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The Long Case for Chunghwa Telecom

The problem is that Chunghwa is still basically control by the government even though their shareholding dropped to 35.41%. I remember one time when the company announced the change in tarfffs it was announced by the Premier of Taiwan not the company. The Taiwan government tends to use their influence in companies like Chunghwa to win support from the people. As far as I know Chunghwa haven't adjusted their tariff for fix line upward in 30 years to be in line with inflation so there is no money for infrastructure investment. Taiwan has one of the worst telecomunication in the developed world. There is still alot of places in Taipei that doesn't have fiber optic network. Chunghwa has used it position as the dominate provider to access to the outside world during last year earthquake which cut the undersea cable to shut out the Tier 2 Telecom companies which uses their line to provide IDD and direct all the traffic to themselves. There was nothing these Tier 2 company can do. One of the major revenue for Chunghwa is mobile phone where the tariffs are high especially calls between mobile and fix line. Since the fix line is control by Chunghwa they get a piece of the renenue from all Mobile survice providers. There is alot of demand for them to cut the tariff and with two major election coming up there is a chance that this source revenue will be cut.