Subscription pricing model will alter with 4G: industry

By Ted Chen, The China Post

TAIPEI, Taiwan — Smartphone users may be subject to revised subscription pricing models following the commencement of operations of the forthcoming fourth-generation (4G), announced Taiwan’s leading telecoms carriers yesterday.

According to industry experts, telecoms carriers are poised to benefit from the expected surge in data usage volumes in the post-4G era, but most rely on the preceding 3G and 2G networks in offering voice calls. Telecoms carriers yesterday also expressed an upbeat outlook on adopting the mobile broadband-enabled Voice over LTE (VoLTE) solution as an alternative. Companies stated that they are expecting the increase in mobile data transmission to offset the loss of revenue from voice calls following the introduction of VoLTE services.

VoLTE, a system that first saw implementation in South Korea, will also represent a boon to the number of new entrants to the telecoms sector, including a company backed by the formidable Hon Hai Precision Industry Co. According to industry experts, regulations stipulate that market leaders are prohibited from refusing collaborative endeavors with newer entrants to the sector, allowing compensation for the lack of network infrastructure assets while providing adequate coverage to subscribers.

New entrants however, face the challenge of swiftly establishing a high standard of service as VoLTE is heavily dependent on mobile broadband coverage. Early adopters in South Korea have reportedly achieved stellar results with VoLTE, providing improved voice call quality over conventional means, and applications such as Line, WeChat, and Skype. Experts however noted that handsets that support the function are predominantly of South Korean origin, such as LG and Samsung, adding that the service may not be available to subscribers in Taiwan using non-South Korean mobile devices.

Telecoms carriers yesterday stated that while no details will be disclosed, new pricing models will be devised according to precedents observed in neighboring South Korea, Japan, Hong Kong, and Singapore.

Current 4G carriers including Hong Kong’s SmarTone, and, and China Mobile across the strait still employs the unlimited usage pricing model commonly found in the Taiwan market. Though total usage is unlimited, data transmission speeds will be throttled at 128kpbs once users have exceeded a set limit, to prevent congestion for other subscribers. SmarTone currently sets the monthly throttle limit at 5gigabytes of data usage. The average monthly fee for the throttled unlimited usage scheme falls at about NT$836, on par with prices seen in Taiwan excluding voice calls.