About Chunghwa Telecom

Chunghwa Telecom Co., Ltd. operates as a telecommunications service provider in Taiwan. The company’s network infrastructure consists of transmission networks that convey voice and data traffic, switching networks that route traffic between networks, and mobile, internet, leased line and data switching networks. As of December 31, 2022, the company’s transmission networks consisted of approximately 2.9 million fiber kilometers of fiber optic cable for trunking and approximately 12.0 million fiber kilometers of fiber optic cable for local loop. As of December 31, 2022, the company has constructed approximately 11.5 million FTTx ports. The company’s FTTx service can offer high-speed broadband access rates up to 2 Gbps. For low bandwidth demand, the company uses ADSL technology to provide the internet connection services to its customers. The company’s domestic public switched telephone network consists of 19 message areas connected by a long distance network. As of December 31, 2022, the company had 38 long distance exchanges, which were interconnection points between the company’s telecommunications network and approximately 12.8 million telephone lines, which reached virtually all homes and businesses in Taiwan. The company has intelligent networks installed over its public switched telephone networks for its domestic long distance and international networks, as well as a local intelligent network mainly in the Taipei, Taichung and Kaohsiung metropolitan areas. The company’s intelligent network is designed to facilitate the use of VAS by providing more information about calls and allowing greater management of those calls. As of December 31, 2022, the company owned 12 sets of 4Tbps switch routers for the inner core network and more than 34 sets of 4Tbps/1.6Tbps switch routers for the outer core network, and the bandwidth of the network was approximately 2,060 Gbps. The company’s international infrastructure consists of multiple submarine cables, transmission networks, voice GWs and IP networks, which provide IPLC, IPVPN, Voice and Internet transit service to connect Taiwan and worldwide. As of December 31, 2022, the company had invested in 32 submarine cables, 13 of which landed in Taiwan. The total invested capacity has reached more than 26 Tbps. HiNet, the company’s internet service provider, had the largest internet access network in Taiwan, with 30 points of presence and a backbone bandwidth of approximately 18,733 Gbps as of December 31, 2022. HiNet’s broadband backbone network consists of an inner core network and an outer core network. The company had a high-speed internet protocol backbone network as of December 31, 2022 with 16 sets of 46Tbps/28.8Tbps/10.24Tbps switch routers for the inner core network and more than 46 sets of 28.8Tbps/10.56Tbps/5.28Tbps/2.64Tbps switch routers for the outer core network. The company also builds Content Delivery Network (CDN) to meet the needs of Internet/OTT services. The company’s CDN consisted of 20 domestic and five overseas point-of-presences and the total capacity is approximately 3,380 Gbps as of December 31, 2022. The company’s mobile services network consists of cell sites, which are physical locations equipped with a base station consisting of transmitters, receivers and other equipment used to communicate through radio channels with customers’ mobile handsets within the range of a cell; C-RAN (Centralized Radio Access Network), which splits base stations into two parts, the RRU (Radio Remote Unit) and the BBU (Base Band Unit). The RRUs stay at the cell site, while the BBUs are aggregated into a centralized office; RNC (Radio Network Controller) for 3G, which connects to, and control, the base station within each cell site; MSS (Mobile Switching Server) for 3G, which control the base station controllers and the processing and routing of telephone calls; SGSN (Serving GPRS Support Nodes), which connects the GPRS network to the base station controllers; MME (Mobility Management Entity), which connects the base station to its 4G/5G core network that is responsible for control side; S GW (Serving Gateway), which connects the base stations to its 4G/5G core network that is responsible for data side; PDN GW (Packet Data Network Gateway), which connects its 4G/5G core network to the internet; and transmission lines, which link to the mobile switching service centers, MME, S GW, base station controllers, base stations and the public switched telephone network in connection with the 3G/4G/5G network, and the base station controllers, the support nodes, PDN GW and the internet in connection with the GPRS/4G/5G core network. The company operates leased line networks on both a managed and unmanaged basis. In addition, the company operates a number of switched digital networks used principally for the provision of packet-switched, frame relay, asynchronous transfer mode technology and a multi-protocol label switching internet protocol VPN. As of December 31, 2022, the company had 255 frame relay ports, 716 asynchronous transfer mode ports and approximately 152,624 multi-protocol label switching internet protocol VPN virtual ports. The company has also built up its HiLink VPN that combines internet protocol and asynchronous transfer mode technologies. Business Strategy The company’s business strategy is to promote 5G intelligent applications and innovative transformation to create a new revenue growth curve for it. The key elements of the company’s strategy include focusing on its core strengths while expanding its scope of services to capture new growth opportunities; emphasizing quality of service and customer satisfaction; and expanding its business through alliances, acquisitions and investments. Segments and Principal Lines of Business The company operates through Consumer Business, Enterprise Business, International Business, and Others segments. The company operates and manages its segments as strategic business units: Consumer Business, Enterprise Business, and International Business, which provides mobile services, fixed-line services, ICT business, sales and other services. Consumer Business The company’s consumer business strategically focuses on individual- and home-centric businesses, such as mobile, fixed broadband, Wi-Fi, IPTV (MOD) and OTT services. To create value for its customers and provide better customer experiences, the company offers FTTx and ADSL services and enhance customer internet surfing experiences through its value-added services that leverage its Wi-Fi advantage, as well as IPTV (MOD) and OTT offerings. The company has the largest mobile subscriber base in Taiwan with solid network performance. The company is the largest internet service provider, or ISP, and also the largest video platform in Taiwan. Enterprise Business The company’s enterprise business focuses on creating synergy and enhancing its integrated ICT services. It also promotes the development of emerging businesses, which focus on cloud, IDC, information security, 5G+AIoT, enterprises’ digital transformation and system integration. The company has a large customer base of high-quality enterprises, including both business-to-business and business-to-consumer customers. The company’s enterprise business team identifies market insights to provide a variety of enterprise business-related services to satisfy its customers. The company is the largest IDC services provider in Taiwan, with an IDC market share of more than 50% and the leading cybersecurity service company in the market. International Business The company’s international business focuses on serving its international customers. The company’s international customers include Taiwanese companies seeking global expansion, large Taiwanese enterprises located in foreign countries, foreign companies and multinational enterprises. As the largest submarine cable service provider in Taiwan, together with the company’s international submarine cable stations, overseas subsidiaries, strategic partners and alliances, the company is well positioned to help its customers to capture global market opportunities by providing its diversified product portfolio and service offerings, including communication service, leased circuits, IDC, cloud, cross-border IoT, roaming, broadband, 5G and smart solutions. Service and Product Offerings As an integrated telecommunications service provider, the company’s principal services include mobile services, fixed-line services, ICT business, sales and other services. Mobile Services The company is Taiwan’s largest provider of mobile services. In May 2022, the company obtained 900MHz band 2x10MHz bandwidth spectrum and equipment from Asia Pacific Telecom Co., Ltd. The company offers incentives, such as mobile handset subsidies for immediate purchase, when new customers agree to sign a service contract with it or when existing customers renew their contracts with it, ranging from 12 months to 60 months. The company’s tariffs for postpaid mobile customers primarily consist of usage fees and monthly fees. The company also offers usage fee discounts on data traffic, voice call minutes and Hami Points, which are its membership points to offer a number of benefits, including gift redemptions and other rewards, to encourage subscription to its 5G mobile service. Fixed-line Services The company’s fixed-line services include fixed broadband services, fixed voice services, leased line services, video services and satellite services. Fixed Broadband Services: The company’s fixed broadband services mainly consist of broadband access, data communication services and Wi-Fi services. The company provides broadband access through connections based on its FTTx and ADSL technologies. The company is continuously expanding its high-speed FTTx household coverage and encouraging more migration of its FTTx subscribers to higher-speed FTTx service. The company’s data communication service includes HiNet, its brand name as an ISP, and HiLink, a VPN service for enterprises. The company was the largest ISP in Taiwan as of December 31, 2022. As of December 31, 2022, approximately 81.9% of the company’s broadband customers were also HiNet subscribers, using HiNet as their ISP, and 91.8% of its FTTx service customers subscribed HiNet ISP service. The company also provides Wi-Fi services. The company also provides home Wi-Fi devices rental services. The company also had more than 31.6 thousand hot spots in public areas as of December 31, 2022. Fixed Voice Services: The company’s fixed voice services mainly consist of local telephone, domestic long distance telephone and ILD telephone services. The company is the leader of the local telephone service market. The company provides domestic long distance telephone services in Taiwan. The company also provides ILD telephone services in Taiwan, primarily international direct dial services and wholesale of ILD traffic. Leased Line Services: The company is the leading domestic leased line services provider and the leading international leased line services provider in Taiwan, primarily offering exclusive lines that allow point-to-point connection for voice and data traffic. Leased lines are used by business customers to assemble their private networks and by telecommunications service providers to establish networks to offer telecommunications services. The company’s leased line services mainly consist of local and domestic long distance and international leased line services. Video Services Using video streaming technology through set-top boxes connected to the company’s FTTx and ADSL data connections, its MOD customers can access TV shows, video on demand, OTT and other services. The company had over 195 channels, including 192 high definitions, or HD, and one 4K resolution, or 4K, channels, and over 45,000 hours of on-demand programs as of December 31, 2022. In addition to its regular packaged offerings, the company offers SVoD services for film and drama. Starting from 2017, the company’s MOD platform has successfully provided OTT services, such as KKTV and Netflix. The company’s OTT platform, Hami Video, also provides over 90 channels and offers a large number of selected videos, 4K broadcasts and multi-angle videos. The company has launched optional service packages with customized subscriptions to satisfy customers’ preferences. The company will continue to develop its customer stickiness by investing in content with higher video performance on its different platforms. This strategy enables the company to maintain its leading position as the largest video platform in Taiwan. Satellite Services The company entered into a contract with ST-2 Satellite Ventures Pte., Ltd. on March 12, 2010 to lease capacity on the ST-2 satellite. The lease term is 15 years. As the company’s ST-2 satellite is in good operating condition, the expected lifespan is extended for another three years and three months after evaluation in 2021. In addition, the company has two satellite communication centers that enable it to provide TV broadcasts, satellite VAS and backup systems in responding to major emergencies. The company also provides satellite services to Southeast Asia. In November 2022, the government opened for telecommunications enterprises to register radio frequency for Ku-band and Ka-band satellite internet services, which include low earth orbit, or LEO, service. In March 2023, the company entered into a new agreement with Singapore Telecommunications Limited to jointly invest in a new satellite project to upgrade and replace its aging ST-2 satellite. This collaboration enables the company to provide all the services and capabilities of the current generation, together with a substantial number of improvements in service quality and capabilities. Information and Communication Technology (ICT) Business By integrating various technologies, such as cloud computing, cybersecurity, big data, IoT and accelerating emerging services, the company provides customized ICT total solutions to enable its business customers to improve efficiency: The company’s IDC is under centralized management, and it saws increasing occupancy in its highest-rated Banqiao IDC with strong potential demand. This strong potential demand has driven the company to work on its next business expansion. The company is also a cloud service provider. The company’s CHT cloud service is a multi-cloud network convergence service. With a high-quality global network as the basis for all cloud services, it integrates the company’s self-developed cloud service, hicloud and other public cloud services, including Amazon Web Services, Microsoft Azure, and Google Cloud Platform. In addition, the company cooperates with its subsidiary, CHT Security Co., Ltd., to provide HiNet Advanced Networks Defense System, or ANDs, and Web Application Firewall, or WAF. ANDs can combine with HiNet Security Fleet solution to upgrade users’ information systems security. The company also provides Content Delivery Network, or CDN, service. This service effectively speeds up content delivery on websites with high traffic. The closer the CDN server is to the user geographically, the faster the content will be delivered. The company provides CDN service to internet content providers to ensure stable quality when programs are broadcasted. The company will expedite CDN construction to enhance digital convergence product competitiveness. Besides, the company’s CDN is effectively integrated with IDC. With the combined solution, the company’s customers can place the server in IDC as the origin site, and CDN can distribute the site traffic to the internet with high efficiency and stable quality. Taking advantage of the speed, low latency and high connection capacity of 5G technology, the company also offers its enterprise customers private 5G network services. This dedicated network provides a secure and reliable connectivity solution for various industrial applications, including enterprise intranet transmission, ensuring data security and improving scalability and efficiency. Furthermore, regarding ‘5G AIoT’ applications, the company proactively launches several vertical applications and solutions, including intelligent transportation system, iEN, intelligent video surveillance service offers, smart healthcare and eHome. The company’s 5G service is to accommodate a large number of IoT devices for data transmission with exceptional efficiency and stability. The company’s 5G service includes CVP traffic sign optimization, solar energy system management and telemedicine (virtual clinic) with low latency for rural areas. With the advantages of big data analytics and artificial intelligence (AI) technology, the company provides various data-enabled services to help government agencies and enterprises in digital transformation, including building big data platforms, customizing various business intelligence and AI solutions, as well as integrating machine learning technologies. Sales The company engages in the distribution and sales of mobile handsets and wearable devices for use on its mobile network to customers through its directly-owned stores, its online store, Senao International Co., Ltd. (SENAO), and also through third-party retailers. Interconnection The company provides interconnection of its fixed line network and mobile network with other operators. Sales and Distribution As of December 31, 2022, the company had 17 operations offices for operations, 447 service centers and 15 customer service call centers for sales and customer service. In addition, the company has simplified transaction process on its online store to improve customers’ experience, and it enhanced its service efficiency by increasing digital channel access of contactless transactions. The company also had 244 SENAO exclusive service stores as of December 31, 2022. The company’s investment in SENAO continues to enhance its mobile handset distribution and sales capabilities in which customers can subscribe to its broadband service, MOD service and other services at SENAO retail stores. Competition ICT Business IDC Service: The company’s major competitors include Far EasTone, Taiwan Fixed Network and Acer Cyber Security. The company’s major competitors in cybersecurity include Acer Cyber Security Inc. and ISSDU Inc. in terms of cybersecurity professional services, and TAIWAN-CA Inc. in terms of identification business. The company’s major competitors in cloud services are cloud services resellers and system integration service providers, including eCloudvalley Digital Technology Co. Ltd, CKmates International Co. Ltd, CloudMile Inc., Nextlink Technology Inc., Acer E-Enabling Service Business Inc. and SYSTEX Corporation. Regulation Under the Personal Information Protection Act, or PIPA, every individual or governmental or non-governmental agencies, including the company, should be subject to certain requirements and restrictions for collecting, processing or using personal data. History Chunghwa Telecom Co., Ltd. was founded in 1996. The company was incorporated in 1996 in the Republic of China pursuant to the Article 30 of the Telecommunications Act.