China Telecom's (CHA) Shanghai branch announced that from December 31, 2007, the calling fee for fixed phones between Shanghai's downtown area and Chongming Island will be canceled.

This has made Shanghai the second city in China after Beijing to cancel the district-to-district calling fee for fixed phones.

Since 2001, Shanghai has been adopting a different system for its local fixed phone service and dividing the local fixed phone service into that of a downtown area and Chongming Island area. Any calls made through fixed phones between the two areas have been charged a district-to-district calling fee.

After the fee is canceled, consumers' expenditures on fixed phone communications will be greatly reduced. It is estimated by China Telecom that the cancellation of the fee will help telephone users save up to RMB30 million each year.

At present, China Telecom is busy adjusting the charging equipment and transforming the financial system of the city in order to ensure that the cancellation work will be done smoothly on December 31.