Thu, Aug 16, 2007 - Page 12 News List

WiMAX winners to cooperate on network coverage

COMPLEMENTARY By joining forces, Vastar Cable and Vmax Telecom would be able to combine their regional licenses to offer users expanded coverage

By Lisa Wang  /  STAFF REPORTER

Two of the winners of the WiMAX license auction last month have joined forces to offer more extensive network coverage starting next summer.

Vmax Telecom Co (威邁思電信) and Vastar Cable TV System Corp (威達有線電視) signed an agreement yesterday to provide worldwide interoperability for microwave access (WiMAX) service nationwide next year.

The deal marked the first strategic alliance between the nation's WiMAX telecom carriers after the auction of six licenses late last month for the winners to offer the service either in the north or in the south.

"We only got a license to provide WiMAX service in the north. It will be difficult [to survive] by providing telecom services just in a specific region. We believe Vastar will complement our service," said James Tsao (曹萬鈞), vice chairman of Vibo Telecom Inc (威寶電信), a local third-generation (3G) service provider.

Vmax is a 50-50 WiMAX joint venture between Vibo and telecom equipment maker Tecom Co (東訊電信).

At last month's auction, Vastar Cable won a license to offer the service in the south.

"We don't want our subscribers to worry about paying higher rates during a 30-minute trip down south," Vmax president Teddy Huang said.

The strategic alliance would allow Vmax to provide convergent telecom services, or triple play, for subscribers as Vastar is a fixed-line and cable TV operator in Taichung, Tsao said.

Vmax plans to launch its WiMAX service next June, two months earlier than its original schedule, chief financial officer Ruth Chang (張虹如) told reporters on the sidelines of the signing ceremony.

With WiMAX's faster data transmission, Vmax hopes to lure ADSL users and sign up 80,000 subscribers by the end of next year, Chang said.

The company aims to break even by the first half of 2010, Chang said.

To fund the construction of WiMAX networks, Vmax, which has NT$1 billion in capital, plans to raise NT$1 billion by selling new shares to existing shareholders before the end of this year, Chang said.

It also plans to sell NT$1 billion in new shares to institutional investors such as Intel Capital, Chang said.

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