Friday 9 October 2020

Taiwan Banks on 5G Services for Next Five Years of Growth

Taiwan has a very  dynamic and competitive mobile market comprising of five mobile network operators: Chunghwa Telecom 中華電信 , Taiwan Mobile 台灣大哥大 , FET 遠傳電信 , T Star 台灣之星 and GT 亞太電信.

High mobile penetration has resulted in intense competition to gain new subscribers. As a result, the market was quick to embrace 4G services as operators developed networks and service to provide them with a competitive edge. Operators are also gearing up to deploy 5G in a range of bands later in 2020.

The mobile segment is relatively well developed compared to other Asian markets. It has experienced negative growth over the last five years due to an increasingly saturated market. Flat to very slow growth is predicted through to 2024. The market will be constrained from higher growth due to the high penetration rate and strong local competition.

As with any shift in the market landscape, Taiwan’s three smaller players saw the introduction of LTE as an opportunity to expand their market share, principally by offering more value to end users through higher speeds and/or lower prices.

Taiwan has seen a rapid increase in mobile broadband penetration over the past five years, driven by strong growth in the number of users on LTE. Further growth during the next five years will be stimulated by the introduction of services based on 5G, which will offer faster speeds and greater flexibility. This in turn should see the addition of subscribers who choose to abandon fixed-broadband for mobile-only solutions.

The Taiwan government intends to shut down 3G networks. All five operators intended to shut down their 3G networks by the end of 2018 when their 3G licenses expired. As of 2020, 3G may still be in operation for some period/for roaming but the operators say that they will shut it down when the government orders them to do so. 2G ended in summer of 2017. 

Taiwan is still one of the few countries that offers "real" unlimited internet. Rates are amongst the lowest in the world and networks are fast and efficient, although slower speeds may be noticed at peak times. No restrictions on website access such as the firewall in mainland China are imposed. Tethering is also allowed on plans as well. Furthermore, free public WiFi networks included in the purchase of airport SIMs also provide additional online access, but users should be advised that the networks can be laggy and quite slow at times.

According to the recent report by Open Signal Taiwanese users benefit from having very strong 4G Availability, with three operators — FET, Taiwan Mobile and GT — all offering 4G Availability of 95% or higher. According to our recent State of Mobile Experience 2020 report, only six countries currently have 4G Availability that exceeds 95%: Taiwan, the U.S., the Netherlands, Japan, South Korea and Norway. It’s also important to note that GT users benefit from that operator’s roaming relationship with Taiwan Mobile, which means that GT users roam on Taiwan Mobile’s network when necessary.

Not surprisingly, operators in Taiwan are very focused on delivering a strong gaming experience to their subscribers. In February 2020 Opensignal report on the State of the Mobile Games Experience in the 5G Era, Taiwan ranked No. 24 out of 100 countries. In fact, the country had a slight edge over Canada, which has some of the best download speeds in the world.

In their analysis of data from February 1 until April 30, 2020, Taiwan Mobile won their first-ever Games Experience Award in Taiwan. 

But the island isn’t only strong in gaming. The results also show that Taiwanese consumers enjoy a pretty good experience with voice apps. In Opensignal’s Voice App Experience category, which assesses the perceived quality of voice calls using apps like WhatsApp, Skype or Facebook Messenger, four out of the five Taiwanese operators achieved scores of 80 and above on a scale of 1-100 with GT only falling slightly below 80 with a score of 79.2.

In January 2020, Taiwan wrapped up its auction of 5G spectrum with all five operators participating and spending about US$4.6 billion on spectrum, making it the third-priciest spectrum auction in the world, according to Taipei Times CHT plans to be the first to launch a commercial 5G service on July 1. The move to 5G will set off a new round of competition in Taiwan as operators look to use 5G to differentiate their offerings.

Chunghwa Telecom is the largest telecommunications provider in the country dominating the market. Their mobile products are marketed under the brand name Emome.

Chunghwa Telecom aims to deploy 3,000 5G base stations by the end of 2022. The operator has been deploying 5G base stations in the municipalities of Taipei, New Taipei, Taoyuan, Taichung, Tainan and Kaohsiung.

They have spent NT$45.67 billion ($1.52 billion) for 90 megahertz of spectrum in the 3.5 GHz band and NT$618 million for 600 megahertz in the 28 GHz band. The operator selected Ericsson and Nokia as 5G RAN vendors. Ericsson said that will use the vendor’s Radio System base stations and Ericsson’s 5G core, including its 5G Evolved Packet Core. 

Taiwan Mobile is the second provider in the country. It has also performed well in coverage and speeds. They market their products under the brand “myfone”.

Taiwan Mobile was the third major operator in the market to secure a 5G operating licence, they  acquired 60 megahertz of spectrum in the 3.5 GHz band and 200 megahertz of the 28 GHz frequency and they plan to have 4,000 base stations deployed and running by the end of 2020.

FarEasTone (FET) is the third largest operator  in Taiwan at end-March 2020, with 7.1 million subscribers, according to GSMA Intelligence data. It started in 1998, launched 4G/LTE in 2014 on 700 (B28), 1800 (B3) and 2600 MHz (B7). It has good coverage and speeds.

The operator selected Ericsson and Nokia as 5G RAN vendors. Ericsson said that will use the vendor’s Radio System base stations and Ericsson’s 5G core, including its 5G Evolved Packet Core. The operator stated that using Ericsson for 5G services will reduce the complexity of the migration for 4G to 5G, because the operator was already working with Ericsson as the sole vendor for its 4G LTE network

As part of the rollout, Ericsson Spectrum Sharing and artificial intelligence (AI)-powered radio access network solutions will be deployed. The Ericsson Spectrum Sharing will help FET to allocate spectrum assets efficiently based on traffic demand using existing infrastructure, while the AI-driven software capabilities will increase 5G coverage and 4G performance. Other offerings include Massive MIMO AIR 3239, Ericsson Spectrum Sharing, Uplink Booster and AI-powered 5G management. The communications service provider has also deployed Ericsson Radio Dots on the 3.5GHz band to boost indoor coverage.

FET had previously secured 80 megahertz in the 3.5 GHz band and 400 megahertz in the 28 GHz band.

By the close of 2020, FET aims to deploy more than 4,000 base stations and deliver “a coverage rate of up to 50 per cent of the population”. Taipei Times reported the operator planned to invest between TWD20 billion ($679.1 million) and TWD30 billion into its 5G network over the next three years: TWD10 billion of this is due in 2020. It quoted company president Chee Ching as stating signing up 1 million subscribers in the first year was “achievable”.

The operator has detailed several strategies to encourage subscribers to upgrade. A key element is its monthly tariffs, with seven-tiers available priced from TWD599 to TWD2,699 offering data rates of 500Mb/s to 1.5Gb/s. They also plan to use big data analysis to provide tailored services including “e-commerce, mobile financial services, audio-visual and e-sports entertainment, and other value-added” content.

 T Star a.k.a. Taiwan Star is Taiwan’s smallest network. It was called Vibo before and has good coverage and reasonable speeds. 4G/LTE is on 900 and 2600 MHz with a 98% coverage in 2015. T Star is however not available yet on some smaller islands.

Taiwan Star had previously selected Nokia for its NSA 5G network deployment. The operator launched its 5G network in August 2020. The coverage of its 5G networks in Taiwan’s major metropolitan areas has reached 50% and will top 80% by the end of this year. Taiwan Star also said it expects to expand its 5G network coverage to other cities, counties and the suburbs of these major metropolitan areas by 2023 and to have a total of 1,000 base stations by the end of the year, mostly in Taiwan’s six special municipalities.

The operator also said it aims to  focus on cross-industry collaborative efforts to tap emerging business opportunities including video and gaming streaming and AR/VR applications, optimizing big data analysis, cloud computing, IoT and digital marketing.

Taiwan Star currently has 2.42 million subscribers and expects to reach over four million in five years with the launch of 5G services. Taiwan Star had secured 40 megahertz in the 3.5 GHz band in a previous spectrum auction.

GT Mobile is the brand of Asia Pacific Telecom (APTC) and has been the CDMA network in Taiwan, that was closed down at end of 2017. 

The network has been switched over to 4G/LTE now. Its 4G/LTE is on 700 MHz (B28), 900 MHz (B8) and 2600 MHz in TD-LTE (as B38).

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