Fri, Apr 20, 2007 - Page 12 News List

Chunghwa Telecom to stream live and historic US baseball

PROFITS SQUEEZE The new services come as telecom carriers could suffer an earnings decline due to tariff reductions of as much as 5.35 percent


Taiwan's top telecom operator Chunghwa Telecom Co (中華電信) yesterday said it would offer subscribers free online streaming videos -- including live US Major League Baseball games featuring Wang Chien-ming (王建民) and other Taiwanese players -- in a bid to boost revenues and its subscriber numbers.

Chunghwa Telecom said it would broadcast the New York Yankees' star pitcher Wang's first game live on its broadband and mobile networks next Wednesday.

The company has obtained the rights to broadcast 100 US baseball games live on handsets, TVs and via the Internet this year, in addition to 100 historical games, including Wang's 19 wins last year.

"Chunghwa Telecom hopes to boost the numbers of its mobile and Internet TV users by providing free streaming videos and to encourage users to subscribe for higher bandwidth," said Sally Chen (陳怡君), chief executive of digital content aggregator Elta Technology Co (愛爾達科技), 21 percent owned by Chunghwa.

Chunghwa aims to expand its ADSL user base to 3.4 million by the end of the year, up 6.3 percent from the current 3.2 million subscribers.

The company would also generate more revenues from online advertisements by providing popular digital content, Chen said.

The online advertising market is worth approximately NT$420 million (US$12.7 million) a year in Taiwan, Chen said, without saying where she obtained the figures.

Chunghwa is the first local telecom service provider offering online videos -- including sports and soap operas imported from South Korea, Hong Kong and China -- without extra charge.

The new services come amid industry speculation that local telecom carriers could suffer an earnings decline due to tariff reductions ranging from 4.88 percent to 5.35 percent annually following a ruling by the nation's telecom regulator, the National Communications Commission.

"Chunghwa Telecom will be hardest hit, as it faces an [extra] 5.35 percent tariff cut for its dominant ADSL services in 2007," Taiwan Rating Corp (中華信評), a local arm of rating agency Standard and Poors, said yesterday in a report.

Chunghwa forecast that the tariff reduction may cut NT$2 billion from its revenues this year, while the impact on Far EasTone Telecommunications Co (遠傳電信) and Taiwan Mobile Co (台灣大哥大) may amount to NT$350 million and NT$300 million, respectively, according to the report.

Tariff cuts that take effect over the next three years, starting this month, would likely dampen earnings for the leading service providers, though only marginally, Taiwan Rating said.

Chunghwa's revenues increased 0.6 percent to NT$184.5 billion last year from a year ago, while net income dropped 5.8 percent annually to NT$44.88 billion.

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