03 million. The number of landline users decreased from 190.83 million to 189.99 million, taking a drop of 840,000, during the same time period.
The situation has become so dire that China Mobile Ltd., the world’s largest carrier, has reported its first net decline since starting to report monthly data in 2000, having lost about 8 million users over the course of January and February (according to the company’s website). Other operators, including China Unicom Hong Kong Ltd. and China Telecom Corp reported similar trends, as both companies lost around 7.8 million and 5.6 million users during the same time period, respectively.
China Mobile shares fell 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 6.4%.
However, during the same time, wireless subscriptions have risen to a combined 1.6 billion for the three carriers as more and more people are staying at home
Industry analysts are putting the reason for this slowdown on travel bans. And that, despite people using their mobiles and internet connections more than ever before. The travel ban, as has been imposed by companies globally, could have led frequent travelers, who usually carry more than a single connection, to forego some of these connections that operate in the places they travel to, thus causing this decline.
Migrant workers too could be a reason for such sudden drop, since none have been able to return to work since the January lock down.