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Taiwan Operators Focusing on Value-Added Services as Broadband Shows Promise

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One of the areas of greatest activity in Taiwan's communications market during the next five years will be the broadband market as migration to higher speed, fiber optic connections and promotion of value added services fuel its growth, according to a new report from Pyramid Research.

Pyramid Research projects that 2010 will be another tough year for operators in Taiwan. "In January 2010, regulator NCC mandated that Taiwan's operators must cut their fixed monthly rents by 5.686 percent and their mobile 2G and 3G services by 5.87 percent, all in an effort to provide some reprieve to consumers badly hit by the economic crisis of 2009," notes Daniel Yu, analyst at Pyramid Research and author of the report. "Regulators expect consumers to recognize savings of more than $100 million per year as a result of these rate cuts, a significant hit to Taiwan's service providers," he explains.

The rate cut, combined with significant competition among a large number of players, means that operators are increasing their focus on value-added services including mobile data, mobile content, broadband access, and applications, among others. "We expect mobile broadband to grow at a CAGR of 15 percent between 2010 and 2015, reaching $352 million in revenue at the end of the forecast period," says Yu. "Migration to fiber, high-speed 20-Mbit/s+ connections, IPTV, and HD will fuel fixed broadband growth over the next five years, enabling the market to generate $1.8 billion by 2015."

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Tags: fiber-optic  cagr  2g  Taiwan