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Telecom Providers Launch Competitive Plans
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Two major Chinese fixed-line operators are using the festive season to launch competitive long distance call plans.


China Telecom, the country's largest fixed-line operator, will run a special long-distance deal from December 10 to May 10.


On weekends, official holidays and from 8pm to 8am on weekdays, users can pay 1.99 yuan (25 US cents) for domestic long distance calls if the conversation lasts between six and 45 minutes, by dialing 11808.


International calls to 10 countries, including the United States, France and Germany, cost 2.99 yuan (38 US cents), if the conversation lasts for less than 10 minutes. The usual tariff for the Internet protocol (IP) call is 2.4 yuan (30 US cents) per minute to the United States and 3.6 yuan (46 US cents) per minute to France.


The tariff for calls to Taiwan Province, Hong Kong and Macau is 1.99 yuan (25 US cents) for calls less than 10 minutes.


China Netcom, a minor competitor against China Telecom, which is dominant in China's 10 northern provinces, also registered with the Ministry of Information Industry to launch a similar promotional plan. However, the Beijing-based China Netcom has yet to decide the plan's launch date.


The discount is only applicable for domestic long distance calls on weekends, New Year's Day, the Chinese lunar New Year - which falls on February 18 in 2007, the Labour Day holiday from May 1 to 7 and the National Day holiday from October 1 to 7.


Yi Mingyu, a senior telecom analyst with Hong Kong-listed mainland research house CCID Consulting Co Ltd, said that the period from December to February is usually the greeting season. During this time, the number of domestic long distance calls is much higher than other months.


But the major impetus for the launch of China Telecom's and China Netcom's aggressive promotions is competition from mobile operators China Mobile and China Unicom, as well as the smaller fixed-line operator China Railcom.


Since China Telecom and China Netcom dominate nearly all of the local call market, the long-distance call becomes the only lucrative market for these two firms and their three rivals.


Some operators in Beijing sell long distance calls for 30 percent of the face value, so many users buy those cards rather than using China Netcom's Internet protocol (IP) call service, which rarely offers any discount.


"The customer is the most important asset for telecom operators, so if China Telecom and China Netcom can't get their users hooked on their networks, it's a problem for them," Yi said.


(China Daily December 28, 2006)


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