Shanghai Telecom said yesterday it will start offering more flexible fee packages for fixed-line phone users, including prepaid card services, in an attempt to win back market share the company is losing to mobile phone service providers.

The new packages will allow users to replace monthly line rental fees with cheaper daily fees, and the cost of making a local call will be lower during non-peak hours, the company said yesterday.

Shanghai Telecom currently has 7 million subscribers.

At present, fixed-line phone users pay 25 yuan (US$3.09) a month to telecom operators even they don't make any calls. Besides the monthly fee, consumers pay 0.20 yuan for the first three minutes and 0.10 yuan for each additional minute for local calls.

The National Development and Reform Commission and the Ministry of Information Industry announced last week that China Telecom and China Netcom, and their subsidiaries, can start to issue their own fee policies for the first time, in order to give consumers a choice from various fee packages.

"We have got a notice from our national headquarters and we are designing detailed fee policies now," Zheng Jianping, Shanghai Telecom's spokesman said yesterday in a phone interview. He wouldn't give any specifics on the new fees, but said they would be announced in the near future.

Fixed-line phone operators say the new fee packages will help them compete better with mobile service providers, such as Shanghai Mobile and Shanghai Unicom.

Recently, Shanghai Mobile reduced its fees for local calls to 0.15 yuan for one minute, close to the fee level for fixed-line phones. Shanghai Unicom said it would provide packages with "more competitive prices" soon. Now many people choose to use their handsets rather than fixed-line phones even when they are at home," said Evan Zhang, 26.

"If Shanghai Telecom's new packages are attractive enough, I will consider using the phone in my home." Zhang added.

(eastday.com August 9, 2005)