Taipei, May 14, 2008 (CENS)--Chunghwa Telecom Co., Ltd., Taiwan`s No.1 telecom carrier, recently announced its joint venture Viettel-CHT, in partnership with Vietnamese telecom carrier Viettel, gaining a foothold in the vast Southeast Asian telecom market.

The joint venture, according to Chunghwa`s executives, will initially engage in Internet Data Center (IDC) service and may tap Cambodia`s mobile-service market.

The venture is capitalized at US$30 million and headquartered at a hi-tech industrial park in Ho Noi of Vietnam. Viettel holds a 70% stake while Chunghwa owns the remaining 30% of the venture, hence each taking three and two seats on the venture`s director board in accordance with ownership proportion.

The venture will start operation some time next quarter on a 1,000-square-meter site and expects to begin making profit in three years, during which time the company`s site will expand to 30,000 square meters. Currently, it is staffed with 20 employees, including six from Chunghwa, with the staff size to increase to 50 next year.

Chunghwa Chairman D. Hochen said SingTel had competed against his company for the chance to form the venture with Vittel. He added his company would form more ventures with Vittel in the future.

Insiders pointed out Chunghwa was more interested in mobile service market in Vietnam and Cambodia than in IDC market. Chunghwa`s executives noted Vietnam now has a population of 85 million, but mobile service penetration is only 40%. With the low cellular penetration, Vietnam has been considered as the world`s fastest-growing telecom market after only mainland China. Most of the users in Vietnam are using second-generation (2G) systems and prepaid cards, setting up the southeast Asian nation as a huge market.

Chunghwa originally planned to invest in Vietnamese mobile-service provider VNPT, which now operates two mobile providers.

Hochen said he hoped the joint venture would help his company and Vittel smoothly enter the Cambodian market, with the latter having acquired license to offer service in Cambodia and Vietnam.

The venture is the first overseas telecom investment by the No.1 Taiwanese telecom carrier.
(by Ken Liu)