Thursday saw China Telecom Corp., the nation's largest fixed-line operator, specifying a fall in its net income for the first half by 29% from a year earlier. The reason behind the fall was enormous costs for its new 3G network and for marketing, as well as the loss of 9 million fixed-line subscribers.

For the six months through June, net profit came to 9 billion yuan ($1.32 billion), or 0.11 yuan a share, compared to 12.6 billion yuan, or 0.16 yuan a share, in the year-earlier period.

It should be noted though that the expectations of analysts polled by Dow Jones Newswires were hit by the results, as they had expected a profit of 8.3 billion yuan on average.

The revenue for the period hiked 14% to 103.1 billion yuan from 90.4 billion yuan a year earlier.

Telecom said that the total amount of capital expenditure was 17.03 billion yuan during the half-year, a drop of 9.3% from a year earlier.

China Telecom's Chief Executive Officer Wang Xiaochu said in a statement: "Despite its short-term pressure on the company's profitability, the increase in marketing initiatives for the profitable scale development of our mobile services will significantly enhance future sustainable development and value creation of the company."

The statement said that while cellular subscribers totaled 39.28 million, a rise of 11.37 million, or 10.8%; the company had 199 million fixed-line subscribers - a fall of 8.99 million users, or 4.3% from a year earlier.