Wed, Nov 24, 2004 - Page 10 News List

Seednet sees promise in Internet phones

By Lisa Wang  /  STAFF REPORTER

Seednet (數位聯合), a leading Internet service provider (ISP) in Taiwan, expects its subscribers to jump by 10 percent next year, helped by fast-growing demand for fresh, lower-priced Internet phone services, a company official said yesterday.

Internet phone services have ignited a new hope for local ISP players including Seednet to take a bigger share of a market long dominated by state-run Chunghwa Telecom Co (中華電信), company president Cherng Chia-jun (程嘉君) said.

"We believe Internet phone services will be a new force driving our growth in the future. Not a single telecom operator in Taiwan has the services we offer at this time," Cherng said.

He made the remarks on the sidelines of the launch of the company's latest Internet phone services, which allows Seednet's users to place calls from their laptops to any regular phone at lower rates, or for free to Seednet users.

Seednet users will pay NT$1.5 per minute, which is half the price charged by fixed-line operator Chunghwa Telecom, for overseas calls from their computers to landline phones in 10 countries, including China, the US and Hong Kong.

As local consumers are quickly learning the benefits of Internet phone calls, Seednet expects its ADSL (asymmetric digital subscriber line) subscribers to increase 20,000 next year, from the current 210,000.

"That is a conservative projection, if you take a look at the fast adoption of making online phone calls by local computer users," Jeffrey Chen (陳振熒), assistant vice president of Seednet, said.

Chen expected Seednet's Internet phone users to increase more than seven-fold next year, to 150,000 subscribers from the current 20,000 users, about a year after the company became Taiwan's first telecom operator to debut the service earlier this year.

Subscribers will be able to call overseas, long distance or cellphones after obtaining a phone number, which will start with "070."

One drawback is that their friends will not be able to access the Internet phone by dialing the number, as the nation's telecom regulator still restricts the use of the special band.

Chunghwa Telecom, Taiwan's biggest phone company -- operating a fixed-line business, ADSL business and mobile services -- is considering expanding its Internet phone services to all of its subscribers next year.

"We're carefully evaluating the right timing and proper rates before expanding Internet phone services beyond our corporate users, because any bold move could hurt our fixed-line income," said Shih Mu-piao (石木標), a spokesman for Chunghwa Telecom.

Francis Hsiao (蕭義展), an analyst with Grand Cathay Securities Co (大華證券), said that Internet phone services will indeed eat into the fixed-line market, but it will not entirely replace traditional phone services.

"It's to do with people's behavior patterns. People are not always sitting in front of a computer, or turning on laptops ... to simply make calls. They call from handsets too," Hsiao said.

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