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Chunghwa aims to actively tap markets abroad

Chunghwa Telecom Co (中華電信) will actively tap overseas markets, with Taiwanese business people overseas the main target, the chief executive officer of the partially government-controlled company said yesterday.

Chunghwa Telecom chairman Hochen Tan (賀陳旦) made the remarks while briefing the media on the findings of a recent overseas market inspection tour that took him to the US and Sweden.

During his trip to Sweden Hochen attended a Taiwan-Swedish economic cooperation conference and toured TeliaSonera AB -- the dominant telephone company and mobile network operator in Sweden and Finland, which is also active in other countries in Northern and Eastern Europe.

Hochen said he was impressed by TeliaSonera's productivity and competitiveness. The company's work force only outnumbers Chunghwa Telecom's by 10 percent, but its annual turnover reaches US$12 billion, an amount double Chunghwa's annual sales, he said.

Noting that TeliaSonera's revenues primarily come from its overseas operations, Hochen said Taiwan's telecommunications service providers should step up exploration of overseas markets.

As the nation's largest telephone and mobile network operator, Chunghwa Telecom will take the lead in tapping overseas markets, Hochen said, adding that the company would first focus on exploring markets with a large concentration of Taiwanese business people.

Given the fact that telecommunication service subscribers on both sides of the Taiwan Strait have similar consumer culture and habits, Hochen said Chunghwa Telecom intends to cooperate with smaller-sized Chinese telecommunications operators or added value service providers to tap the flourishing Chinese market.

As the government still imposes many restrictions on investing in China, Hochen said that Chunghwa Telecom will consult with the Mainland Affairs Council (MAC) -- the nation's top China policy planning agency -- and other relevant government institutions before launching its overseas expansion drive.

Chunghwa Telecom would follow legal procedures in tapping the Chinese market, Hochen said.

The Financial Times newspaper quoted Hochen as saying in an April report that the company planned to team up with China Telecom (中國電信) and China Netcom Corp (中國網通) once they obtained third-generation (3G) mobile phone licenses.

The company expects Chinese-language data content to be the engine of future growth, the report said.

Currently, Chunghwa Telecom has 1.03 million 3G subscribers and 7.5 million 2G users in Taiwan. It expects 3G subscriber numbers to rise to 2.2 million by the end of this year from 850,000 last year.

Hochen also said Vietnam would be another Chunghwa Telecom priority target, adding that the country has enjoyed robust economic growth in recent years and that many Taiwanese companies have set up footholds there.

As Vietnam's telecommunication infrastructure and management are relatively backward, Hochen said Chunghwa Telecom stands a good chance of tapping into the market and that the company will focus on investing in telecommunication infrastructure construction in Vietnam's large industrial zones.

The company also plans to invest in telecom operators in other Asian countries such as Thailand, Cambodia and Indonesia, financial executive Joseph Shieh (謝劍平) said yesterday.

In response to Chunghwa Telecom's plans to actively explore overseas markets, especially China, a senior MAC official said that it was mulling over calls for local telecommunication service providers to invest in the booming Chinese market.

But the MAC is still evaluating the feasibility of such a measure, he said.

Under current regulations, telecommunication service providers are banned from investing in China. Local operators have filed petitions to the MAC, the Ministry of Economic Affairs and other relevant government agencies in the hope of an early lifting of the ban.
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