Chunghwa Telecom Co Ltd (CHT) 2012 Q3 法說會逐字稿

Good evening, ladies and gentlemen. Welcome to Chunghwa Telecom conference call for the Company's Q3, 2012 operating results.

先生們女士們晚上好。歡迎參加中華電信電話會議，了解公司 2012 年第三季度經營業績。

During the presentation, all lines will be in listen-only mode. When the briefing is finished, directions for submitting your questions will be given in question and answer session.

在演示期間，所有線路都將處於僅監聽模式。簡報結束後，將在問答環節中給出提交問題的指示。

For your information, this conference call is now being broadcast live over the Internet. Webcast replay will be available within an hour after the conference call is finished. Please visit www.cht.com.tw/ir under the In Focus section.

供您參考，本次電話會議現通過互聯網進行現場直播。電話會議結束後一小時內將提供網絡廣播重播。請訪問 www.cht.com.tw/ir 的“聚焦”部分。

Now, I would like to take it over to Fu-fu Shen, the Director of Investor Relations. Thank you. Ms. Shen, please go ahead.

現在，我想把它交給投資者關係總監沉福福。謝謝。沉女士，請講。

Thank you. This is Fu-fu Shen, the Investor Relations Director for Chunghwa Telecom. Welcome to our third quarter 2012 results conference call. Joining me on the call today are Dr. Lu, Chairman; and Dr. Yeh, CFO.

謝謝。我是沉福福，中華電信投資者關係總監。歡迎參加我們的 2012 年第三季度業績電話會議。今天和我一起參加電話會議的是董事長盧博士；和首席財務官葉博士。

During today's call, management will first discuss business, operational and financial highlights, then followed by Q&A.

在今天的電話會議中，管理層將首先討論業務、運營和財務要點，然後進行問答。

On slide number 2, please note our safe harbor statement.

在第 2 號幻燈片上，請注意我們的安全港聲明。

Now, I would like to turn the call over to Chairman Lu.

現在我想把電話轉給盧主席。

Thank you, Fu-fu. Hello, everyone. This is Shyue-Ching Lu, Chairman of Chunghwa Telecom. Thank you all for joining our third quarter 2012 earnings results conference call.

謝謝你，福福。大家好。我是中華電信董事長盧學慶。感謝大家參加我們的 2012 年第三季度收益電話會議。

Before getting into our business overview on slide number 4, I'm glad to share with you that, according to recent third party customer surveys, our broadband and MOD services continued to be extremely well received, and highly ranked by our customers.

在進入第 4 張幻燈片的業務概述之前，我很高興與您分享，根據最近的第三方客戶調查，我們的寬帶和 MOD 服務繼續受到客戶的熱烈歡迎和高度評價。

The Global View magazine found that our fiber access services enjoys a high customer satisfaction rating, among other various broadband access technologies, including ADSL, cable modem and data costs. Since Chunghwa provides the most comprehensive fiber access services in Taiwan, we believe that we are well positioned to capitalize on growing customer demand for such high quality entertainment options. Additionally, a recent survey by the Taiwan Digital Convergence Development Association showed that customers regard Chunghwa's IPTV services as more superior than our competitors' cable TV, in terms of picture quality, channel selection, as well as overall general service satisfaction.

《Global View》雜誌發現，我們的光纖接入服務與其他各種寬帶接入技術（包括 ADSL、電纜調製解調器和數據成本）享有很高的客戶滿意度。由於中華在台灣提供最全面的光纖接入服務，我們相信我們有能力利用客戶對此類高品質娛樂選擇不斷增長的需求。此外，台灣數位融合發展協會最近的一項調查顯示，客戶認為中華的IPTV服務在圖像質量、頻道選擇以及總體服務滿意度方面優於競爭對手的有線電視。

In fact, approximately 94% of the respondents said that they were impressed by Chunghwa's MOD broadcast of the Olympic Games this summer, which has led to greater interest from advertising customers.

事實上，大約94%的受訪者表示，今年夏天中華電視台MOD轉播奧運會給他們留下了深刻的印象，這引起了廣告客戶的更大興趣。

We are encouraged by these survey results, which clearly demonstrate the value our customers find in Chunghwa's diversified and innovative services. We will continue to offer innovative and high quality services to meet the needs of our customers in today's evolving digital and mobile world.

這些調查結果讓我們深受鼓舞，它清楚地表明了客戶對中華多元化和創新服務的價值。我們將繼續提供創新和高質量的服務，以滿足當今不斷發展的數字和移動世界中客戶的需求。

Now, let's go through our businesses. Please refer to slide number 6 for our Mobile business.

現在，讓我們回顧一下我們的業務。請參閱幻燈片 6 了解我們的移動業務。

We continue to maintain our leadership by providing fast, reliable and seamless wireless access and, at the same time, a greater customer service experience for our customers.

我們通過提供快速、可靠和無縫的無線訪問，同時為客戶提供更好的客戶服務體驗，繼續保持我們的領先地位。

We also continue attracting new customers with our price competitive mobile plans. By leveraging our customer base through attractive data plan upgrades, our smartphone adoption expectations remain on track.

我們還繼續通過具有價格競爭力的移動套餐吸引新客戶。通過有吸引力的數據計劃升級來利用我們的客戶群，我們的智能手機採用率預期仍處於正軌。

For the third quarter of 2012, smartphones accounted for 67% of all new handset sales. As a percentage of postpaid subscribers, smartphone penetration increased to 35.3% at the end of the third quarter. By year-end, we expect this rate to approach 39%.

2012 年第三季度，智能手機佔所有新手機銷量的 67%。截至第三季度末，智能手機滲透率佔後付費用戶的百分比增至 35.3%。到年底，我們預計這一比率將接近 39%。

In addition, we continue the expansion and transformation of many of our retail stores while, at the same time, extending opening hours in our high traffic locations to better service our customers. During the third quarter, we added 30 service stores, bringing our accumulated total to 605 service centers and stores [island-wide].

此外，我們繼續對許多零售店進行擴張和轉型，同時延長人流量大的地點的營業時間，以更好地服務客戶。第三季度，我們新增了 30 家服務店，使[全島]服務中心和商店的總數達到 605 家。

Moving on to slide number 7. Mobile Internet Service revenue continues its strong growth momentum in the third quarter 2012, with over 21.5% year-over-year growth. We believe that this trend remains sustainable, as we continue to see the strong adoption of smartphones and other mobile Internet devices.

轉到第7張幻燈片。2012年第三季度移動互聯網服務收入繼續保持強勁增長勢頭，同比增長超過21.5%。我們相信這種趨勢仍然可持續，因為我們繼續看到智能手機和其他移動互聯網設備的強勁採用。

We continue to roll out new promotional campaigns targeting new and existing customers. For example, we recently began offering a new promotional plan that provides subscribers favorable voice tariffs, with mobile Internet service. Due to its competitive offering in the market, we believe this campaign to be well received by customers, from our preliminary results.

我們繼續針對新老客戶推出新的促銷活動。例如，我們最近開始提供一項新的促銷計劃，為訂戶提供優惠的語音資費和移動互聯網服務。由於其在市場上具有競爭力的產品，從我們的初步結果來看，我們相信該活動會受到客戶的好評。

Slide number 8 shows the results for our Broadband businesses. Attracting new customers while migrating existing broadband customers to higher speed service continues to be our key strategy and focus. While competition in the cable market is becoming more intense, we believe that the higher quality we offer through our competitively priced fiber and ADSL connections will continue to attract new subscribers, helping strengthen our leadership.

第 8 號幻燈片顯示了我們寬帶業務的結果。吸引新客戶，同時將現有寬帶客戶遷移到更高速的服務仍然是我們的關鍵戰略和重點。雖然有線市場的競爭變得更加激烈，但我們相信，我們通過價格具有競爭力的光纖和 ADSL 連接提供的更高質量將繼續吸引新用戶，幫助加強我們的領導地位。

Broadband ARPU remained stable at TWD704 in the third quarter. We are also happy to see more subscribers signing up for higher speed connections, which would contribute to incremental ARPU growth over the long run.

第三季度寬帶 ARPU 穩定在 704 新台幣。我們也很高興看到更多用戶註冊更高速度的連接，從長遠來看，這將有助於 ARPU 的增量增長。

As of the end of September, subscribers signing up for 15 megabits per second connections reached 818,000. As more subscribers migrate to higher speed services, going forward, we expect Broadband ARPU will continue to grow moderately as well.

截至 9 月底，註冊 15 兆每秒連接的用戶達到 818,000 人。隨著越來越多的用戶轉向更高速的服務，我們預計寬帶 ARPU 也將繼續溫和增長。

Slide number 9. ARPU for MOD increased by over 8% to TWD147 in the third quarter, from TWD136 in the second quarter. This increase was attributable to the higher package subscriptions and advertising revenue during the London Olympic Games. We expect advertising revenue to more than double in the second half of 2012, as compared to the first half, based upon the strong [leadership] that advertisers experienced during the London Olympic Games.

第 9 張幻燈片。MOD 的 ARPU 從第二季度的 136 新台幣增加到第三季度的 147 新台幣。這一增長歸因於倫敦奧運會期間套餐訂閱和廣告收入的增加。基於廣告商在倫敦奧運會期間所經歷的強大[領導力]，我們預計 2012 年下半年的廣告收入將比上半年增加一倍以上。

In addition, we will continue to enhance the new platform's interactive capabilities and offer interactive programs, advertising and applications to subscribers in order to not only enhance users' overall enjoyment, but also to create new opportunities for advertisers.

此外，我們將繼續增強新平台的互動能力，為訂閱者提供互動節目、廣告和應用程序，不僅提高用戶的整體享受，也為廣告商創造新的機會。

On slide number 10, our ICT and the Cloud Computing businesses are growing in importance as revenue contributions for Chunghwa Telecom. As customer demand increases, we plan to [scale for it], and we are progressing our brand.

在第 10 張幻燈片中，我們的 ICT 和雲計算業務作為中華電信的收入貢獻越來越重要。隨著客戶需求的增加，我們計劃[擴大規模]，並且我們正在發展我們的品牌。

In addition to CaaS, SaaS and PaaS, we continue to offer innovative cloud services to our retail and corporate customers since 2009 by leveraging our past experience with many government projects. We've started offering ICT services to a wider variety of corporate and government customers.

除了 CaaS、SaaS 和 PaaS 之外，自 2009 年以來，我們還利用過去在許多政府項目中的經驗，繼續為零售和企業客戶提供創新的雲服務。我們已開始向更廣泛的企業和政府客戶提供 ICT 服務。

Current example projects include intelligent [strength] and monitoring systems for local governments, government taxation information systems, logistic management, and smart residential buildings.

目前的示例項目包括地方政府的智能[強度]和監控系統、政府稅務信息系統、物流管理和智能住宅建築。

Recently, we have won major contracts for projects such as motor vehicle registration and administration system, [government] cloud platform and many others. In addition, many of these major projects will allow us to continue generating stable revenue from ongoing maintenance services, once completed.

近期，我們獲得了機動車登記管理系統、【政務】雲平台等多個項目的重大合同。此外，其中許多重大項目一旦完成，將使我們能夠繼續從持續的維護服務中獲得穩定的收入。

We believe that more time will be needed to further stimulate user demand and trust for cloud services, but as demand slowly gains traction, and market acceptance, we will be well position to benefit directly with our wide range of services.

我們相信，還需要更多的時間來進一步刺激用戶對雲服務的需求和信任，但隨著需求慢慢增長和市場接受，我們將能夠從我們廣泛的服務中直接受益。

On slide number 12 for the regulatory update. As you are all aware, the Executive Yuan returned the draft for the Telecom Act Amendment to the NCC for reconsideration. We would like to see the amendment of Telecom Act to be considered as part of the digital convergence [regulation], along with the three broadcasting directive regulations in order to facilitate cross business operations. In doing so, we believe this would further provide the proper legal framework necessary to help further advance this [great] industry's future development as the media consumption habits in today's society continue rapidly evolving.

關於監管更新的第 12 號幻燈片。大家都知道，行政院已將電信法修正案草案退回國家通訊委員會復議。我們希望看到電信法修正案被視為數字融合[法規]的一部分，以及三項廣播指令法規，以促進跨業務運營。在此過程中，我們相信，隨著當今社會媒體消費習慣的不斷快速發展，這將進一步提供必要的適當法律框架，以幫助進一步推動這個[偉大的]行業的未來發展。

Additionally, the NCC announced a draft amendment for the Regulation Governing Network Interconnection among Telecom Enterprises in September this year, which is meant to create a standard practice for IP peering. Currently, in this new regulation's preliminary from, we would be required to provide free IP peering to other ISPs which meet certain requirements.

此外，NCC於今年9月公佈了《電信企業網絡互聯管理辦法》修正案草案，旨在為IP對等建立標準實踐。目前，在這項新法規的初步實施中，我們將被要求向滿足某些要求的其他 ISP 提供免費的 IP 對等互連。

In late September, we provided our opinions to the NCC suggesting that it revoked the [draft], because it does not conform to internationally accepted practices, which ultimately might we would be required to provide free IP peering to other ISPs which meet certain requirements.

9月下旬，我們向NCC提出了意見，建議其撤銷該[草案]，因為它不符合國際公認的做法，最終可能會要求我們向其他符合某些要求的ISP提供免費的IP對等互連。

In late September, we provided our opinions to the NCC suggesting that it revoked the draft, because it does not conform to internationally accepted practices which advocate light regulation and business negotiation among ISPs. As a matter of fact, we haven't seen any case in any market where a government authority has imposed such regulation on ISP -- IP peering.

9月下旬，我們向NCC提出意見，建議其撤銷該草案，因為它不符合國際通行的提倡互聯網服務提供商之間寬鬆監管和商業談判的做法。事實上，我們還沒有在任何市場上看到政府機構對 ISP——IP 對等互連實施此類監管的案例。

Now I would like to turn to Dr. Yeh for our financial overview.

現在我想請葉博士了解一下我們的財務概況。

Thank you, Chairman, and good day, everyone. Thanks for joining us today. I will review our financial result in detail, beginning with slide number 14.

謝謝主席，大家好。感謝您今天加入我們。我將從第 14 幻燈片開始詳細回顧我們的財務業績。

On slide number 14, are our income statement highlights. While total revenue for the third quarter was 2.1% (sic - see slide 14 "2.3%") lower year over year, operating cost and expenses reported a 1.1% increase year over year. As a result, income from operations and the net income decreased by 12.8% and 14.6% respectively.

第 14 幻燈片是我們損益表的重點內容。雖然第三季度總收入同比下降 2.1%（原文如此 - 參見幻燈片 14“2.3%”），但運營成本和支出同比增長 1.1%。受此影響，營業收入和淨利潤分別下降12.8%和14.6%。

Please refer to slide number 15 for our business segment revenues. While the Mobile VAS and the handset sales revenues from the Company's subsidiary, SENAO, continue their strong growth momentum during the quarter, total net revenue decrease. This decrease was primarily attributable to several declining factors, including Mobile Voice revenue attributable to Chunghwa's market competition, and the NCC's tariff reduction; revenue recognized under Domestic Fixed and the Internet segments from the government taxation information system project, which is near completion; domestic service revenue due to mobile substitution; as well as domestic long distance, broadband and ISP revenue due to tariff cuts.

有關我們業務部門的收入，請參閱幻燈片 15。儘管公司子公司SENAO的移動增值服務和手機銷售收入在本季度繼續保持強勁增長勢頭，但總淨收入卻有所下降。這一下降主要歸因於幾個下降因素，包括中華移動語音收入因市場競爭而下降，以及NCC的資費下調；即將完成的政府稅務信息系統項目在國內固定和互聯網部分確認的收入；移動替代帶來的國內服務收入；以及由於資費削減而帶來的國內長途、寬帶和 ISP 收入。

Slide number 16 shows the breakdown of operating costs and expenses. The operating costs and expenses increase in the third quarter was mainly from the cost of handsets sold from our subsidiary, SENAO, and the pension cost of TWD500 million due to an early retirement program offered during the third quarter. In line with our strategy, maintenance, material, rental and depreciation expenses increased in order to support our broadband and Mobile Internet service [fill out].

第 16 號幻燈片顯示了運營成本和費用的細目。第三季度營運成本及費用增加主要來自子公司神澳手機銷售成本，以及第三季度因提前退休計劃而產生的5億新台幣的養老金成本。根據我們的戰略，維護、材料、租賃和折舊費用增加，以支持我們的寬帶和移動互聯網服務[填寫]。

As shown on slide number 17, cash flow from operating activities decreased to TWD15.8 billion during the third quarter. This was mainly due to the decline in income from operations. We maintained a strong cash position with cash and cash equivalents amounting to TWD38.8 billion, as of September 30, this year.

如幻燈片 17 所示，第三季度經營活動現金流量減少至新台幣 158 億。這主要是由於營業收入下降所致。截至今年 9 月 30 日，我們保持強勁的現金狀況，現金及現金等價物達 388 億新台幣。

Meanwhile, the EBITDA margin decrease was primarily due to tariff cuts and higher handset sales from our subsidiary, SENAO, of which the EBITDA margin is relatively lower than our traditional telecom service. The EBITDA margin decrease for the parent Company was less than 1 percentage point.

與此同時，EBITDA 利潤率下降主要是由於關稅下調和我們的子公司 SENAO 手機銷量增加，其 EBITDA 利潤率相對低於我們的傳統電信服務。母公司EBITDA利潤率下降幅度不到1個百分點。

Slide number 18 show our 2012 unconsolidated forecast, and the results of our third quarter this year operations. Although we continue to experience regulatory pressure and market competition, we are pleased that our results for the first nine months of this year were in line with our earlier guidance.

第 18 張幻燈片顯示了我們 2012 年的未合併預測以及今年第三季度的運營結果。儘管我們繼續面臨監管壓力和市場競爭，但我們很高興今年前九個月的業績符合我們之前的指引。

With the changing telecom landscape, and the fierce market competition, we will continue to focus on stabilizing our business, and we will maintain our full-year guidance, which has been factored in the impact of iPhone 5. However, the EBITDA margin may be slightly lower because we revised up the estimated handset sales in the fourth quarter.

隨著電信格局的變化和激烈的市場競爭，我們將繼續專注於穩定業務，我們將維持全年指引，該指引已計入 iPhone 5 的影響。然而，EBITDA 利潤率可能會下降。略有下降是因為我們上調了第四季度手機銷量的預期。

As stated in our earlier guidance, we moderately increased our capital expenditure budget for 2012 with a focus on fixed and mobile broadband constructions. The execution rate for the first nine months is 68%. We expect the year-end execution rate will reach more than 90%, which is higher than that of last year.

正如我們之前的指引所述，我們適度增加了2012年的資本支出預算，重點關注固定和移動寬帶建設。前9個月的執行率為68%。我們預計年終執行率將達到90%以上，高於去年。

With increased CapEx devoted to the aforementioned two areas, we definitely improved our customer experience and satisfaction. And we will further facilitate customer migration to high speed fiber solutions, and enhance the quality of our mobile network. We will review our CapEx budget and execution on a regular basis, focusing on making the most cost effective spending decision possible.

通過增加用於上述兩個領域的資本支出，我們確實改善了客戶體驗和滿意度。我們將進一步促進客戶向高速光纖解決方案遷移，並提高我們的移動網絡質量。我們將定期審查我們的資本支出預算和執行情況，重點是盡可能做出最具成本效益的支出決策。

Lastly, recently our property subsidiary, Light era, acquired land from a private party in Taoyuan, which is located near a high speed rail station. This property will be used to develop smart residential buildings. We will plan to deploy state of the art technologies and services, including fiber broadband, ICT services energy saving technology and remote surveillance service technology to these properties.

最後，最近我們的地產子公司光時代從一家私人手中收購了桃園的土地，該土地位於高鐵站附近。該物業將用於開發智能住宅樓。我們將計劃在這些物業部署最先進的技術和服務，包括光纖寬帶、ICT服務節能技術和遠程監控服務技術。

Thank you for your attention, and now we would like to open up for questions.

感謝您的關注，現在我們願意提出問題。

We will now begin our question and answer session. (Operator Instructions). Chate Benchavitvilai, Credit Suisse.

我們現在開始問答環節。 （操作員說明）。 Chate Benchavitvilai，瑞士信貸。

I have in total three major questions. The first one is related to your broadband and IPTV subscriber target for the year. I understand that, looking at you full year and the run rate over the past nine months, it seems like you are expecting a significant increase in net additions for both broadband and IPTV subscribers into the fourth quarter. Would you be able to elaborate for us how would you be able to achieve that? What would drive an acceleration in net adds in the fourth quarter?

我總共有三個主要問題。第一個與您今年的寬帶和 IPTV 用戶目標有關。據我所知，從全年情況和過去九個月的運行率來看，您似乎預計第四季度寬帶和 IPTV 用戶的淨增量將大幅增長。您能為我們詳細說明一下您將如何實現這一目標嗎？是什麼推動了第四季度淨增量的加速？

The second question is related to the IPTV revenues. What is your IPTV revenue contribution right now, and how much of that is coming from advertising?

第二個問題與IPTV收入有關。目前您的 IPTV 收入貢獻是多少？其中有多少來自廣告？

And the third question is related to the CapEx budget. I understand that it's still very early right now, but would you be able to provide some color on how your CapEx budget for FY '13 might look like, compared to this year? Thank you very much.

第三個問題與資本支出預算有關。我知道現在還為時過早，但您能否提供一些有關 13 財年資本支出預算與今年相比的情況的信息？非常感謝。

The target number of customers on our IPTV, we have revised during the previous conference call. Our net adds for this year, towards the end of the year, would be 250,000 instead of 0.5 million we projected earlier.

我們在上次電話會議中修改了 IPTV 的目標客戶數量。今年年底，我們的淨新增人數將達到 25 萬，而不是我們之前預測的 50 萬。

And we will continue our marketing and sales on our MOD services. As the survey indicated, we reported earlier that the quality and the variety of our IPTV service is very well received during this summer. So we would promote our MOD service further the remaining of this year.

我們將繼續對 MOD 服務進行營銷和銷售。正如調查顯示的那樣，我們早些時候報告說，我們的 IPTV 服務的質量和多樣性在今年夏天非常受歡迎。因此，我們將在今年剩餘時間內進一步推廣我們的 MOD 服務。

The IPTV revenue is still low, but we indicated the ARPU from IPTV so you can calculate the amount of revenue we generate from IPTV service.

IPTV收入仍然很低，但我們指出了IPTV的ARPU，因此您可以計算我們從IPTV服務中產生的收入金額。

Our CapEx for next year, we are still in preparation for next year's business spend, so it's not final yet. I believe our CapEx for next year probably will be in line with our projection this year, or slightly higher because we like to expedite rollout of fiber solutions, and also extend or improve the quality of our broadband, mobile broadband network.

我們明年的資本支出，我們仍在為明年的業務支出做準備，所以還不是最終的。我相信我們明年的資本支出可能會與我們今年的預測一致，或者略高一些，因為我們希望加快光纖解決方案的推出，並擴展或提高我們寬帶、移動寬帶網絡的質量。

Thank you very much. Just a follow-up question; two follow-up questions. The first question is related to your broadband subscriber target; I understand that you are targeting [47,000, 48,000] of subscribers for broadband by the end of the year. That would imply, I understand, around 180,000 net additions in the fourth quarter, compared to around 12,000 to [30,000], you have add per quarter, year to date. So is there any specific marketing campaign, or effort on the broadband side, that might drive up the subscriber pick up in the fourth quarter that you can share?

非常感謝。只是一個後續問題；兩個後續問題。第一個問題與您的寬帶用戶目標有關；據我了解，您的目標是到今年年底寬帶用戶達到 [47,000, 48,000]。據我了解，這意味著第四季度淨新增人數約為 180,000 人，而年初至今每季度淨新增人數約為 12,000 至 [30,000] 人。那麼，是否有任何具體的營銷活動或寬帶方面的努力可以推動第四季度用戶數量的增長，您可以分享一下嗎？

And the second follow-up is on the IPTV revenue. What's the percentage of IPTV revenues, coming from advertizing right now? Thank you very much.

第二個後續是IPTV收入。目前來自廣告的 IPTV 收入百分比是多少？非常感謝。

I think for the IPTV advertizing revenue is small, but it's improving. So we were working on it, to make it bigger, okay. But we think that we are pleased to see the improvement.

我認為IPTV的廣告收入雖然很小，但正在改善。所以我們正在努力，讓它變得更大，好吧。但我們認為我們很高興看到這種改善。

And on the broadband subscriber target?

那麼寬帶用戶目標呢？

For the broadband subscribers, again, our fiber solution is very well received in the market. And we will have new promotional packages, hopefully, in this quarter, and we --

對於寬帶用戶來說，我們的光纖解決方案再次在市場上廣受好評。我們希望在本季度推出新的促銷套餐，而且我們——

Also, from the surveys, we have seen conducted by third party, we would like to work harder to attract more customers.

另外，從第三方進行的調查中我們看到，我們希望更加努力地吸引更多客戶。

Noted, and thank you very much.

注意到了，非常感謝。

Steven Liu, Standard Chartered Bank.

史蒂文·劉，渣打銀行。

Thank you, I have two questions. One is regarding the smartphone average monthly data usage. You top tier, mid tier, and the lower tier, what is the average monthly data usage in smartphone users?

謝謝，我有兩個問題。一是關於智能手機平均每月數據使用量。頂層、中層和底層，智能手機用戶的平均每月數據使用量是多少？

Regarding the usage, the top tier subscribers, the monthly usage is around 2.1 gigabyte, okay. And mid range, about --

關於使用量，頂級訂閱者每月的使用量約為 2.1 GB 左右，好吧。中檔，大約——

I think, about the usage of the smartphone users, I would say that less than 1 gigabyte usage. I think the average usage is increasing from 1.60 gigabyte to 1.7 gigabyte, or 1.8 gigabyte, about that range.

我認為，關於智能手機用戶的使用情況，我想說的是少於 1 GB 的使用量。我認為平均使用量正在從 1.60 GB 增加到 1.7 GB 或 1.8 GB，大約在這個範圍內。

The mid range usage is about 271 megabytes, and the lower tier is about 56 megabytes.

中層使用量約為 271 兆字節，下層使用量約為 56 兆字節。

How about ARPU, top tier, mid tier, lower tier, smartphone ARPU?

ARPU、頂級、中端、低端、智能手機 ARPU 怎麼樣？

Yes ARPU for the high tier, every tier is about TWD1,400, slightly higher than TWD1,000 -- TWD1,400, okay. And for the mid tier, ARPU is better than TWD885 okay? And the low tier is about TWD720.

是的，高段位的ARPU，每段大約是TWD1,400，比TWD1,000略高--TWD1,400，好吧。對於中端來說，ARPU 比 TWD885 更好好嗎？低檔的大約是TWD720。

Okay. Can I query please, low tier usage, monthly usage, 500 megabyte?

好的。我可以查詢一下，低等級使用量，每月使用量，500兆字節嗎？

May I interrupt? When we're talking ARPU, for the low, mid and high tier smartphone users, usually we don't really give this kind of data. The data we offering is for the smartphone; if you actually refer to our presentation that's on page 7.

我可以打斷一下嗎？當我們談論 ARPU 時，對於低、中、高端智能手機用戶，通常我們不會真正提供此類數據。我們提供的數據適用於智能手機；如果您確實參考了我們第 7 頁的演示文稿。

Here usually our -- you can see on the bottom left the chart we refer. The smartphone ARPU for the third quarter is around TWD1,231. So we don't really offer any breakdowns for individual [ARPUs for that].

通常，您可以在左下角看到我們引用的圖表。第三季度智能手機 ARPU 約為新台幣 1,231 元。因此，我們實際上並沒有提供任何針對個人 [ARPU] 的細分。

Could you repeat the low tier data usage, low tier? It's 400 at least.

您能否重複一下低層數據使用情況，低層？至少也有400吧

That includes the low -- we do have customer -- more than 50% of customer of our smartphone user, the amount of usage, for data volume is less than 1 gigabyte. That's the information we provide, okay [n the ARPU].

這包括低——我們確實有客戶——超過 50% 的客戶是我們智能手機用戶的使用量，數據量小於 1 GB。這就是我們提供的信息，好吧 [n ARPU]。

And about the [property] business, could you give some figure about the investment amount of the coming few years, context-wise in properties?

關於[房地產]業務，您能否給出一些有關未來幾年房地產投資金額的數字？

The property investment usually, we give information about this specific one from our subsidiary, property subsidiary, that's the specific one. We don't have the number for the CapEx for the property investments. Usually, this is related to our IDC kind of building.

房地產投資通常，我們從我們的子公司，房地產子公司，提供有關這一具體信息的信息，這就是具體的信息。我們沒有房地產投資資本支出的數字。通常，這與我們IDC類型的建築有關。

And lastly, about the 3G utilization, what's the average utilization of the 3G network?

最後，關於3G利用率，3G網絡的平均利用率是多少？

Well, all 3G network, the capacity average is more than enough for the customers' [load], traffic load. So only in certain selected areas, where traffic is concentrated, we encounter some contractions during peak hours.

那麼，全3G網絡，平均容量對於客戶的[負載]、流量負載來說是綽綽有餘的。因此，只有在某些交通集中的選定區域，我們才會在高峰時段遇到一些收縮情況。

Okay, thank you.

好的謝謝。

Joseph Quinn, Macquarie.

約瑟夫·奎恩，麥格理。

Firstly, just going back on the property angle; I find it a little bit strange, there seems to be a bit of a different strategy that you have taken in the past. You have usually developed your own property landbanks; you haven't really purchased property before to develop it.

首先，回到財產角度；我覺得有點奇怪，你們過去採取的策略似乎有點不同。您通常已經開發了自己的地產土地儲備；您之前並沒有真正購買過房產來進行開發。

So I'm just wondering, could you provide me with a bit of thought behind management thinking on the change in strategy? And also, are you planning to sell these properties? Or again, this would be different from the past where you tend to develop and rent the property.

所以我只是想知道，你能為我提供一些關於管理層對戰略變革的思考背後的想法嗎？另外，您打算出售這些房產嗎？或者，這與過去您傾向於開發和租賃房產的情況不同。

The second question is on your Broadband side; some of my other colleagues have highlighted that it does seem it's a bit difficult to grow the top line number for broadband users. Can you maybe elaborate in terms of where you think maybe the full potential market is? Are we ready at saturation point, and any new users, do you need to gain them from your competitors, such as the cable providers? That's the second question.

第二個問題是關於您的寬帶方面的；我的其他一些同事強調，增加寬帶用戶的頂線數量似乎確實有點困難。您能否詳細說明一下您認為完整的潛在市場在哪裡？我們是否已經準備好達到飽和點？對於任何新用戶，您是否需要從競爭對手（例如有線電視提供商）那裡獲得它們？這是第二個問題。

And just thirdly is on the IP peering side. Obviously, in your presentation, you did highlight the IP peering issue, but can you maybe provide some numbers around that, in terms of how large the revenue impact that would be to your business? And if that was the case, would you have to provide free IP peering? Thank you.

第三是 IP 對等端。顯然，在您的演示中，您確實強調了 IP 對等互連問題，但您能否提供一些相關數據，說明這對您的業務的收入影響有多大？如果是這樣的話，您是否必須提供免費的 IP 對等互連？謝謝。

Okay, the property subsidiary, Light era, will continue play important role in our real estate development and rental service. And so Light era will continue to build and maintain its capability. So it leaves some room for growth, in this business. So to attract capable people in the business, we have to find land for them to build. So the land we just purchased, would be, as I indicated earlier, would be used to build for some ICT related buildings.

好的，房地產子公司光時代將繼續在我們的房地產開發和租賃服務中發揮重要作用。因此，光時代將繼續構建和維護其能力。因此，它為這項業務留下了一些增長空間。因此，要吸引有能力的人才進入這個行業，我們就必須為他們找到土地來建設。因此，正如我之前指出的，我們剛剛購買的土地將用於建造一些與信息通信技術相關的建築物。

And we will sell those buildings. And we might find partners in building this land, because in the past the Light era has contributed to our profit in the -- for example, in 2011 it had a net income of TWD1.2 billion. And this year, so far, and for the first three quarters, its net income is TWD0.52 billion. So we think this business is on track and we hope they will continue to help the parent company to develop our land, our real estate. Thank you.

我們將出售這些建築物。我們可能會找到合作夥伴來建設這塊土地，因為過去光時代為我們帶來了利潤——例如2011年它的淨利潤為新台幣12億。而今年到目前為止，以及前三季度，其淨利潤為新台幣5.2億。因此，我們認為這項業務正在步入正軌，我們希望他們能夠繼續幫助母公司開發我們的土地和房地產。謝謝。

Can I just follow-up on the property side? So it could be something in the future that we continue to see some form of property purchasing [if] Light era wants to continue to expand. But can I also just get a maybe -- do you have a timeframe when you expect maybe these projects to start to begin to be developed or become for sale, actually you'll see some impact on Chunghwa's actual income? Thank you.

我可以只跟進物業方面嗎？因此，如果光時代想要繼續擴張，未來我們可能會繼續看到某種形式的房產購買。但我也可以問一下，您是否有一個時間表，您預計這些項目可能會開始開發或出售，實際上您會看到對中華實際收入的一些影響？謝謝。

Okay. I think this land is kind of a big piece of land, so we would work on it for a while, and we have some plan to build, but we don't disclose the detail yet. Okay, thank you.

好的。我認為這塊土地是一塊很大的土地，所以我們會在它上面工作一段時間，我們有一些建設計劃，但我們還沒有透露細節。好的謝謝。

On your second question about broadband market potential, let me share with you that Chunghwa Telecom will still maintain nearly 80% of market share in broadband. And the net increase in number of subscribers of Chunghwa Telecom is still better than majority; we have over 60% of the market share for the net adds in broadband.

關於第二個問題，關於寬帶市場潛力，我跟大家分享一下，中華電信在寬帶方面仍將保持近80%的市場份額。而中華電信的用戶淨增率仍好於多數；我們擁有超過 60% 的寬帶網絡附加市場份額。

The broadband market will develop if the digital convergence strategy is clearly taking place. That's why we encourage the government when they want to revise Telecom Acts or related regulations; we emphasize and focus on development of digital convergence, it's very important. So as everything gets more ready, we believe the potential is still there.

如果數字融合戰略明確實施，寬帶市場將會發展。這就是為什麼我們鼓勵政府修改電信法或相關法規；我們強調並重點發展數字融合，這非常重要。因此，隨著一切準備就緒，我們相信潛力仍然存在。

On the third question about IP peering, well, the amount of revenue in IP peering is not really very significant. But we believe the issue here is not the revenue, it's the environment that we are fostering for the IP industry, for IP Internet services. We really do not believe it's the right thing to do to offer, without any conditions, free period.

關於IP對等的第三個問題，IP對等的收入並不是非常可觀。但我們認為，這裡的問題不是收入，而是我們正在為 IP 行業、IP 互聯網服務培育的環境。我們真的不認為無條件提供免費期是正確的做法。

Thank you, that's very helpful. Now I'm just wondering, is your -- President Li, is he there today also?

謝謝，這非常有幫助。現在我只是想知道，您的李總今天也在嗎？

Well, probably you are aware that NCC is conducting interview with the three major mobile operators on extension of 2G licenses. So our President, he lead the team to NCC to participate in this interview, so he's not [present today].

嗯，你可能知道NCC正在就2G牌照延期問題與三大移動運營商進行約談。所以我們的總統，他帶隊去NCC參加這次採訪，所以他[今天]沒有出席。

Understood, thank you.

明白了，謝謝。

(Operator Instructions). Gary Yu, Morgan Stanley.

（操作員說明）。加里·餘，摩根士丹利。

I understand that you have a 20% discount for unlimited data users whose monthly data usage is below 1GB. Can I know how many of your smartphone users are enjoying this discount and do you still plan to remove this promotion by the end of this year? Thank you.

據我了解，對於每月數據使用量低於 1GB 的無限數據用戶，您可以享受 20% 的折扣。我能否知道您有多少智能手機用戶正在享受此折扣？您是否仍計劃在今年年底前取消此促銷活動？謝謝。

We don't provide this information.

我們不提供此信息。

Okay, that's fine. Thank you.

好吧，沒關係。謝謝。

Sydney Zhang, BofA Merrill Lynch.

悉尼·張，美銀美林。

I actually have a similar question to the last one. My question is really just for this 20% discount sorry, going to -- planning to cancel this or withdraw this 20% discount any time soon? That's one question.

其實我也有和上一個類似的問題。我的問題實際上只是針對這個 20% 折扣，抱歉，打算 - 計劃很快取消這個或撤回這個 20% 折扣嗎？這是一個問題。

The other question I have is, you mentioned that on the regulation side that NCC is drafting the next rounds of the tariff reduction plan. Can you share a little bit more on how that tariff reduction plan is going to look like? Thanks.

我的另一個問題是，你提到監管方面NCC正在起草下一輪關稅削減計劃。您能否更多地分享一下關稅削減計劃的具體情況？謝謝。

Okay, the first one, the 20% discount end December of this year, and we don't have the detail about these new tariff reduction plans. Thank you.

好的，第一個，今年 12 月底的 20% 折扣，我們沒有這些新關稅削減計劃的詳細信息。謝謝。

Okay, thanks.

好的謝謝。

Piyush Mubayi, Goldman Sachs & Co.

Piyush Mubayi，高盛公司

I've got two questions; the first is about slide 25 where you've given us the detail for your fiber rollout. Thank you very much for this detail; this is wonderful. Could you just expand so I can better understand the difference between the coverage that entails 100 megabytes plus service and the coverage that ends 50 megabyte plus service, what exactly it is, is it that makes or allows you to get from 25% coverage in 2011 to 70% coverage in 2012?

我有兩個問題；第一張是關於幻燈片 25，您在其中向我們提供了光纖部署的詳細信息。非常感謝您提供這個細節；這太棒了。您能否擴展一下，以便我可以更好地理解需要 100 兆字節以上服務的覆蓋範圍與結束 50 兆字節以上服務的覆蓋範圍之間的差異，它到底是什麼，是否使您能夠在 2011 年獲得 25% 的覆蓋範圍2012 年覆蓋率達到 70%？

And then looking ahead, given that you get to 70% by 2012, and I know you talked about CapEx potentially being higher for potentially one more year, but thereafter when you look at 2014 onwards, what sort of CapEx on the fixed line should we -- I know this is two years out, but what sort of CapEx should we be putting our models?

然後展望未來，考慮到到 2012 年您將達到 70%，而且我知道您談到資本支出可能會在一年內更高，但此後當您考慮 2014 年以後，我們應該在固定線路上採用什麼樣的資本支出——我知道這已經是兩年後的事了，但是我們應該採用什麼樣的資本支出來建立我們的模型？

And the second area of question is, just if you could remind us what your dividend plan is? Thank you so much.

第二個問題是，您能否提醒我們您的股息計劃是什麼？太感謝了。

Okay, I'm going to answer your first question because now we are, for the 100 megabyte we have changed our reservation basis so that the definition of coverage has changed. And so that is part of the reason the increase of around 24.6% to 70%. And we are working on how to modify and to let you know the definition soon, but not at this presentation. We are still clarifying some of the issues there. Thank you.

好的，我要回答你的第一個問題，因為現在我們已經改變了 100 兆字節的預留基礎，因此覆蓋範圍的定義也發生了變化。這就是增長約 24.6% 至 70% 的部分原因。我們正在研究如何修改並儘快讓您了解該定義，但不是在本次演示中。我們仍在澄清其中的一些問題。謝謝。

Okay. And would you -- I know you talked about potentially higher CapEx in 2013, but based on how much fiber coverage you have by the end of 2013, should we expect the CapEx to dramatically fall in 2014/'15 onwards?

好的。我知道您在 2013 年談到了可能更高的資本支出，但是根據 2013 年底您的光纖覆蓋範圍，我們是否應該預期資本支出在 2014 年/'15 年之後會大幅下降？

We will provide our guidance maybe early February, but so far, as I mentioned earlier, because we are continuing building up our broadband fixed net and the mobile broadband, and our customer are pleased with what we offer, so we have to continue our effort to secure our customers. Thank you.

我們可能會在二月初提供我們的指導，但到目前為止，正如我之前提到的，因為我們正在繼續建設我們的寬帶固定網絡和移動寬帶，而且我們的客戶對我們提供的服務感到滿意，所以我們必須繼續努力確保我們的客戶安全。謝謝。

And in terms of dividend plan, we don't have the detail yet, but so far, you can see in the past, we maintain 90% dividend payout ratio, and I think that will give you some indication. But it's up to the Board to decide.

在股息計劃方面，我們還沒有細節，但到目前為止，你可以看到過去我們保持90%的股息支付率，我認為這會給你一些指示。但這由董事會決定。

And in terms of special dividend or the return of capital, as we explained many times earlier, because now CapEx amount is higher than depreciation expenses, so we don't have the source for those extra dividends. So that is our current situation. Thank you.

在特別股息或資本回報方面，正如我們之前多次解釋的那樣，因為現在資本支出金額高於折舊費用，所以我們沒有這些額外股息的來源。這就是我們目前的情況。謝謝。

Thank you very much.

非常感謝。

Yes, may I add one point about the 100 megabyte fiber coverage? Even though we redefine the 100 megabyte, the coverage, we still need some additional CapEx for the fiber rollout, for the high speed. It's just the redefinition can save some of the CapEx, just for your information.

是的，我可以補充一點關於百兆光纖覆蓋嗎？即使我們重新定義了 100 兆字節的覆蓋範圍，我們仍然需要一些額外的資本支出來進行光纖部署，以實現高速。只是重新定義可以節省一些資本支出，僅供參考。

Thank you.

謝謝。

(Operator Instructions). Joseph Quinn, Macquarie.

（操作員說明）。約瑟夫·奎恩，麥格理。

Can I just follow up one item on your CapEx side? As I understand, you're not giving out any particular numbers for 2013, but it does seem that your President made a comment that you will be building a new datacenter in [Changzhou]. I believe there may be a cost of about TWD13 billion to TWD15 billion for that project.

我可以只跟進你們資本支出方面的一項嗎？據我了解，你們沒有給出 2013 年的任何具體數字，但你們的總統似乎確實發表了評論，你們將在[常州]建設一個新的數據中心。我相信該項目的成本可能約為新台幣130億至150億。

Could you maybe give some detail on the timeframe for that expenditure; how much maybe you expect to see in 2013, going forward, because obviously, I would assume that will have some impact on your CapEx number for next year? Thanks.

您能否提供有關該支出的時間表的一些詳細信息？展望未來，您預計在 2013 年會看到多少，因為顯然，我認為這會對您明年的資本支出數字產生一些影響？謝謝。

I think we will start to build the Changzhou project, but in the beginning, the scale is limited. Thank you.

我想我們會開始建設常州項目，但一開始規模有限。謝謝。

Okay. So there should be relatively minor impact at the beginning?

好的。那麼一開始影響應該比較小吧？

Yes, for year 2013, yes, yes.

是的，2013 年，是的，是的。

Okay. Thank you.

好的。謝謝。

(Operator Instructions). There are currently no more questions. I will turn it back over to Chairman Lu. Please begin.

（操作員說明）。目前沒有更多問題。我會把它轉回給盧主席。請開始。

Okay. Thank you very much for participating in our conference call for our third quarter 2012 results call. Thank you very much. Goodnight from Taipei.

好的。非常感謝您參加我們 2012 年第三季度業績電話會議。非常感謝。來自台北的晚安。

Thank you, Chairman Lu. Thank you, all, for your participation in Chunghwa Telecom's conference call. There will be a webcast replay within an hour. Please visit www.cht.com.taiwan/ir under the In Focus section. You may now disconnect. Goodbye.

謝謝盧主席。感謝大家參加中華電信電話會議。一小時內將進行網絡廣播重播。請訪問 www.cht.com.taiwan/ir 的“焦點”部分。您現在可以斷開連接。再見。