Far EasTone Telecommunications Co (遠傳電信) yesterday called on its local peers to set “rational” 5G flat rates, as the low rates in the market are harmful to the industry.
Far EasTone said that a monthly rate of NT$1,399 for unlimited data is too low to make a decent profit after deducting a handset subsidy of about NT$400.
The market situation contributed to poor financial performances by the nation’s smaller telecoms such as Taiwan Star Corp (台灣之星) and Asia Pacific Telecom Co (亞太電信), the company said.
Photo courtesy of Far EasTone Telecommunications Co
Telecoms registered a surge in data traffic when many Taiwanese worked from home during a level 3 COVID-19 alert, but their revenue did not expand proportionally, as flat-rate subscribers did not pay more, Far EasTone president Chee Ching (井琪) told reporters on the sidelines of a news conference in Taipei.
“Normally, we do not run our business like this,” Ching said. “We should all rethink this and what is the right mix [of mobile and fixed broadband].”
In the US, people usually use Wi-Fi networks at home, she said.
In contrast, Taiwanese flat-rate subscribers use their 4G or 5G data at home, she said.
Ahead of the commercial launch of 5G in Taiwan, Far EasTone did not plan to offer flat rates, Ching said, adding that she hopes that the model would disappear before her retirement.
Far EasTone’s 5G users on average consume 63 gigabytes of mobile data, compared with 13.9 gigabytes consumed by North American 5G users on average, Ching said.
Far EasTone said it operates about 9,000 5G base stations in Taiwan, covering 90 percent of the nation’s populated areas.
However, it would next year scale back its capital spending on 5G base station deployment, it said.
“The capital spending on 5G infrastructure should peak this year,” Ching said.
Far EasTone budgeted NT$14.9 billion (US$537.71 million) on capital expenditures this year, the highest in six years, it said.
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