Far EasTone Telecommunications Co (遠傳電信), the nation's second-biggest mobile operator, gained shareholder approval yesterday for a 20 percent cut in capital. The company said it had no further capital reduction plan, citing future investments in the Worldwide Interoperability for Microwave Access (WiMAX) network.
Far EasTone on Monday made its bid for a regional WiMAX license, joining 12 local companies in an intensive competition for the six licenses the government will be auctioning this year.
WiMAX, a wireless digital communications system, allows for data transfers at much faster speeds than those reached by existing systems.
"We have no plan for further reductions in capital. We will be investing in the WiMAX network," chairman Douglas Hsu (
Shareholders gave the go-ahead to the proposed 20 percent reduction plan, which would bring Far EasTone's capital down to NT$30.98 billion (US$935.4 million) from NT$38.73 billion. Shareholders also gave their approval for the issuance of common share cash dividends of NT$3.10.
"Building the base stations will be a big investment," Hsu said, without giving a specific figure.
Because of the new system's shorter range, mobile operators will have to build 50 percent more base stations than are needed for third-generation (3G) networks to ensure full coverage, Far EasTone president Jan Nilsson said.
This translates into 10,000 to 15,000 WiMAX base stations, calculations by Chunghwa Telecom Co (中華電信), the nation's biggest telecom company, showed.
Chunghwa Telecom planned to increase its number of 3G base stations from 4,500 this year to 5,300 units next year and 10,000 units in 2009, spokesman Shih Mu-piao (石木標) said.
Nilsson said the WiMAX technology would help fixed-line company New Century Infocomm Tech Co (
Last-mile connection is a reference to the terminal portion of a telephone line that enables users to connect to the network.
Separately, Far EasTone said it planned to offer Internet search, Google Search and the G-mail e-mail service in cooperation with online search giant Google Inc. The two companies were also contemplating offering the Google map service to Far EasTone users.
To extend the partnership, Far EasTone was in talks with Google for its online video service company YouTube, to allow its subscribers to browse and upload videos on their handsets.
Commenting on the telecom operator's expansion into emerging markets, Hsu said the company was looking for potential investment targets, mostly Internet service providers in China. No substantial progress has been made on that plan, he said.
Regarding plans to collaborate with Chinese mobile operators on 3G in the Chinese market, Hsu said that “chances are small.”
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