Chunghwa Telecom Co (
Chunghwa Telecom chairman Hochen Tan (賀陳旦) called a short-notice press conference yesterday morning to introduce the 8M broadband internet service.
"The service is provided in Japan for roughly NT$1,450 per month, but we will offer an even more economical package than that," Hochen said.
The final rates would be decided in conjunction with the Directorate General of Telecommunications, under the Ministry of Transportation and Communications, he said.
According to statistics provided by the Directorate General, Taiwan's ADSL rates are roughly 4 times that of Japan's for 1.5M to 2.3M ADSL service. For 3M to 8M ADSL service, Chunghwa Telecom's prices are roughly 20 times that of Japan's.
Chunghwa held about 74 percent of Taiwan's ADSL market in February. The company is under pressure to lower rates for ADSL services, compared to most Asian countries including South Korea and Japan.
A protest group, dubbed the Protest Chunghwa Telecom Association and comprised of members who met online, has announced plans to surround the Legislative Yuan on May 1 to call for the liberalization of "last mile" access.
Chunghwa Telecom controls the "last mile" connections to most households, and are therefore able to refuse access to competitors.
Group representative Hsu Wen-jen (
The question of whether ADSL fees are overly expensive has long been debated and was brought to the fore again last week when students issued complaints with President Chen Shui-bian (
At the time, Chunghwa Telecom announced an "economy package" to be offered in May that would make available 256K of online service for NT$699 per month.
Previous calls to lower ADSL fees resulted in packages that offered heavy ADSL subscribers preferential rates and bandwidth expansion incentives but failed to cut prices across the board.
"Chunghwa Telecom needs to rethink service charges to come up with a reasonable way to bring down ADSL prices. Most importantly, last mile access should be rented to other operators. The last mile was constructed with taxpayer money so it should benefit consumers, not financial syndicates," said Consumers' Foundation Secretary General Cheng Jen-hung (
"In determining whether or not ADSL fees are too high, we can't just look at figures alone. For example, Chunghwa Telecom has low installation fees and does not charge for modem use," Hochen countered yesterday.
With regards to the impact of ADSL prices on the company's stocks, Masterlink Securities Corp analyst Michael Chen (
"ADSL prices should not have a large effect on the prices of the company's shares primarily because of its diverse inflow of revenue," Chen said, adding that the new 8M package served as a strong price catalyst for the company.
In addition, Chen pointed to the possibility of a 5 percent to 10 percent drop in stock prices if ADSL prices were cut, but predicted that prices would be back up within three months' time.
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