What is Cellular Value-Added Service Categories

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.