Low Take Up Of 3G

3 Italia, the Italian mobile phone start-up controlled by Hong Kong giant Hutchison Whampoa, does not plan to match a move by its British sister company and launch a fierce price war.

"We have no plans to change our tariffs," said a spokesman for the Italian operator, adding that the Italian business was offering customers handset discounts instead.

3 UK launched a price assault on Monday, undercutting its established rivals by 30 to 50% for voice calls with two aggressively-priced new packages that some analysts called a last-ditch attempt to boost flagging sales of high-tech phones.

3 UK and 3 Italia spearheaded live video phone calls by launching Europe's first, third-generation services in March. But software glitches, high prices and a poor battery life marred sales, which stand at some 25,000 in the UK and 100,000 in Italy — far short of European year-end targets of two million.

The move by 3 UK to aggressively slash voice tariffs shook shares in established rivals mmO2 and Orange amid market concerns that the European mobile phone market was heading for a damaging price war that would weigh on margins.

However, 3 Italia is instead offering a 250 euro ($293) discount on its 3G handsets for clients trading in standard, second-generation phones. The discount cuts the price of one of the best-selling phones, made by Japanese manufacturer NEC, to 495 euros, the spokesman said.

"It has been very popular," he said, adding Italian consumers were often quick to spend money on upgrading their handsets when new models come on to the market.

3 Italia and 3 UK have seven sister companies in Austria, Denmark, Ireland, Sweden, Australia, Hong Kong and Israel, although the UK and Italian arms were the first to launch 3G.

Established cellphone groups such as market leader Vodafone Group, Deutsche Telekom's T-Mobile and Orange say 3G services such as video calls and high-speed online services are not ready for commercial use.

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The joint venture envisages Aftek Infosys bringing in 49% of the equity and the rest being contributed by Mr. Niran Talgeri, the Chief Technology Officer of 3 - the UK based 3G Product and Services Company formerly known as Hutchison 3G, UK.

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3 Italia, the Italian mobile phone start-up controlled by Hong Kong giant Hutchison Whampoa, does not plan to match a move by its British sister company and launch a fierce price war.

The latest findings from TNS reveal that Asia is ready to adopt next generation wireless services and pay extra for them, supporting its role as one of the world’s most sophisticated mobile markets.