Far EasTone one of six WiMAX winners

Three of the six firms — First International Telecom Corp., Global On Corp. and Wei Mai Si Telecom — won the licenses to operate WiMAX in northern Taiwan. The other three — FET, Tatung Co. and Vestar Cable TV System Corp. — won the licenses to operate in southern Taiwan.

WiMAX, or World Interoperability for Microwave Access, is a mobile Internet technology allowing users to access the Net wirelessly in a large area. The technology is a step-up from the current Wi-Fi technology that only allows coverage in a small space like a coffee shop.

A total of eight firms took part in the bidding process yesterday held by the National Communications Commission (NCC), issuer of the licenses. The two that did not get the licenses were Chunghwa Telecom and Taiwan Digital Communications Corp., a re-investment company of Taiwan Mobile Co., Ltd.

Both Chunghwa Telecom and Taiwan Mobile are the other major telecom operators in the Taiwanese market besides FET.

However, Chunghwa and Taiwan Mobile’s failure came as no surprise, as both have expressed a bigger interest in getting licenses that cover the whole island. Those licenses will be issued two years later.

In a statement, Taiwan Mobile said its failing to get the license had no substantive impact on the company’s mobile Internet business.

“We regret the fact we didn’t get a license to operate WiMAX,” Taiwan Mobile said. “But on the other hand, there has yet to be a mature business model for WiMAX, and we will continue to study the development of WiMAX and other mobile Internet technologies such as 3G, 3.5G and 3.9G to offer the customers the best service.”

Chunghwa Telecom, meanwhile, said it has already developed various fixed-line/wireless broadband technologies such as optic fiber, 3G and 3.5G to meet users’ different needs.

The bidding process yesterday was based on the percentage of revenue the bidder was willing to pay as license fee. To make the process fair to all, the NCC let the five start-ups to bid for two licenses first, one for northern Taiwan and one for southern Taiwan. The rest four licenses were then open to bidding by the rest three start-ups and the three major telecom operators. In the end, Chunghwa Telecom and Taiwan Mobile offered to pay 2.51 percent and 3.17 percent of their turnovers, respectively, as licensing fees, causing them to drop out of the competition.

FET won the bid by offering 4.18 percent of its turnover as license fee, the lowest among the winners.

FET indicated that it will actively integrate its current 2G, 3G, HSPA, Wi-Fi and WiMAX technologies to create a seamless and easy-to-access network environment.

“We will be the leading telecom service provider with comprehensive capability of digital convergence,” FET said in a statement. “We are highly confident in the broadband market of Southern Taiwan, which still has space to grow and develop. The market is full of potential.”

First International Telecom Corp., Taiwan’s fourth-largest cell phone provider by sales, obtained one of the northern Taiwan licenses by offering 12.89 percent of its sales as license fee.

The company will set up its network in the first and second quarters of next year, and operations may begin by the second half of next year at the earliest, the United Daily Evening News quoted Wu Ching-yuan, president of First International Telecom, as saying. Once the service begins, First International plans to offer NT$990 per month for unlimited Internet access, Wu said.

According to rules set by the NCC, once an operator gets the license, it has to, within 30 days of announcement of winners, pay NT$40 million as guarantee to offer the service and NT$210 million as guarantee to pay license fees. Once the operator pays the above sum, it will get the permit to set up the network, and service must begin within one year of obtaining of the permit. A one-year extension to begin the service is permitted.

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