Telecommunications services market in Taiwan is gradually opened up, telecom businesses proposed user-friendly plans and diversified services in order to attract customers. Advertisements of ‘No Contracts Campaign’ are posted on social networking sites in recent weeks. It is actually an advertisement with the format of a petition, which strives for “Telecommunications Liberation” and “Contracts Abolition”. It is getting increasing signatures.
However, a mass of people failed to understand the definition and content of ‘No Contracts Campaign’. The campaign was launched by Circles.Life, a Type II Telecom enterprise in Singapore, in order to pave the way for the Taiwan telecom market in June, the term ‘Type II Telecom’ has also drawn more attention.
What is Type II Telecom?
The telecommunications industry is divided into ‘Type I Telecom’ and ‘Type II Telecom’. Type I Telecom enterprises are given the franchises and are requested to build their own base station and create their own network, while Type II Telecom enterprises are given licenses and provide their services by leasing networks of Type I Telecom enterprises. For instances, Type I Telecom companies include Chunghwa Telecom, FarEasTone, Taiwan Mobile, Asia Pacific Telecom and Taiwan Star Telecom; while Type II Telecom companies include 7-net and Circles.Life, which operate their business by hiring networks from Type I Telecom.
High standard of entry to Type I telecom are set as they need to invest a large amount of money in building infrastructures, including base stations and networks, in which the capital required is not affordable for every company, but Type II telecoms own less capital. It is also the main reason to have Type I and Type II Telecom.
In addition, either Type I Telecom or Type II Telecom rely on limited spectral resources. Spectral resource refers to the radio waves in specific areas and is like the platform of disseminating messages. Messages are delivered on the communication methods through broadcast, telephone and WIFI with spectral resources. Messages in different forms are communicated by using different frequencies of radio waves. The radio spectrum is the wave with frequencies from 30 Hertz to 300 GHz.
In fact, a little amount of radio spectrum is distributed to telecom companies due to the limited sources which also need to be used in national security, air industry and also disaster relief. Once the enterprise fails to get more spectrum, network congestion will easily happen. Countries worldwide have an upper control limit over the spectrum owned. Type I telecom business with higher capital are allowed to bid for spectrum in limited amount in order to build their base station and networks, while Type II telecom industry is only allowed to lease networks from Type I telecom, but not bid the spectrum.
National Communications Commission recorded 388 Type II telecom business in April 2019, but they did not gain as much attention as this telecom business from Singapore. Will the marketing strategy of a brand-new Type II telecom business attract customers? Time will tell.