Chunghwa Telecom Co (中華電信) yesterday said its multimedia-on-demand (MOD) business is to make a profit in the second half of next year as subscriber numbers are to reach the break-even point of 2 million ahead of schedule.
This would mean an end to the pay TV business’ losses over the past 14 years.
Chunghwa Telecom has been struggling to turn a profit from its pay TV business due to sluggish growth in subscriber numbers, given a lack of appealing content and fierce competition from cable operators.
After reaching economic scale, the company’s next step is to boost average revenue per user of its MOD business, chairman David Cheng (鄭優) said.
To reach that goal, Chunghwa Telecom next year plans to boost the penetration rate of ultra-high-definition 4K set-top boxes in subscribers’ homes and to enrich content offerings by teaming up with global video streaming service providers to create new films and TV dramas, Cheng said.
The company is to announce new partnerships soon, he added.
Since taking over the reins in December 2016, Cheng has prioritized turning around the pay TV business within two years.
Cheng blamed tough restrictions for the business’ chronic losses, saying that the company has been “treated unfairly” for a long time.
Cheng urged regulators to relax restrictions on Chunghwa Telecom’s MOD business.
The telecom is banned from operating channels on its MOD platform and is not allowed to offer its own TV channel packages.
Chunghwa Telecom is only allowed to take 20 percent of revenue from channel operators that offer programs on its MOD platform, Cheng said.
Due to strict regulations, the company is relatively conservative about expanding its pay-TV business, compared with AT&T’s ambitious acquisition of Time Warner, Cheng said.
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