China Mobile (NYSE: CHL) has achieved a milestone that few in the industry can even dream of. The world's largest mobile telecommunication company added 5.9 million customers in March, taking its total customer base up to a staggering 600 million.

Although that kind of user base should make you sit up and take notice, does it necessarily translate into growing business and growing revenue? And how significant is this number for a big company like China Mobile? It's time to take a look at a few numbers and check it out.

Numbers that matter for business
More customers are obviously a good thing for a business like China Mobile. To put things in perspective, let's look at how much revenue the company has been generating per user on an average. As evident from the table below, the company's total wireless subscribers have increased 27.7% between 2008 and 2010. But if we look at the corresponding average revenue per user from the wireless segment for the same period, it has declined by 12%. And declining ARPU is definitely a concern, for me.

Metric

12 months ended
Dec-31-2008

12 months ended
Dec-31-2009

12 months ended
Dec-31-2010

Total wireless subscribers

457.3 million

522.3 million

584 million
ARPU (Wireless)

$12.78

$11.86

$11.24
Net Income Margin

27.3%

25.5%

24.7%

Source: Company reports. Currency conversion is at date of publication's spot rate.

Numbers that Fools should consider
Net income margin has been declining steadily as evident from the table. This indicates the company has been finding it difficult to convert incremental revenues into income, possibly from having to compete in increasingly price-conscious markets. The difficulty of retaining high revenues and resulting bottom line gains per user is also evident in the company's returns on equity which has declined from 27.7% in 2008 to 22.1% in 2010.

The Foolish bottom line
The telecom industry is massively bullish on China, and China Mobile has the advantage to explore this market to its full potential, which is great. It has more 3G customers than its competitors, which should give it the ability to improve revenues from new technologies and services. However, even as 3G technologies proliferate across the country, rivals China Telecom (NYSE: CHA) and China Unicom (NYSE: CHU) are also building out their own networks. That should assure continued downward pressure on pricing, in spite of additional data offerings that bring in more revenue.

If you're an investor in China Mobile, growth is nice, but growth with added efficiency will be the real trick across the next decade.