State-run Chunghwa Telecom Co's (
Chunghwa's agreement with three fixed-line operators will apply only to profitless voice services, and the lease will be limited to Taipei, Taichung and Kaohsiung, the company said.
"This partial opening repre-sents only a small advance toward a more liberal telco market because the terms have made it difficult for local fixed-line carriers to rapidly expand market share," said Tony Tsai (蔡東松), an analyst with Taiwan Ratings Corp (中華信評), a local unit of Standard and Poor's Rating Services.
Chunghwa's high levy on local loop-phone connection was one of these, Tsai said.
Local fixed-line phone companies will have to pay NT$3,500 per subscriber plus a NT$200 line rental charged by Chunghwa each month, according to one fixed-line operator who requested anonymity.
The monthly rate for Chung-hwa's fixed-line residential users, however, is NT$75 per month, the operator added.
"I doubt this hefty spending will leave much room for private fixed-line carriers to vie for a bigger share of voice services," Tsai said.
In addition, fixed-line operators, including Taiwan Fixed Network Co (台灣固網), will be able to rent "last mile" connections only upon the request of customers who switch operators.
Without aggressive government intervention, Tsai said it would be difficult to see a breakthrough.
Lu Chia-lin (呂家霖), an analyst with Yuanta Core Pacific Securities (元大京華證券), was more optimistic.
"The fixed-lined phone companies at least have the opportunity to expand their services to residential users. Before this opening up, they could only offer services to corporate users because of concerns over cost," Lu said.
"We're very pessimistic about rapid expansion. It will be a tough battle to boost our fixed-line sign-ups," said Jessica Chou (
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