Hutchison enters phone price war

Competition in the telephone call market is set to hot up with Hutchison Telecommunications' launch yesterday of a service costing 16 per cent less than Hongkong Telecom.

Hutchison, the telecoms arm of Li Ka-shing's Hutchison Whampoa, is the last of the new fixed-line rivals to Hongkong Telecom to begin offering local services. New T & T and New World Telephone are the others.

Hutchison said it believed its 'Network Eight' service could grab up to a quarter of the fixed phone market in the long-term.

Managing director Dennis Lui said business users would be charged $88 a month for a basic line, compared with $104.60 charged by Hongkong Telecom.

The service would initially be available in high-density business districts between Sheung Wan and Quarry Bay.

The company hopes to extend the service to residential users by April and plans to undercut Hongkong Telecom's $67 monthly residential line charge, though it will not release prices at the moment.

It hopes to connect 20,000 customers in its first year.

While all the new operators are undercutting Hongkong Telecom, the cheapest deal is offered by New T & T at $83 a month for business users, including call waiting and call answer services free of charge.

New World Telephone charges $88 for a business line.