Chunghwa Telecom Interview

I had an interview with Chunghwa Telecom. Chunghwa now has 360 thousand IPTV subscribers for its Multimedia On Demand (MOD) service that it offers in Taipei and the other two largest cities in Taiwan. It expects its IPTV network to receive a government license before the end of 2007. With that license it will be able to deploy IPTV across the entire island of Taiwan. This license will also provide Chunghwa access to additional TV channels and other content that will bring its service up to the same level as the cable companies in Taiwan.

Chunghwa is currently conducting trials of HD content that it expects to introduce in 2008. The cable companies in Taiwan are not able to offer HD content, so this will give Chunghwa a significant competitive advantage. It believes that there will be strong interest in HD in Taiwan.

Chunghwa’s karaoke on demand and game offerings are also popular. Many subscribers use its karaoke on demand service. It offers a finger-guessing game that was developed on Japan using adult contents. The Major League Baseball game is also popular because many people are following Chien-Ming Wang, who plays for the New York Yankees.

Chunghwa’s IPTV service is based on the following systems:

• Alcatel access systems along with its installed base of ECI systems for ADSL-2+.
• It will soon start deploying EPON based on Sumitomo systems
• Video headend from Ericsson’s Tandberg TV
• Video on demand from Alcatel
• Middleware is Alcatel’s OMP system
• Content security from Widevine
• Set-top boxes form Foxconn and Hwacom

Chunghwa’s technology base has been evolving since it introduced its service. It used Orca middleware and Pace set-top boxes for its first 40 thousand subscribers and then switched to Alcatel-Lucent’s OMP and both Foxconn and Hwacom set-top boxes. Moving its subscribers from Orca and Pace to its current systems has been difficult and is just now completing.

Chunghwa expects to continue its evolution and is currently considering converting to the Microsoft Media Room IPTV software. There was an announcement in May of a broad joint relationship between Microsoft and Chunghwa that included moving its MOD service to the Media Room.

Chunghwa is making good progress and it looks like its IPTV service should accelerate next year after it receives its certification. It is following a difficult technical path with all of these changes in technology, but it should continue to do well as long as it keeps its focus on providing the best service to its customers.