China Mobile (Hong Kong) has warned rivals to refrain from aggressive price cuts as fears grow of a looming acceleration in mainland wireless market competition. Speaking after on Thursday's annual general meeting, China Mobile chairman and chief executive Wang Xiaochu said the dominant carrier would be forced to take action if rival China Unicom moved to undercut its tariffs by more than 30 per cent. 'If our rivals undercut our prices by more than 30 per cent, we will certainly have to introduce corresponding measures or else we will lose our users,' Mr Wang said. The Ministry of Information Industry allows Unicom to undercut China Mobile's tariffs by up to 20 per cent. Unicom is expected to launch an aggressive promotional campaign tomorrow, International Telecom Day, which will directly target China Mobile's packages with an effective discount of about 50 per cent. In a challenge to a China Mobile package in Guangdong offering 300 short messaging service (SMS) messages for 20 yuan (HK$18.74), Unicom will offer users a 30-yuan plan that provides 30 yuan worth of credit plus 300 free SMS messages. Unicom's package will charge users 20 fen per minute on voice calls, against 40 fen by China Mobile. An 80-yuan Unicom plan targeting higher-end users will give subscribers 80 yuan of credit and allow them to receive incoming calls from other mobile phone users free, while charging outgoing calls at 36 fen per minute. The plan targets a 70-yuan China Mobile package that also allows users to enjoy free incoming calls. ABN Amro telecommunications analyst Helen Zhu warned investors that the price war in China's wireless market would only get worse. 'Certainly, promotions have been common in China recently, but rarely as dramatic as the degree we are seeing in this instance. Discounting keeps getting worse and we foresee a bloodbath in the second half,' she said. China Mobile is under pricing pressure not only from Unicom but also from fixed-line carriers China Telecom and China Netcom, which have been aggressively rolling out citywide mobile services known as xiaolingtong. Netcom is planning to launch xiaolingtong? services in central Beijing tomorrow, a further sign of newfound respectability for the once frowned upon service. Meanwhile, Mr Wang said the company's roaming business and subscriber growth in developed cities had been hurt by the Sars outbreak.