Far EasTone Telecommunications Co (遠傳電信) yesterday said that given heavy 5G spectrum costs, it would take longer than expected to see a positive contribution from 5G services on its balance sheet.
Far EasTone originally forecast that 5G services would make a positive contribution one to two years after launch, which is scheduled for the third quarter, Far EasTone president Chee Ching (井琪) said.
Ching said she now expects it to take longer than two years.
Photo: Yang Ya-min, Taipei Times
The telecom secured 80 megahertz (MHz) in the 3.5 gigahertz (GHz) band of the 5G spectrum and 400MHz in the 28GHz band at a combined cost of NT$43.04 billion (US$1.42 billion).
The nation’s four telecom operators spent a total of NT$142.19 billion on the 5G spectrum — the third-highest in the world, National Communications Commission data showed.
Far EasTone expects 5G services to boost the company’s average revenue per user mildly this year, Ching said, adding that the effect would magnify next year.
Based on the initial construction plan it submitted to the commission for review, Far EasTone plans to build 6,000 5G base stations in the next five years.
That would cost about NT$18 billion, the company said.
“This is a very conservative [estimate],” Ching said. “We will be more aggressive than that.”
Far EasTone plans to install more than 6,000 5G base stations to have wider coverage and quality Internet access, she said. The company has installed more than 10,000 4G base stations since the commercial launch in 2014, she added.
With better consumer readiness, Far EasTone expects about 20 to 25 percent of local 4G users to upgrade to 5G in the 12 months following the launch, faster than the 12 to 15 percent reported in South Korea, Far EasTone vice president T.Y. Yin (尹德洋) said.
South Korea launched 5G services in April last year, he added.
Aside from new 5G applications, smartphone replacement demand would stimulate the 5G adoption rate as well, Yin said.
Most mobile users who subscribed to the NT$499 monthly flat rate in 2018 are to renew their contracts in November, he said, adding that they are also likely to buy new phones as the old rate plans were not bundled with a subsidized handset.
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