Chunghwa Telecom Co (中華電信), the nation’s largest telecom services provider, might stop offering unlimited 4G data plans next year, in a move likely to be followed by its peers.
“We are considering removing unlimited 4G data plans in May next year, but the decision will depend on market sentiment and the competitive landscape,” Chunghwa Telecom president Shih Mu-piao (石木標) told an investors’ teleconference.
“By June, a considerable number of two-year contracts would be expiring, so I think it will be a good time,” he said, adding that the company has introduced a variety of tiered pricing subscriptions with an eye on the possible change.
Taiwan Mobile (台灣大) and Far EasTone Telecommunications Co (遠傳電信) have both called on Chunghwa Telecom to take the lead in scrapping flat rates and adopting a tiered pricing scheme in a market where 4G subscribers rack up considerably more data use than their peers in Japan and Hong Kong.
On the back of strong marketing efforts and attractive promotional packages,Chunghwa Telecom said that its total 4G mobile subscribers had reached 3.56 million as of the end of last month.
“We aim to have 4.2 million of Taiwan’s 11 million-strong market next year,” Shih said.
He said that the iPhone 6S will continue to drive up the company’s 4G subscriber count.
In the January-to-September period, the company reported net income of NT$33.35 billion (US$1.015 billion), or NT$4.3 per share, besting previous estimates of NT$28.62 billion, or NT$3.69 per share.
Chunghwa Telecom’s revenue grew 1.6 percent annually to NT$169.57 billion during the period, higher than the NT$168.83 billion anticipated.
During the nine-months period, the margin for earnings before interest, tax, depreciation and amortization (EBITDA) stood at 37.88 percent, higher than market estimates of 36.16 percent.
Third-quarter sales reached NT$56.18 billion, up 0.1 percent year-on-year, the company said, adding that as of this month, more than 25 percent of its mobile subscribers had began adopting its value-added services and applications.
In terms of capital expenditure, Chunghwa said spending has been lower this year.
In the first three quarters, the company spent NT$15.5 billion, or 9.1 percent of revenue, less than the NT$21 billion, or 12.6 percent of sales, it spent last year in the same period.
In the third quarter, capital expenditure declined 34.6 percent sequentially to NT$5.15 billion, less than the NT$7.88 billion it spent last year.
The company’s capital expenditure budget this year is NT$30.7 billion, with the bulk of spending evenly allocated toward domestic fixed communications and mobile communications.
Chunghwa Telecom chairman Rick Tsai (蔡力行) said capital expenditure for next year would be lower than this year.
Tsai said that the company is evaluating the technology and investment efficiency of the government’s auction — likely next month — of a 2.6G spectrum, with the aim of offloading heavy network traffic in metropolitan areas.
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