Thu, Oct 29, 2015 - Page 13 News List

Far EasTone plans less spending due to 4G deployment

By Lisa Wang  /  Staff reporter

Far EasTone Telecommunications Co (遠傳電信), the nation’s No. 3 telecom, yesterday said it plans to spend less on capital expenditure next year as it is scheduled to complete most of its fourth-generation (4G) network deployment this year.

Capital spending is also expected to be on a downward trend in the following years, after spending NT$12.5 billion (US$382 million) this year and NT$13.2 billion last year, the company said.

While Taiwanese consumers generally have a higher data usage than their peers in Japan and Hong Kong, there will be no capacity issues over the next three years based on the company’s data traffic evaluation, company president Yvonne Li (李彬) told investors during a teleconference.

Far EasTone’s 4G subscribers consume on averages 10 gigabytes of data per month, about 2.5 times as much as its 3G users. However, its network utilization is still low at between 20 percent and 30 percent, it said.

At the end of last quarter, the firm’s 4G subscribers rose to 2.59 million, or 28 percent of the nation’s 4G market, according to Far EasTone.

The government is set to release new 4G spectrum bands via auctions next month and Li said Far EasTone will join the bidding to expand its 4G bandwidth.

In the past quarter, net income rose 13 percent annually to NT$3.22 billion from the previous year, exceeding the firm’s target of NT$2.86 billion.

Revenue dropped to NT$22.98 billion from NT$23.25 billion a year earlier, missing its target of NT$24.29 billion, but Li said the company is confident it will meet this year’s revenue target of NT$96.45 billion.

Margin of earnings before interest, tax, depreciation, and amortization (EBITDA) rose to 30.9 percent last quarter from 27.5 percent in the same period last year, but the number is expected to drop this quarter due to subsidies on iPhone 6S purchases, the company said.

Li called on Chunghwa Telecom Co (中華電信) to take the lead in scraping flat rates and adopting tier pricing, which will lead to “a revenue upside.”

“We are waiting for the industry leader to take the first move,” she said.

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