SingTel Eyes Taiwan Network License
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Singapore Telecom (SingTel) and a group of Taiwanese companies Tuesday joined together to apply for a license to operate a fixed line network in the region.
If the group wins the license, it will be able to offer voice and data leased line services, including Net access and broadband applications. A decision is expected to be delivered by the end of March, and the group intends to launch services in 2001 if the application proves successful.
Lycos Asia partner SingTel and the Far Eastern Group (FEG) form the majority owners of the consortium, named New Century InfoComm Co. Ltd. (NCIC). SingTel holds 18 percent while FEG controls 33 percent of the group's equity. If the limit for foreign participation is raised by Taiwanese regulators, SingTel will increase its stake by 20 percent.
To meet application demands, NCIC is required to have a share capital of NT$40 billion (US$1.3 billion), but SingTel says it is not investing any more than is expected from its relative ownership in the consortium.
Douglas Tong Hsu, chairman of FEG, said that high-speed Internet and other high-bandwidth applications will be in the offering, if the application succeeds, and added that the consortium plans to add mobile convergent services by leaning on the operations of certain NCIC participants.
SingTel, meanwhile, has its sights on an e-commerce market it expects to be valued at $2.8 billion by 2003.
"This investment in NCIC is part of SingTel's on-going effort to diversify its earnings base from Singapore," said Brigadier General Lee Hsien Yang, SingTel's president and chief executive officer.
"Market liberalization in Taiwan will stimulate demand for telecommunications services. We expect to see continued double-digit growth in the fixed line market, driven by robust demand for data communications."
SingTel owns interests in 62 ventures and operations in 20 countries in Europe and Asia. FEG is a leading non-electronics industrial group in Taiwan, primarily working in textile, mobile telcom, banking and shipping.
The Consolidated Network Business license application is expected to be submitted to the telecom regulator by December 30. The Taiwanese government only recently agreed to liberalize the market, which currently has only one operator.