This article was published on May 23, 2013

Foxconn is reportedly keen on a 4G license in Taiwan as it aims to diversify its business


Foxconn is reportedly keen on a 4G license in Taiwan as it aims to diversify its business

Hot on the heels of investing $8.7 million in a local fiber optic provider, Taiwanese firm Foxconn is now said to be setting its eyes on acquiring a 4G license in the country.

According to a Sina Tech report, Foxconn is currently gauging a bid for 4G spectrum in Taiwan. The company is making the move as part of its “eight-screen-in-one-cloud business strategy,” a source in the report says.

Foxconn, also known as Hon Hai Precision Industry, has seen its revenue growth slowing amid a faster-than-expected decline in iPhone orders. By targeting downstream processes – which occur after the manufacturing of electronics has taken place – the company is hoping to spread its net wider and capture more revenue sources. Such steps could eventually enable it to get involved in the entire chain of processes and facilitate the sales of its own product.

Taiwan’s National Communications Commission last week announced its 4G licensing plan with a starting bid of NT$35.9 billion ($1.2 billion), and major telecom carriers such as Chunghwa Telecom, Taiwan Mobile and Far EasTone have already expressed their interest in bidding.

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The Sina Tech report says Foxconn hopes to enter different parts of the chain of processes via cooperation and alliances. Chairman Terry Gou is said to have already been sussing out talent in the telecom and cable industries for possible recruitment, and could possibly ink a collaboration with Ruentex Group president Samuel Yin in the 4G market, but they are still in the initial stages of discussion. Ruentex’s is a diversified business, with interests ranging from real estate to textile, finance and retailing.

Ruentex has invested in a local 4G operator Global Mobile Corp, but the Taiwan regulator has ruled that firms applying for 4G spectrum need to have at least NT$6 billion in capital ($200 million), whereas Global Mobile Corp’s capital only stands at NT$3.5 billion ($117 million). The report says Ruentex and Foxconn could help each other if they form an alliance.

Foxconn is based in Taiwan, but it is more famously known for its operations in mainland China. It is the world’s largest electronics contract manufacturer by revenue, and has taken on most major electronics brands as its clients. Earlier this year, chairman Terry Guo indicated that his company was planning to prioritize investments in Taiwan as it expands.

We reached out to Foxconn for comment and will update this article with any response that the company provides.

Image Credit: AFP/Getty Images

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