Chunghwa Telecom Co (中華電信) aims to expand its 4G customer base to about 6.4 million users next year, with a nearly 40 percent share of the market, a company executive said yesterday.
The nation’s biggest telecom operator, which is on track to hit its target of 4.4 million 4G users since the service was launched in May, said that consumers’ concerns about speed and network coverage have been mostly resolved.
“We expect more customers — especially 2G users — to migrate to 4G services, particularly 2G users,” Chunghwa president Shih Mu-piao (石木標) told reporters on the sidelines of a press conference.
About 30 percent of the company’s 900,000 2G users are expected to shift to 4G by the end of March, when a government subsidy for the migration ends, Shih said.
In October, the government unveiled a NT$5 billion (US$151.4 million) economic stimulus package, including a subsidy of NT$2,000 per phone and a service fee of NT$200 for three months for 2G users upgrading to 4G.
“We have run out of stock of certain 4G phones designated for 2G users to replace their phones for free,” Shih said.
The company expects the total number of 4G subscribers in Taiwan to grow to at least 17 million next year, from more than 11 million this year, he said.
Chunghwa yesterday also said it is continuing to expand its 4G network. The company plans to open a newly obtained 60MHz 4G bandwidth to users in the second quarter of next year after acquiring the spectrum for NT$9.95 billion early this month.
Commenting on a potential collaboration with US over-the-top (OTT) operator Netflix Inc when it enters Taiwan next quarter, Shih said the two sides are in talks about hardware leasing and other issues. He did not elaborate.
OTT operators offer digital content, such as movies, music, sports, or news, over the Internet, rather than through satellite or cables.
Chunghwa also provides OTT services, but the business is struggling to make a profit, he said.
“The cost of royalties paid for licensed content is too high, while income from advertisements is too little,” Shih said. “It is not easy to expand our customer base to an economic scale.”
The company expects OTT users to grow to 500,000 this year.
Chunghwa’s media-on-demand (MOD) pay TV service faces the same problem. Its MOD business has been in the red since its launch 10 years ago and it could take a couple of years to break even, Shih said.
However, rival OTT operator TGC Taiwan Inc (替您錄科技), which offers its services under the name LiTV, is banking on close collaborations with both hardware makers and content providers to make a profit.
TGC chairman and chief executive officer Chien Ta-wei (錢大衛) yesterday said the company is teaming up with SetTV (三立電視) and Hon Hai Precision Industry Co (鴻海精密) to provide low-cost TVs and mobile phones to better serve LiTV subscribers.
The LiTV system operates 71 channels, with the number expected to increase to more than 80 next month, he said.
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