Chunghwa eyes WiMAX market

Chunghwa Telecom Co (中華電信), the nation's largest telecom operator, is considering investing in Global Mobile Corp (全球一動) to secure part of the market for Worldwide Interoperability for Microwave Access (WiMAX) next-generation telecom service, a company official said yesterday.

"We are assessing [the possibility.] ... If we do, the investment will be minimal, as we see it as a strategy to preempt" the risk of being left out of the WiMAX market, Shih Mu-piao (石木標), a spokesman for Chunghwa Telecom said yesterday.

Shih declined to discuss the details of the potential investment.

Chunghwa Telecom failed to win a regional WiMax license in a July auction to offer the high-speed telecom services.

The company said at the time that it would join the next bid in 2009 for a nationwide license.

Before launching its own WiMAX services, Shih said, Global Mobile's operations could test the waters, as the investment required for launching WiMAX service would be massive and the returns could be limited by technological barriers and competition.

Experience with WiMAX at home could also pave the way for Chunghwa to expand overseas, he said.

Shih's comments came in response to a report in the Chinese-language Economic Daily News yesterday about the company's potential alliance with Global Mobile.

Global Mobile is chaired by Rosemary Ho (何薇玲), a former country manager at Hewlett Packard Co's Taiwan unit.

Global Mobile is faced with a year-end deadline to increase its capital to more than NT$1 billion (US$30.78 million), as requested by the National Communications Commission (NCC).

Six companies have been awarded licenses to build and operate WiMAX networks in Taiwan. Global Mobile, Vmax Telecom Co (威邁思) and First International Telecom Corp (大眾電信) won licenses for northern Taiwan, while Far EasTone Telecommunications Co (遠傳電信), Tatung InfoComm Co (大同電信) and Vastar Cable TV System Corp (威達有線電視) won licenses for the south.

The companies were given 18 months to build WiMax service networks and are required to launch their commercial operation within six months of completing the construction.

Global Mobile had NT$1.14 million in capital when it last published company figures. If it misses the deadline to hit the capital minimum, it could lose its license after a three-month grace period.

Global Mobile was not available for comment yesterday. Earlier this month, Ho said the firm's fund-raising efforts were running smoothly. The telecom company is scheduled to unveil new shareholders by the end of this month.

Meanwhile, Vastar has applied to the NCC for an extension to meet capitalization requirements and First International announced in September a plan to raise NT$3 billion by issuing 250 million common shares via private placement.

Far EasTone, Tatung and Vmax said earlier that they have obtained sufficient capital to guarantee their ability to carry out their WiMAX plans.