Supersized Chinese wireless service provider and Motley Fool Global Gains recommendation China Mobile (NYSE:CHL) released interim results for the first half of 2007 Wednesday, showing that indeed the big can get bigger. The company reported a 25.7% increase in earnings to $5 billion on revenue that grew 21.6% to $22 billion. The company now reports a total base of more than 332 million subscribers.

Growth at the massive wireless carrier continues to come from more rural markets in mainland China. While the company blows away competitor China Unicom (NYSE:CHU) by signing up more than 5 million new users per month, these new customers come at a price. With roughly 50% of the 31.1 million net adds in the first six months coming from rural areas, the revenue earned from each tends to be less, putting pressure on China Mobile's ARPU numbers. Sales of value-added services rose by 35.5% ,  helping offset the decline in voice revenue and keep ARPU steady at $11.62 when compared with the first half of 2006.

With a market that is still far from saturation, China Mobile isn't battling in a cutthroat environment such as the U.S., where AT&T (NYSE:T), Sprint Nextel (NYSE:S), and Verizon Wireless -- a joint venture of Verizon Communications (NYSE:VZ) and Vodafone (NYSE:VOD) -- fight tooth and nail for each subscriber. But this isn't to say signing up subscribers is easy -- China Mobile spends heavily on marketing to more rural areas, where the market is less penetrated. Increased costs as a percentage of revenue contributed to a 3.3% drop in EBITDA margin to 53.9% during the first half.

And rising churn is a concern as China Mobile moves deeper into the market. In the first half of 2007, monthly subscriber churn was 2.72%,  compared with 2.54% in the same period last year. While 20 basis points doesn't sound like much, when applied to a massive subscriber base of more than 330 million, every point counts. This churn level on a largely prepaid base is still within an acceptable range, though, when compared with other carriers around the world.

Overall, China Mobile is developing quite well, considering the massive operation it manages. And the exceptional growth in value-added services shows that this giant still has room to grow.

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Fool contributor Dave Mock has a hard time imagining all the tea in China. He owns no shares of companies mentioned here. Dave is the author of The Qualcomm Equation. Vodafone is an Inside Value recommendation. The Fool's disclosure policy won't take sides in any spat between spouses, even when it's obvious who's wrong.