Always be selling

Unicom's CEO: Chang Xiaobing

Zhou Hua, an employee at China Unicom believes that he has the world’s most stressful job: “When I open my eyes every morning, I feel like I owe the company a lot of money.”

Zhou (not his real name) is one of the 48,162 employees at the telecom operator now tasked with marketing its new 3G service in addition to their normal day jobs.

Although Zhou is actually a technician based in the telecom operator’s Beijing branch, he now also has a responsibility to promote China Unicom’s 3G wireless service, says National Business Daily. “According to our company’s requirement,” says Zhou, “I have to sign up six 3G subscribers every quarter. It is said that in the near future, all employees will have to sign up more than 10 per quarter.”

In January, the Chinese government finally issued the much-anticipated 3G licenses to the country’s three telecom operators.

China Mobile, the country’s market leader in mobile telephony, was given the license to exploit the homegrown technology TD-SCDMA, while China Unicom and China Telecom were given licenses for W-CDMA and CDMA2000 respectively (see WiC3). Although still in its infancy, the competition to sign up new 3G subscribers is already fierce.

China Unicom trails China Mobile, the world’s largest mobile carrier, in the 2G business and has little hope of catching up. However, with the release of 3G licences the playing field looks more level and Unicom – with 130 million customers and 21.7% of the 2G market in 2008 – hopes for at least a 30% 3G share.  And this is where Zhou and an army of employees like him are being asked to help out.

The National Business Daily says China Unicom is not the only firm to push its employees into the role of reluctant salesmen. China Telecom has admitted to having implemented a similar marketing campaign. Meanwhile, an employee at China Mobile told the paper that as a part of an employee’s key performance index (KPI), every employee needs to convert a certain number of 2G subscribers to 3G.  Failure could lead to a poor evaluation and a reduced bonus.

To meet their quarterly quotas, Zhou and his colleagues are convincing friends and relatives to convert to the 3G wireless service. The less resourceful are even signing up for new accounts themselves, using fake names. Zhou confesses to be amongst this hapless group.

A batch of overextended employees is the least of Unicom’s problems, however. Some analysts believe it is lagging behind its rivals in the implementation of its 3G service. China Telecom has already completed its own 3G upgrade in first-tier cities. Meanwhile, China Mobile has rolled out services in over 10 major cities, including Beijing, Shanghai, and Guangzhou. It is confident that its TD-SCDMA network will cover 238 large and medium-sized Chinese cities by the end of the year.

Chang Xiaobing, chairman of China Unicom, recently reiterated his company’s ambitions for 3G. He plans to spend Rmb60 billion ($8.76 billion) on a nationwide W-CDMA network, with services extended to 284 cities.

Perhaps China Unicom is starting to understand that pushing its employees to promote its 3G service can only go so far. Another approach has been to lure new subscribers with the offer of cool 3G gadgets. Hence Unicom has signed with Apple to distribute the popular iPhone exclusively in China. It also plans to release over 45 different models of 3G phones, including foreign and domestic brands, such as Samsung, Sony, Ericsson, Huawei, and Nokia.

The impact of all these measures is still far from apparent. But until the battle for market share starts to become more clear, Zhou and many of his colleagues will probably be having a few more sleepless nights, wondering how best to hit their sales quotas.

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