Conference on the 2016 Outlook and Challenges of Taiwan’s Telecommunications Industry

Trans-editor: Yating Chan/ Proofreader: Yu-li Liu

Date: Dec. 25, 2015 

Venue: GIS NTU Convention Center

On December 25, the Taiwan Communication Society (TCS) held the 2016 Conference on the Outlook and Challenges of Taiwan's Telecommunications Industry at the GIS NTU Convention Center in Taipei.

In her opening speech, TCS President Yu-li Liu thanked the public, experts, and academia for joining the discussion and stated that she hoped the annual conference would serve as a platform for open dialogue on and mutual understanding of Taiwan's telecommunications policies.    

In the guest of honor speech, Taiwan's National Communications Commission (NCC) Chairperson Howard Shyr highlighted the open spirit of the Digital Convergence Draft Acts, as the five key telecom players in Taiwan had further called for a reduction in spectrum fees.

Vice Chairperson of the NCC, Hsiao-Cheng Yu, said that further discussions on spectrum fees would be initiated and different prices for high and low spectrums would be a future legislative direction. 

NCC Chairperson Howard Shyr said that Taiwan's telecommunications is entering a new era with the rise of the currently non-regulated Over the Top (OTT) industry, although the Legislative Yuan has just passed amendments to three broadcast laws, which are high-regulation, after its six-time party caucuses.

The new Digital Convergence Draft Acts, Shyr added, are focused on setting up an open framework to facilitate a more sound and comprehensive telecommunications environment. The Electronic Communications Draft Act, said Shyr, is in essence a civil law in that its regulatory power is only exerted when a violation of individual rights occurs. Other Digital Convergence Draft Acts have loosened the regulations on telecom operators' business and spectrum licenses, allowing registered (no longer restricted to licensed) operations and spectrum re-auctions.

NCC Vice Chairperson Hsiao-Cheng Yu, who served as the moderator of the first session on Key Trends & Issues in Telecom Industry Development, concluded that a 3G spectrum re-farming plan and a reasonable spectrum fee mechanism are worthwhile, and stated that he looked forward to seeing a well-discussed 3G business solution proposal from Taiwan's five major telecom companies.

Chunghwa Telecom President Mubiao Shih pointed out that telecom operators' continual infrastructure development is the drive behind a rapid increase in the number of Taiwan's 4G users, and that the infrastructure development would serve as the backbone for foreign OTT, mobile commerce, and the Internet of Things (IoT), further pushing telecom operators to upgrade to smart pipes.

Taiwan Mobile President James Cheng said that the annual spectrum fee is currently too high for telecom operators to afford better services for phone users and that he hopes the government would consider only charging a one-time spectrum license fee.

Far EasTone Telecomunications President Yvonne Li said that releasing a spectrum affects a country's industry planning, and promising future business applications, such as IoT or the Internet of Vehicles (IoV), are better included in the whole spectrum release scheme. Li also called on the government to adjust the current one-way payment policy on IP Peering.

Taiwan Star Telecommunications President Cliff Lai said that small players are a key balancing force in the market and that the government should set rules that allow them to compete on a level footing with their bigger counterparts.

Asia Pacific Telecom Chairman Fang-ming Lu echoed Cheng's opinion and further added that cooperation between telecom operators, such as setting up co-located base stations to reduce maintenance costs, can make better use of spectrum resources.  

Telecom Technology Center President Ta-Sung Lee said that mobile broadband Internet planning and management will become more challenging and that Software-Defined Networking (SDN) and Network Function Virtualization (NFV) will thrive in future mobile broadband internet technologies.

Zse-Hong Tsai, Professor at the Graduate Institute of Industrial Engineering, National Taiwan University, hosted and presented in the second session on Competitions in the Telecom Industry and the Digital Convergence Draft Acts.

Tsai pointed out that there are currently many peering models on the market, such as telecom to IP, mobile peering, IP peering, 4G peering, and 4G VoLTE peering, yet Taiwan's telecom and broadband regulations have not yet set a clear and accurate definition for these peering models even though the country's peering rate has risen rapidly.

Yuntsai Chou, Professor in the Department of Information Management, Yuan Ze University, said that the only innovative idea in the NCC's Digital Convergence Draft Acts was 「licensed-shared access」 (LSA), while other regulatory articles in the Electronic Telecommunications Draft Act, Telecommunications Draft Act, and Telecommunications Infrastructure And Resources Management Draft Act have maintained the concepts in the current regulations.

Po-Li Liu, President of the Taiwan Institute of Economic Research Division IV, said that the Digital Convergence Draft Acts are steps in the right direction, as IP amount will be a core value to the telecom industry, and that it is worth observing how the acts will enable operators to provide more than pure voice/data services in the future.

Ching-Ho Chen, Vice President of Shih Hsin University, provided personal observations from a communications perspective. Chen said that although OTT relies on telecom operators' infrastructure to provide users' best experience and quality content, it still needs to cooperate with the content industry.

Li-Chiu Liu, Secretary-General of the Taiwan Telecommunications Industry Development Association, said that the Telecommunications Draft Act allows newcomers to the communications industry to register for businesses, which means that they can rent the already established infrastructure from telecom operators, further decreasing telecom operators' incentives for infrastructure development.

Leo Fang, a professor-rank specialist at the Graduate Institute of Patents at National Taiwan University of Science and Technology, said that telecommunications is not only about human rights but also about a country's economic development and fair market competition.  

Yi-Ning Chen, NCC Commissioner, hosted the third session on Multiple System Operators and the New Media. She stated that as an independent regulatory and counseling committee, the NCC will include all presenters' opinions and suggestions in its future planning.

Chung-Jen Chang, Director-General of the Bureau of Audiovisual and Music Industry Development, Ministry of Cultural Affairs said that on average, the production cost of Taiwan's TV programs is low, and that to create a new business model, TV programs producers should consider incorporating e-commerce into their shows. 

Kevin Lin, General Counsel of the Taiwan Broadband Counseling Corporation, said that many articles in the Multiple-System Operators and Platforms Regulations Draft Act require improvement and that the government should actively regulate local and foreign OTT while cracking down on illegal OTT. 

Sally Chen, President of the ELTA Technology Corporation, encouraged Taiwan's multiple-system operators to embrace new ideas and think outside the box, as in the foreseeable future, mobile TV will become the mainstream.

Li-Mei Weng, Vice President of Netwave Group, said that in facing the tremendous challenge of new media, multiple-system operators need to provide more diverse services to meet subscribers' needs by incorporating wireless systems and Internet platforms into their businesses.

Nelson Tsai, Professor in the Department of Radio, Television & Film at Shih Hsin University, said that multiple-system operators should design more user-friendly end devices and try to change viewers' behavior and watching habits if possible.

Wen-Yi Hsu, General Secretary of the Taiwan Communications Society, said that the government should establish comprehensive regulations for fair market competition and that multiple-system operators should adopt a fixed-mobile-convergence (FMC) approach to profit on digitized platforms to provide better user experiences and should develop their own OTT (or cooperate with other OTTs) to claim a larger market share.

Yu-li Liu, President of the Taiwan Communications Society, hosted the fourth session on Streaming Media and the Digital Convergence Draft Acts. She suggested that the current framework of the draft acts should be simplified and made more coherent, specifically in terms of 「same services, same regulations,」 as the current version seems to reflect both Japan's and the E.U.』s regulatory approaches.

Bo-Zong Weng, an NCC Commissioner, said that broadband will be the backbone for the future development of the digital communications industry, as streaming media have relied heavily on fixed and mobile Internet, and that only by integrating fixed and mobile broadband to provide video experiences anytime, anywhere can the industry satisfy the diversified need in the market. 

Chong-Jian Liu, Professor in the Department of Economics at National Taipei University, said that implied concern about the digital communications industry's development has led to a contradictory competition between 「network externality」 and 「increasing marginal revenue.」 The result may be that the winner takes all, Liu said.

Ying-ching Hsieh, a lawyer for Shay & Partners, said that the public broadcasting system should be separated from the commercial media, as accurate market segmentation is needed, and that the current problems of the commercial media industry lies in low law enforcement of TV monopolies and content right violations.

Shu-Fen Peng, President of the Cable Broadband Institute in Taiwan, made three suggestions for the Digital Convergence Draft Acts and said that she wished the government would give the public more time to discuss and respond to the draft acts.

Zhih-Liang Yeh, Assistant Professor in the Department of Information Communications at Yuan Ze University, suggested that the NCC should clearly define OTT and the differences between telecommunications services and traditional communications services in the current draft acts, as there is still a great deal of vagueness that requires further explanation.

May Chen, General Secretary of the Satellite Television Broadcasting Association, said that she wished that the government would readjust its policies on media self-regulation, governance, and regulations in the spirit of 「same services, same regulations,」 as different regulatory policies are currently applied to different new platform operators in the market.