Vodafone adds low-cost cellular radio service

VODAFONE has announced a low-cost cellular radio service for those who make no more than a call a day.

The company said it could save existing mobile telephone users pounds 80 a year but that the idea is also to attract new, non-business customers.

Users of the LowCall system pay a monthly rental of pounds 15 instead of the current pounds 25. But call charges are higher, at up to 54p a minute peak rate in London or 46p nationally, compared with 33p and 25p on the normal system.

Vodafone believes that 20 per cent of its customers will migrate to the new system. The company estimates that it could shave pounds 5m off the company's profits this year and up to pounds 12m next year, with the increase in new subscribers more than offsetting any losses in later years.

The move follows the launch of a similar offering, called Liberty, by Cellnet, Vodafone's rival. Although the services are slightly different in detail, they are based on the same low-rental principle and offer the same financial benefits to potential customers.

However Vodafone believes that mass-market cellular telephones will not take off until new digital services are launched in 1993/94. The company is planning a 'microcellular' system to compete with personal communications networks from Mercury and US West.