Abstract
The number of cellular phone subscribers has reached a total of 5.6 million in Taiwan (NCC, 2007). Meanwhile, Internet users have reached a total of 14.5 million and mobile Internet users have broken the record of 9.1 million in 2006 (NCC, 2007). The combination of information and telecommunication technologies has brought people a new communication method—cellular value-added services, which have become a lucrative business for telecommunication providers in Taiwan. One result of the cellular value-added services presented to the public brought the information-based, messaging-based, and financial services into one kit; people can not only communicate through the cellular phones but also use them as versatile handsets. Do- CoMo, a famous Japanese telecommunication provider, has successfully cultivated the cellular value-added services. Its success can be explained with two reasons: one is content, and Web site providers are willing to share their technical support; and the other reason is the establishment of an automated payment system to assist the cash flow between providers and even beef up the whole industry by associating related business partners (Natsuno, 2001). Comparing with DoCoMo’s case, the telecommunication service providers in Taiwan have provided various cellular value-added services. However, the popularity of the service does not turn out to be as good as expected. We are wondering why. Telecommunication providers began to adjust the fee of short message service (SMS) down to 25% maximally since June 2004 in Taiwan. The idea of lowering fees is to stimulate the popularity of SMS usage. Would that bring a collateral effect to the providers of cellular value-added service positively or negatively? In response, this research will discuss the challenges facing Taiwanese cellular value-added service providers. Hinet, Taiwan Cellular Corporation (TCC), and Flyma online service providers have been chosen as research companies.
TopBackground
The great innovation of information technology (IT) has brought both cellular phone and Internet technology to reality. A high penetration rate of cellular phone subscribers and a great popularity of Internet users has completely changed communications between people. With these two new technologies, people can communicate with each other without concern about when and where. The created value of cellular value-added service has been considered a significant issue in this research.
According to the Marketing Intelligence Center, the cellular value-added service can be categorized as message-based service, entertainment service, financial service, or information service.Table 1 shows the categorization.
Table 1. | Category | Description | Application |
| Message-based service | Providing users real time message services | Short message service (SMs), e-mail, multimedia service |
| Entertainment service | Providing users recreational services | Downloading hot pictures, music, and games |
| Financial service | Providing users services of financial issue | Mobile banking, mobile shopping, etc. |
| Information service | Providing users up-to-date information | Information on weather, news, sporting, mapping, etc. |
Key Terms in this Chapter
Message-based Service: Providing users real time message services, for example, short message service (SMS), e-mail, and multimedia service.
Cellular Value-Added Service Categories: The cellular value-added service can be categorized as message-based service, entertainment service, financial service, and information service.
Financial Service: Providing users services of financial issue, for example, mobile banking and mobile shopping.
Balance Scorecard (BSC): A strategic management system and performance measurement.
Entertainment Service: Providing users recreational services, for example, downloading hot pictures, music, and games.
Information Service: Providing users up-to-date information, for example, information on weather, news, sporting, and mapping.
Short Message Service (SMS): Often called text messaging, it is a means of sending short messages to and from mobile phones.