Following Chunghwa Telecom's cut in the price of its asymmetrical digital signal line (ADSL) services, the Cabinet yesterday said that it planned to spend more than NT$30 billion over the next five years to reduce the price of telecommunications by creating more competition and building more broadband infrastructure.
Minister without Portfolio Tsai Ching-yen (
Tsai told the Taipei Times yesterday that the five-year budget would be spent on three major areas: construction of more "last-mile" connections; expanding regional wireless networks and creating a "dual network" system.
Yu made the request following Chunghwa Telecom's announcement on Tuesday that it would cut the prices of its 2 megabyte (MB) and 1MB ADSL service by 26.5 percent on June 1.
The current monthly charge for the 2MB/128K service is NT$1,198. Under the new rates, the charge would be NT$880 a month.
Chunghwa Telecom, which has 80 percent market share in the ADSL market, has more than 1 million 2MB subscribers and 1.5 million 1MB subscribers.
Describing the state-controlled enterprise's price cut and possible fee reduction for its text messaging service as the first step in the nation's reform of the digital and telecommunication industries, Yu spelled out the two guidelines for the government's future policy for the two industries.
In addition to offering lower prices and higher quality for digital and telecommunication services, Yu said, the government was duty-bound to create a fairer competitive environment in the two industries and to upgrade their competitive edge.
According to Tsai, the NT$37 billion, five-year plan is included in the five-year, NT$500 billion (US$15.15 billion) public construction package still awaiting the legislature's approval.
The budget would include NT$30 billion for the construction of more "last-mile" connections to people's homes, NT$6.3 billion to expand regional wireless networks and the remaining NT$700 million for the "dual network" project.
Even if consumers want to use another company as their Internet service provider, they usually need Chunghwa Telecom to install the connection in their homes, allowing the state-run company to offer better deals on connections combined with Internet services.
Chunghwa Telecom controls 97 percent of the nation's "last-mile" network, while three local fixed network companies jointly share the remaining 3 percent.
As well as raising the pressure on Chunghwa Telecom to lease more "last-mile" network to local fixed-network providers, the Cabinet plans to let local governments construct more of the network and then lease it to fixed-network and cable providers.
The "dual network" program, which allows regular mobile-phone users to get access to Internet services such as e-mail and viewing motion pictures in the areas covered by the regional wireless network system, are expected to be available in September.
Currently there are eight points in metropolitan areas covered by the "dual network" system.
They include near the National Museum of History, near a nature reserve in Kuantu, near the Shihsanhang Museum in Pali, near an ocean museum in Hengchen Peninsula and another near a flower growing zone in Chunghua County.
The Cabinet hopes to expand the coverage area to 10, plus 25 special zones such as the Hsinchu industrial park.
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