A week in tech

Taiwan

Telecommunications
• Chunghwa Telecom revealed its intention to look for investment opportunities in Southeast Asia, with the company clarifying that the deals would not be in the form of a merger or acquisition. Taiwan’s largest telecom company by revenue, Chunghwa Telecom said it aims to boost its revenue base overseas. The move is a response to a near-saturated telecom market at home. Chunghwa Telecom said earlier it aimed to expand its broadband Internet operations into Thailand. The company said it already had a cooperation agreement with Thailand's TOT Corp to help support the rollout of ADSL, or asymmetric digital subscriber line, Internet services. In this strategic expansion overseas, Chunghwa Telecom said it would not limit itself to acquiring a financial stake in a company but would also look to expand its business by providing system support. In Taiwan, the company planned to focus on generating higher revenue by offering 3G-mobile phone services as it targets 1 million 3G customers by the end of this year, up from the present 313,000. At the end of February, the company's subscriber base was 8.1 million. Earlier this month, the company announced plans to launch its first early retirement program after it was privatized in August last year. The company is expecting to saving about NT$4.5 billion (US$138.6 million) through the workforce reduction.


Hong Kong

Mobile/Wireless
• Sunday Communications announced that its integration with PCCW moved another level together with the appointment of Ian Stone, chief executive of its UK Broadband unit, to head the mobile arm from June. The announcement confirms all the speculation, as Stone, the former head of SmarTone Telecommunications, returns to Hong Kong to replace Bruce Hicks, who has been Sunday's group managing director since January 2002. Sunday disclosed a loss of HK$196.9 million ($25.3 million) for last year from a restated 2004 net profit of US$4.3 million due to 3G network start-up expenses and a higher cost of sales. Sunday said it has re-branded its 3G service to PCCW Mobile as its parent company's sales team is also marketing Sunday's 3G service. The company also reported that its 2G customers registered an 8-percent year-on-year growth to 738,000. For the 3G business, the company's six-month free-trial campaign, which started in January, has attracted about 330,000 participants, of whom 110,000 have each received a free Huawei handset. The company said its revenue in 2005 from mobile services went down by 4 percent year on year to HK$993.4 million ($128 million). Factors like increased customer acquisition costs, which include handset subsidies and discounts, caused a 22 percent jump in cost of sales. Sunday said finance costs rose by 60 percent to HK$42 million ($5.4 million) due to a loan drawn down from PCCW for its 3G network build-up.

Telecommunications
• PCCW disclosed that revenue from its core telecommunications business posted a 1-percent growth to HK$17.6 billion ($2.2 billion), with pre-interest, taxes, depreciation and amortization earnings declining by 1 percent to HK$6.7 billion ($863.4 million). PCCW also identified part of its HK$197-million ($25.3 million) net loss from 79.3 percent-owned mobile unit Sunday Communications. The company said PCCW's mobile service would enable it to offer a comprehensive package of mobile, Internet, pay-television and fixed-line services. With more than 110 channels, Now has added customers to reach 554,000 from 500,000 in November. The company said its mobile unit needs time to be profitable although it does not aim at this point to invest in 3G and broadband television to the point of losses. The company’s top official said he was confident about this year’s prospects for PCCW, having been the world’s first telecommunications leader to lift its fixed-line market share from 67 percent in the first half of last year to 68 percent in December.


Singapore/Malaysia/Philippines/Indonesia

Software
• Microsoft points to software piracy as costing the Indonesian economy billions of dollars each year and is the same factor that hinders the formation of a local information technology industry. Citing a study done by the Business Software Alliance, a Microsoft Indonesia spokesperson said about 87 percent of computer software on the market in Indonesia last year was pirated. Representing an organization that represents manufacturers, the group cited problem in law enforcement and widespread corruption as just among the factors that made Indonesia the country with the fifth-highest rate of software counterfeiting in the world. The country follows Vietnam, Ukraine, China and Zimbabwe. Microsoft Indonesia forecast that a 10 percent-decline in piracy would already add $3.4 billion to the economy, following the figures from International Data Corp. Indonesia, considered Southeast Asia’s largest economy, has currently less than 100 IT companies, compared to Singapore that, with a lower rate of piracy, is a home to between 400 to 800 IT companies.

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