China Mobile is using its new TD-SCDMA network to offer cut-price fixed-line voice services to residential customers.
The mobile giant, which does not have a wireline business, is undercutting China Telecom and Unicom with its new service in Beijing and Shanghai.
Shanghai Mobile charges a monthly base fee of 16 yuan ($2.34) that includes 50 minutes of local call time, TD fixed-wireless phones use 11-digit phone numbers like mobile numbers with a "188" prefix. For additional use, the carrier charges 0.22 yuan ($0.03) for the first three minutes and 0.11 yuan ($0.02) per minute for extra time. Incoming calls are free of charge.
The phone that looks like a normal wireline phone can be used to send text messages at the cost of 0.10 yuan ($0.01) per message.
Families that sign an 18-month contract and commit to spend at least 88 yuan ($12.88) per month on their wireless phone bills can have the TD fixed-wireless phone free of charge. The phone is not available for sale otherwise.
Beijing Mobile is also selling a TD fixed-wireless phone service, offering 50 minutes of local call time in a monthly base fee of 10 yuan ($1.46) and charges 0.12 yuan ($0.02) per minute for additional use. Subscribers need to pay 20 yuan ($2.93) for the SIM card and can have the first month's base fee waived.
The monthly base fees for both China Telecom's and China Unicom's wireless voice services are higher and do not include any free minutes.
China Telecom, the main fixed-line operator in Shanghai, charges a monthly base fee of 25 yuan while China Unicom charges 21.6 yuan in Beijing. Their standard rate for local calls is 0.22 yuan for the first three minutes and 0.11 yuan for each additional minute.
China Mobile’s TD-SCDMA network, the country’s first 3G network, has struggled to find customers since formally launching early this year.