China's 460 million cellphone users can expect to see their bills shrink, with regulators and major operators in talks to scale back telecommunication fees.

The new fee policies will make incoming calls free and reduce costs for inter-province calls and for retaining a suspended number, said the Ministry of Information Industry (MII) and the National Development and Reform Commission (NCRC) on Saturday.

Cellphone users in China currently have to subscribe to "fee packages" and pay in advance for free incoming calls.

Inter-province calls will be evaluated and the new fees published in December, and the 20-yuan (US$2.6) charge paid by users each month to retain a suspended number will also be cut, according to the two ministries.

Analysts say that China Mobile's dominance in the cellphone market has made it difficult to reduce fees.

China Mobile is the leading telecoms company in China with a 44-percent market share and that share is growing. 66 percent of new subscribers chose China Mobile in 2006, and that figure rose to 78 percent to 80 percent in the first quarter of this year.

Lower charges for cellphone users highlight the need for deeper reforms in the telecoms sector, said He Xia, an MII senior engineer.

Operators must find ways to lower costs via technological innovations to cope with lower revenues from phone users, said He, and fixed-line operators -- for whom lower cellphone charges are a genuine threat -- should be entitled to 3G licenses to ensure that the market remains balanced.

(Xinhua News Agency April 30, 2007)