Local mobile service provider Vibo Telecom Inc (威寶電信) yesterday said it significantly reduced losses last year and was aiming to at least double average revenue per user by the end of this year in an attempt to reach its new turnaround goal next year.
Last year, the company’s losses fell to NT$1.76 billion (US$61 million), compared with losses of NT$4.25 billion in 2009. Revenue expanded 5.75 percent, from NT$7.3 billion one year ago to NT$7.72 billion.
“We believe this is a target Vibo can reach and then go on to make a profit next year as it involves a lot of reorganization and network upgrading,” Vibo chairman Rock Hsu (許勝雄) told shareholders during the annual general meeting.
To catch up with the nation’s big three in mobile phone service providers technologically, Vibo has budgeted NT$3 billion to update its core network to 3.75G toward the end of this year, chief executive George Chou (周鐘麒) told reporters.
That would help Vibo to grow the contribution of data revenue to 20 percent of overall revenue by the end of the year, from up to 17 percent now, Chou said.
Limited by slower 3G Internet access and insufficient bandwidth, Vibo has lagged behind its competitors in providing data services to boost business as voice revenues stagnates.
Chou, a telecoms veteran, used to be in charge of the fixed-line business for the nation’s second-largest phone company Taiwan Mobile Co (台灣大哥大) before he jumped ship in March. He is now in charge of devising a new strategy to turn Vibo around after years in the red.
Network enhancement would also help the mobile carrier shift its focus to average revenue per user, according to Chou.
“Our customer base should be big enough for us to make a profit. It’s no longer our priority to grow subscribers, but we do need to adjust the lineup of our users,” Chou said.
Vibo, which began operations in 2002, currently has 1.9 million users, but a big portion of them were students and adolescents on low-to-medium rate plans costing NT$200 to NT$300 a month. They were the company’s target demographic as it aimed for subscribers who talked a lot over the phone, but were unable to afford high bills.
This year, Vibo began offering new middle-and-high rate plans bundled with popular smartphones such as the Samsung Galaxy for free, and a minimal charge of NT$1,099 per month.
To encourage new customers to subscribe to higher rate plans, Vibo would buy more smartphones, Chou said.
Smartphones would make up about 50 percent of the company’s handset portfolio this year, Chou said. Vibo planned to buy 300,000 mobile phones to attract new subscribers and retain existing users.
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