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Guangdong Mobile has decided to cut charges for its Shenzhouxing prepaid service on a trial basis.

From Thursday until July 4, local calls will cost 0.39 yuan (4.7 US cents) per minute, a cut of 35 per cent compared with the usual 0.6 yuan (7.2 US cents).

The cost of a domestic long-distance call has plunged to 0.39 yuan compared with the usual 1.3 yuan (15.7 US cents) per minute, a discount of 70 per cent for people who first dial 12593 on their mobile.

Discounts of 50 to 65 per cent will apply to roaming and Internet protocol services.

Analysts said it seemed "impossible" that Guangdong Mobile would return to its original charge levels for the Shenzhouxing service after the trial period.

They predicted that consumers would probably enjoy further cost reductions after July 4.

Shenzhouxing has been targeted as "the most expensive" service per minute since Little Smart service, which transmits signals through fixed lines and charges lower than regular mobile services, made its Pearl River Delta debut in late April.

A source from Guangzhou Telecom revealed that there were more than 100,000 registered Little Smart users in the city as of the end of May, just one month after the service got approval to operate in Guangzhou.

Around 5,000 new customers have been signing up for Little Smart every day in Guangzhou.

Afraid of losing many of its 15 million Shenzhouxing users, Guangdong Mobile cut into its profit margins to compete with Little Smart's offer of free calls before June 20 and Guangdong Unicom's policy of charging 188 yuan (US$22.70) per month for 1,200 minutes of local calls.

Shenzhouxing users are low-end customers such as college students, employees on temporary contracts and people who use their mobile relatively infrequently, according to Guangdong Mobile.

The firm decided to cut its charge at the beginning of this month to encourage these users to stay with it.

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