Fidelity is dropping the expense of the Spartan S&P 500 Index Fund, for instance, by 0.01 percent to 0.05 percent for its Fidelity Advantage share class. Overall, expenses across eight funds and a variety of share classes will decline by 0.01 to 0.08 percent.

"Much of this [price pressure] has come from the emergence and success of ETFs," explained Johnson, "and what we're seeing here is a suite of tradition index-linked products looking to compete on price by lowering its headline expense ratio."

ETFs, the research analyst points out, still have a number of factors working in their favor–such as increased liquidity in some cases and intra-day trading.

"There's the liquidity advantage in an ETF wrapper vs. that of a fund wrapper, which many investors put a strong value–both those that buy and hold and look at their rebalancing costs and those that trade positions more frequently," he noted.

The Vanguard S&P 500 ETF (VOO) has about $117 billion in assets vs. $48.5 billion in the Fidelity Spartan S&P 500 Index (FUSEX).

Minimum-Investment Shift

For 14 of its Spartan index funds, Fidelity is lowering the investment minimum for Investor Class shares from $10,000 to $2,500, while the minimum of its Advantage Class shares will drop from $100,000 to $10,000. Investment minimums also were lowered across eight other Fidelity funds from $10,000 to $2,500.

"This is a dramatic reduction, from $100,000 to $10,000 in some cases," said Johnson, "but it's still high measured against ETFs."

Over the past few months, many industry players have lowered expense ratios for their ETFs. In November, for instance, Invesco PowerShares decreased the expense ratios of six PowerShares ETF portfolios from 31 to 36 basis points.

BlackRock and Vanguard also have cut costs and adjusted their ETF lineups. And, in September, Charles Schwab cut ETF fees, some by as much as 59 percent.

Fidelity Investments waived trading commissions in 2010 and 2011 on a group of its ETFs. Its index funds have about $100 billion in assets, and its total assets under management is $1.6 trillion.

"We've seen a flurry of these types of announcements, largely in the ETF space," said Johnson. "This is one of the more notable announcements in the tradition fund space to come out recently along these lines."

How it well impact Fidelity, of course, remains to be seen. "But any time expenses come down, it's more money in investors' pockets and less in the fund providers' pockets," the analyst noted.