Taiwan Telecoms Industry Report 2023: Market is Set to See a Wave of Consolidations this Year
DUBLIN, March 2, 2023 /PRNewswire/ -- The "Taiwan Telecoms Industry Report - 2023-2030" report has been added to ResearchAndMarkets.com's offering.
The Taiwanese telecoms market is set to see a wave of consolidation in 2023
By the end of the year, the number of mobile operators could decline from five to three, which is considered a reasonable number for market competition globally. Two of the three major players are set to acquire two smaller companies.
Taiwan Mobile is set to merge with Taiwan Star, and FET will take over Asia Pacific Telecom, a smaller operator. Both deals are expected to conclude by late 2023, reflecting a trend of consolidation by private players that we have witnessed in other Asian markets such as Malaysia, Thailand and Indonesia.
Further market consolidation is likely to occur over the forecast period as many telecom players confront the task of creating returns in a growing and capital-intensive industry and are therefore considering ways to grow industry revenues and profitability.
The publisher forecasts that mobile subscriptions will continue to grow in the 2023-30 period and fixed broadband subscribers will also continue to grow but lower its household penetration over the same period due to fixed-wireless substitution. The ratio of the telecommunications sector revenue to GDP is declining from a peak in 2015, sliding down every year since then.
Following the market contraction over the last 5 years, the publisher forecasts flat revenue growth to 2030, as long as data pricing stays rational amid the mergers from five to three mobile operators due in 2023.
Mobile subscriptions are growing faster than mobile service revenue leading to ARPU decline after 3 years of intense competition with the market transitioned completely transitioned to 4G after shutting down 2G and 3G networks in 2017 and 2019 respectively.
The publisher expects the overall telecoms market to remain flat through to 2025 after a marked decline from 2016 due to mobile service revenue pressure partially offset by fixed broadband and enterprise data growth.
Capex Investments
The Capex to GDP ratio peaked in 2014 and has been sliding since, to its lowest in 2019 and rising again in 2020. Capex investments will increase again from 2023 through to 2030, as mobile operators invest in 5G, bolster their 4G coverage and increase capacity to fulfil strong data demand, increasing again Capex to Sales Ratio.
Operator Profiles
Most operators maintained EBITDA margins at the expense of revenue growth with Chunghwa losing the most share while Far EasTone and Taiwan Mobile also losing mobile service revenue share in the 2016-2022 period at the expense of Asia Pacific Telecom and Taiwan Star.
Mobile Subscribers and Revenue
As the rate of growth of net additions in mobile subscriptions slows, telecommunications providers are channelling their efforts into reducing their cost base and stabilising ARPU through new value-added services using mobile data and bundling fixed and mobile services. The proportion of postpaid subscriptions remained stable at about 81% between 2016 and 2022 while the postpaid segment is growing in popularity with SIM-only offerings and reducing the number of people holding multiple SIMs.
According to our benchmark study of mobile data pricing, India has the lowest rate per GB at just a few cents per GB, while Australia and China had the biggest cost reduction per GB mostly due to increased data allowance in plans while Singapore remains expensive. Taiwan mobile users pay for competitively priced data as mobile users recorded the largest monthly download in the Asia Pacific region.
Broadband Subscribers - FTTH Push and Fixed Wireless
The fixed broadband market is experiencing a subdued growth with Chunghwa Telecom losing share to HFC cable operators such as KBro, Taiwan Mobile, TBC and CNS. Chunghwa Telecom invested early in the 2010s in FTTx technologies while migrating its DSL subscribers to its HiNet network. Competing cable operators also invested in upgrading their cable networks bundling mobile, IPTV and e-Commerce services but falling short of upgrading to full-fibre networks limiting opportunities for gigabit speeds.
Fixed broadband penetration is forecasted to decline as fixed-wireless substitution is increasing supporting a rising number of lone-occupancy households.
Thematics - Telecoms Infrastructure/5G/M&A/Infrastructure
Infrastructure funds, pension funds and government funds are assigning high valuation multiples to telecommunications infrastructure assets such as mobile towers, data centres, submarine cable and fibre infrastructure.
Investment funds are assigning high valuation multiples to telecommunications infrastructure assets such as mobile towers, data centres, submarine cable and fibre infrastructure. This report outlines some real market examples of how investors view and value these investments with real industry examples and EV/EBITDA comparatives and benchmarks.
However, in the medium term, the telco sector is likely to experience some corporate activity. Subdued growth due to ARPU pressure compounded by low population growth is pushing telcos to look for outside opportunities to increase scale. The publisher expects a wave of consolidation in Taiwan in both the mobile and fixed broadband market, after some failed merger of cable operators.
The arrival of 4G moved the Internet off our desktops into our palms and pockets, 5G could transform the network from something we carry around to something taking us around either virtually (augmented reality or virtual reality) or in reality (autonomous vehicles), the 5G outcome and benefits beyond fast connectivity remain largely unknown in terms of business models, investments required and timeline.
This report provides analyses of revenue and market forecasts as well as statistics of the Taiwan telecoms industry including market sizing, 5-year forecasts, market insights, key telecom trends, 5G and also features the following:
- Overall Telecommunications Market by Major Operators
- Telco Operators Profile, Revenue and EBITDA Mix
- Mobile Subscribers & Revenue Market Overview and Forecasts
- Spectrum Holdings
- IoT Market Overview
- Broadband Subscribers & Revenue Market Overview and Forecasts
- National Broadband Network Detailed Market Overview and Forecasts
- Thematics/Opportunities relating to 5G, M&A and e-Commerce
- Telecoms Infrastructure Review
- Telco M&A Transaction Database
Why You Should Buy the Taiwan Industry Telecoms Report:
- Benefit from the latest market opportunities
- Understand the threats to your operations and investments and protect your company against future risks
- Gain insights on emerging trends supporting, enhancing or disrupting your activities in the market
- Get a full view of the competitive landscape to assess your market position.
- Forecasts as a key input for successful budgeting and strategic business planning in the telecoms market
- Target business opportunities and risks in the telecoms sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments
- Assess the activities, strategy and market position of your competitors, partners and clients via our Operators Profiles
- The Taiwan Telecommunications Industry Report, 2023-2030 includes a comprehensive review of the Taiwanese market dynamics, market sizing, market forecasts, analysis, insights and key trends.
Thematics/Opportunities
- Consolidation Opportunities
- Diversification Opportunities
- e-Commerce
- Digital Payments
- New Telecoms Operating Model
- The Attraction of Infrastructure Multiples
- 5G Developments
- 5G Overview
- 5G - Relative Capex Investments and Frequency Range
- 5G OpenRAN
- Beyond 5G and Towards 6G
Companies Mentioned
- Asia Pacific Telecom (APT)
- China Network Systems (CNS)
- Chunghwa Telecom
- Far EasTone
- Kbro
- National Communications Commission (NCC)
- Taiwan Broadband Communications (TBC)
- Taiwan Mobile
- Taiwan Star (T Star)
For more information about this report visit https://www.researchandmarkets.com/r/8fn72z-telecoms?w=5
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