01.29.2001
Chunghwa Telecom (2412)'s fixed-line monopoly faces competition

• In order to deregulate the state-run telecommunication sector and open it up for competition (and also meet WTO entry requirements), in Jan. 1996 the Taiwan legislature approved opening up the Taiwan telecommunication sector within 5 years to domestic and foreign competition. In addition, three fixed-line wireless communication licenses were also approved.

• Eastern Broadband Telecom Co. (capitalization NT$65.6b/US$2.1b) will be the first licensee to start operation. The company will see a Feb. 2001 opening after completing the installation of communication equipment for 150,000 subscribers, initially by providing broadband to business clients. By Dec. 2001, Eastern Broadband will complete an island wide fiber-optic network in co-operation with state-run Taiwan Rail Administration. The network will raise capacity by a further 1.8m subscribers.

• Taiwan Fixed Network Telecom and New Century Infocommon Co. will follow within the next two months as next two companies to receive operating licenses. These three newcomers are expected to generate NT$10b of revenue in the first year, with each having between 150,000 to 200,000 subscribers (for a total of 600,000). This will be around five percent of the number of Chunghwa Telecom's customers.

LokChong@Primasia.com +886-[0]2-2547-8881