Seven apply to bid in 3G auction

A total of seven bidders filed applications to win the right to provide 3G mobile data services in Taiwan, the government said yesterday. Five licenses are up for grabs.

The addition of the Taiwan PCS Network (聯邦電信) tilted the scale to seven after analysts predicted only six firms were likely to enter the 3G fray.

Internet-like 3G mobile data services are expected to put e-mail and videos on cellphones and transmit Internet signals wirelessly to notebook computers and PDAs within the next five years.

In Taiwan, five licenses are being auctioned for a minimum of NT$33.6 billion (US$975 million). Minimum bids for each license were priced based on the amount of bandwidth available for that particular license, at NT$7.6 billion, NT$4.2 billion, NT$7.6 billion, NT$6.7 billion and NT$7.5 billion.

"We've had seven companies apply. We're very busy here," said Vivian Wang, director-general of the planning department at the Directorate General of Telecommunications (電信總局) under the Ministry of Transportation and Communications.

Taiwan's four top cellular providers -- Taiwan Cellular Corp (台灣大哥大), Chunghwa Telecom Co (中華電信), Far EasTone Telecommunications Co (遠傳電信) and KG Telecommunications Co (和信電訊) -- all submitted bids.

One of the new fixed-line telecom firms in Taiwan, Eastern Broadband Telecommunications Ltd (東森寬頻), is also vying for a license.

The two final groups are less well-known in Taiwan's telecom sector -- Taiwan PCS Network and Worldwide Telecommunications.

Taiwan PCS Network (聯邦電信) is comprised of paging-service provider Taiwan Paging Network (聯華電信), the China Development Industrial Bank (中華開發銀行), auto manufacturer Yue Loong Motor Co (裕隆汽車) and US-based monitor firm ViewSonic Corp, according to Clinton Chiu (邱春堂), business director at Taiwan PCS Network.

"Taiwan Paging Network is our largest investor," Chiu said. The company has operated a beeper/paging service in Taiwan for over six years. It also operates a wireless mobile data service which sends messages to pager-like devices across Taiwan, servicing companies like the worldwide air freight handler, DHL.

World Telecommunications Co (世界全通), the seventh bidder, is made up of two major Taiwanese firms -- Teco Electric and Machinery Co (東元電機) and First International Computer (大眾電腦).

Teco is the majority shareholder of Taiwan's fifth largest mobile telecom firm, Taichung-based Mobitai Communications Corp (東信電訊), while First International is one of Taiwan's largest computer makers.

First International's telecom expertise comes from subsidiary First International Telecom (大眾電信), a mobile service provider that operates a wireless data transmission network developed in Japan called the personal handyphone system.

Government officials said bidding for the 3G licenses could go on past February, depending on how smoothly the process goes. The winning bidders will have to pay 30 percent of the total license fee within one year and the remaining balance over 10 years.

Despite hype surrounding the potential impact of 3G on the revenues of Taiwanese license winners, telecom stocks were mixed yesterday.