By Ron Coates, 6 June 2003 15:52
NEWS Hutchison's '3' today upped the stakes in the struggle to roll out 3G to an unreceptive public by starting a serious voice price war. The company unveiled two new tariffs which the company claims offer savings of up to 50 per cent. Some analysts have put the figure as high as 70 per cent. Analyst John Strand early this week warned that this would not advance the 3G cause and that 3 risked being seen as "just a new discount brand". Strand believes that non-voice traffic should be 40 per cent of revenues. But Ovum analyst John Delaney disagreed. "It's quite sensible for Hutchison. People who say that it will devalue what should be a premium service for the future miss the point," he said. "If 3 doesn't make money they haven't a future. We have been quietly saying for some time that the killer app on 3G is voice." The two new bundles, VideoTalk 500 and VideoTalk 750 offer 500 and 750 minutes on any network at any time for £25 and £35 per month. On top of that, 3 is tossing in £10 and £20 worth of video calls, as well as 25 and 50 text messages free for the first three months. Delaney feels that the price war will be slow to get off the ground. He said: "They [the competition] won't react on price for some time. They will in marketing they'll probably rubbish 3." Since 3's launch in February, it is believed to have won 25,000 users and to be adding 600 a day through Carphone Warehouse. The voice challenge is the first move made by the new management of 3, who were parachuted into the company at the end of last month.
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