08.08.2001
Fixed-line price war begins

• Development: Taiwan Fixed Network (unlisted) and New Century InfoComm Tech (Sparq*, unlisted) began operation yesterday. Sparq* and Eastern Broadband Telecom (EBT, unlisted) offer international calls (IDD) to the US and China at 50% and 60% discounts respectively, to Chunghwa Telecom’s (2412.TT) rates.

• Analysis: The new rates for EBT are valid until end of Aug whereas Sparq*’s rates will continue until end of Oct. A 30%-40% discount will likely remain to attract new users.

• Primasia View: A low pricing strategy may work at the introduction level. However, we believe quality and integrated service will decide private fixed-line winners, most likely Taiwan Fixed Network and Sparq*.