China Mobile has cut the price of its mobile communications for its trial 3G services close to the rate for fixed-line phone under new packages that it will introduce in three cities first as it bids to woo enterprise, family and campus users.

China Mobile will launch the new packages, which will cut rates by more than 50 percent, within a year from this month, China Mobile said in a statement published on the Website of the Ministry of Industry and Information Technology yesterday.

It has chosen Guangzhou, Shenzhen and Tianjin as the first batch of cities to offer the new packages, said the world's No. 1 telco by subscribers. The new packages will be available in seven other cities, including Beijing and Shanghai, that have TD-SCDMA (time division-synchronous code division multiple access), or 3G, networks.

Under the new enterprise package, China Mobile offers users 500 minutes of calls costing 30 yuan (US$4.41), compared with 88 yuan for 600 minutes previously.

The TD-SCDMA call rate is 0.22 yuan for the first three minutes and 0.11 yuan for the following minute, lower than China Mobile's 2G (second generation) rate and similar to China Telecom's fixed-phone rate.

To attract campus users, China Mobile offers a 25-yuan package including 150 short messages, 100 megabytes of data traffic and free incoming call display.

"It's (rate cut) good news but the key problem is the limited variety of handsets," said Sandy Shen, a Shanghai-based analyst at Gartner Inc, a United States-based IT research firm.

China Mobile started the trial TD-SCDMA services in 10 cities in April but it attracted only limited number of users because of the lack of a wide choice of TD-SCDMA phone models.

"The carrier with the most 3G models will win the battle in the next-generation mobile war. Now WCDMA, and even CDMA2000, are way ahead of TD-SCDMA," said Shen.

After the national telecommunications industry revamp, the new China Unicom is expected to operate WCDMA (wideband-CDMA) and China Telecom, which acquired China Unicom's CDMA business, will evolve to CDMA2000, industry insiders said.

The WCDMA and CDMA2000, the two global 3G systems, are now widely used in overseas markets but TD-SCDMA is a relatively newcomer that is not used internationally.

(Shanghai Daily September 10, 2008)