Outside operators muscle in on Beijing mobile market

Beijing's mobile phone users are starting to enjoy cheaper tariffs thanks to entrepreneurial moves by telecoms operators from other cities in China. Beijing has long been the most expensive place to own a mobile phone in China, even after recent price adjustments by Beijing Mobile (see China Media Intelligence, Volume 6, Issue 5 (27/5/06)) and followed shortly after by Beijing Unicom.

In recent months, mobile operators from as far afield as Hubei, Zhejiang and Sichuan have started offering mobile packages to Beijing consumers that undercut prices in the capital even when an additional roaming charge is incorporated. For instance, one mobile phone operator in in Zhejiang Province charges jsut Rmb10 for unlimited SMS text messaging to anywhere in the country.

It is unclear at present how the regulatory authorities will react to the phenomenon, given that it is virtually unprecedented in China to see mobile operators from different parts of the country competing directly with one another. However, in this case, the high mobile tariffs in the capital have attracted a lot of outside interest. The most likely outcome of the moves is that the Beijing operators will be forced to cut their tariffs even further to remain competitive.

CMI - 22/8/06