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A PRICE war has broken out between Hong Kong's three licensed operators of the second generation of cordless telephones - the CT2 system.

  The autumn price blitzkrieg mirrors a similar battle encountered in the competitive cellular mobile phone market.

  The battle is shaping up as an attempt by the two smaller operators, Chevalier (Telepoint) and Pacific Telelink, to wrestle market share away from dominant player Hutchison Paging.

   Forecasts for the end of the year envisage Hutchison Paging with about two thirds of the market, with Chevalier and Pacific Telelink fighting it out for the remainder.

   The first shot in the phone war was fired by Chevalier on September 1 when it cut the price of its CT2 telephones and CT2-plus-pager packages by 50 per cent.

   The Double Star CT2-plus-pager package, originally $1,120, is now $561.50, with handsets at $394. This offensive provoked a quick response from the other two players. Hutchison Paging replied on Tuesday by unveiling special price cuts on its Tien Dey Seen network.

  It was previously selling its pagers and CT2 handsets separately, but is now promoting a CT2-plus-pager package at $1,000. Last to enter the arena was Pacific Telelink, which slashed its prices by half on Thursday, with a CT2-plus-pager package starting at $688.

   Pacific Telelink chief executive Mike Pilgrim said: 'This is definitely a price war. I reckon this is the buying season from September to November. By the end of the year we are hoping to get around 32,000 subscribers - a 17 per cent share of the CT2 market.'    Chevalier claims to have increased its share of the CT2 market to 30 per cent, up from 23 per cent last year, with more than 50,000 subscribers.

  Hutchison Paging, however, remains the major CT2 service provider. It was the first to offer the service back in March 1992 and enjoys an exclusive arrangement with Motorola for the supply of handsets.

  Chevalier managing director Neil Montefiore said: 'Our main aim is to make the whole CT2 market grow. We can achieve this by making the entry costs lower. That is why we are reducing handset prices this autumn.'   Handset prices have fallen on average by about 70 per cent since CT2 services first appeared, which is a major reason why subscribers have been growing at a rate of 8,000 to 10,000 a month.

  Figures provided by the Telecommunications Authority show 160,226 subscribers using the CT2 network for the month ending last July.

  CT2 phones are lighter and cheaper than cellular phones but can make only outgoing calls, so are usually used in conjunction with a pager.



Price war breaks out in cordless telephone market