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Telecom costs down 13.6% - official
Latest Updated at 2008-January-4 09:43:02
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Chinese phone users are now less reluctant to check their phone bills as efforts to reform the monopoly industry resulted in a 13.6 percent drop in 2007 in overall telecommunication charges in China.

It means the cost have reduced by half in the past five years, said Information Industry Minister Wang Xudong at a work conference here on Wednesday. He added that "a preliminary market-oriented pricing system has been established."

He did not mention the specific amount or how the cost was calculated. A spokesman for the ministry was not available for comment.

As more Chinese accused the telecommunication industry, dominated by several state-owned giants, for reaping handsome profits by charging monopolistic prices, the government urged the companies to offer lower pricing packages.

China Mobile started to offer charge packages that offer free incoming calls in February, a major change promoted by the Ministry of Information Industry early in 2007. Similar packages were also adopted by rival China Unicom. Chinese mobile operators used to charge both the caller and the receiver.

Price cuts did not bring down the mobile operator profits because the 539 million Chinese mobile users were encouraged to make more phone calls. China Mobile registered 37.9 billion yuan net profits ($5.19 billion), up 25.7 percent in the first half.

But the fixed line operators reported profit losses as mobile operators won more customers with cheaper prices. The rapid proliferation of mobile phones in China has made the traditional fixed-line less attractive. While 39.9 percent of the population have a mobile phone, only 28.3 percent have fixed-lines.

The telecom business volume reached 1,680.86 billion yuan, up 27 percent in the first 11 months last year, and the business revenue amounted to 663.92 billion yuan, up 10.9 percent.

Editor: Yan

By: Source:

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