Wed, Nov 08, 2006 - Page 12 News List

Chunghwa Telecom negotiating for a stake in Softbank

TV AND FILM Chunghwa Telecom said it hoped to introduce the Japanese firm's digital content to its mobile phone, IPTV and broadband subscribers

By Lisa Wang  /  STAFF REPORTER

Chunghwa Telecom Co (中華電信), the nation's biggest telecom operator, yesterday said that it was in talks with Softbank Corp to purchase a stake in the Japanese Internet and telecom group's local unit in order to expand its digital content services.

Chunghwa Telecom hopes to introduce Softbank's digital content such as TV programs and films to its mobile phone, broadband and Internet-protocol TV (IPTV) subscribers.

"We are interested in cooperat-ing with Softbank," Chunghwa Telecom chairman Hochen Tan (賀陳旦) told reporters on the sidelines of a press conference for the annual Global Business Dialogue on e-commerce starting today in Taipei.

"Softbank owns content that is different from that made by Taiwanese companies, and that's exactly what we would like to offer our users," Hochen added.

Hochen declined to confirm that Chunghwa Telecom aims to obtain a 30 percent stake in Softbank's local affiliate by buying new shares from the Tokyo-based company before the end of the year.

"The progress fell short of their expectation ... We are still making an effort [to get a stake,]" Hochen said. "We hope to expand our content through the investment."

Softbank in February invested NT$56 million (US$1.71 million) to set up a local unit, which is fully owned by the Japanese firm, to provide digital content, according to information provided by the Ministry of Economic Affairs.

Vibo Telecom Inc (威寶電信), the nation's latest third-generation (3G) telecom service provider, had also said that it hoped to form a strategic alliance with Softbank by purchasing a 20 percent share of its Taiwanese unit.

Hampered by its limited program offerings, Chunghwa Telecom trimmed its IPTV subscriber target for this year twice to 250,000 users, half of its original estimate of 500,000. The IPTV business is still in the red.

Chunghwa Telecom also said yesterday that it planned to offer paid subscription services allowing handset users to download films, music and animations starting next year.

Chunghwa Telecom added that it was in intensive talks with Korean and Chinese telecom operators, including state-owned China Telecom (中國電信) and China Netcom Corp (中國網通), to offer users more services and download more content.

"We hope mobile phones will become another tool for consumers to make online shopping transactions," Hochen said.

Chunghwa Telecom has 7.8 million mobile subscribers as of August, accounting for 40 percent of the nation's mobile phone market.

Shares of Chunghwa Telecom were unchanged at NT$57.7 yesterday, underperforming the benchmark TAIEX which rose 0.9 percent.

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