North Korean 3G Customers More Than Double in Q2

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The number of cellular subscriptions in North Korea more than doubled in the second quarter of this year although average revenue per user (ARPU) fell, Orascom Telecom said.

Koryolink, in which Orascom owns a majority stake, had 47,863 subscribers at the end of June. That's more than twice as many as at the end of April, when the total stood at 19,208, said Orascom. The Egyptian company owns cellular networks in several developing markets, including a 75 percent stake in Koryolink. The remainder is held by the state-run Korea Posts and Telecommunications Corp.

The network is North Korea's only cellular network open to individual subscribers. It uses 3G WCDMA (Wideband Code Division Multiple Access) technology, and began service on Dec. 15.

During the second quarter the average revenue per user (ARPU) was US$22.80, down from $24.70 in the first quarter. Koryolink ran several offers during the quarter that hit revenue, including free SMS text messaging and lower connection rates.

Earnings during the quarter were $2.5 million before accounting for interest payments, taxes, depreciation and amortization. Orascom did not disclose whether the network made a net profit or a loss for the period. Currency conversions were done at the official exchange rate, which can be significantly different from street rates.

During the third quarter the carrier plans to expand sales through offices operated by KPTC. Its retail network includes two shops and an additional three KPTC offices where subscribers can buy air-time scratch cards. It plans to add a further six KPTC locations during the quarter.

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