Good afternoon, ladies and gentlemen. Welcome to the Chunghwa Telecom Conference Call for the Company’s First Quarter 2014 Operating Results. During the presentation, all lines will be on listen-only mode. When the briefing is finished, directions for submitting your questions will be given in the question-and-answer session. For your information, this conference call is now being broadcasted live over the internet. Webcast replay will be available within an hour after the conference is finished. Please visit CHT IR website, www.cht.com.tw/ir under the IR Calendar section. And now, I would like to turn it over to Fu-fu Shen, the Director of Investor Relations. Ms. Shen, please go ahead.

Thank you. This is Fu-fu Shen, the Director of Investor Relations for Chunghwa Telecom. Welcome to our first quarter 2014 earnings results conference call. Joining me on the call today are, Dr. Tsai, Chairman; and Mr. Shih, President. During today’s call, management will first discuss business, operational and financial highlights. Then we will move onto the Q&A session. On Slide #2, please note our Safe Harbor statements. Now, I would like to turn the call over to Chairman, Tsai.

Thank you, Fu-fu. Hello, everyone. Thank you again for joining our first quarter earnings call. I’d like to make a few remarks before the formal presentation. Since I joined the Chunghwa Telecom earlier this year, myself and my management team has been working diligently to revamp our corporate strategy in order to create an efficient fast moving and full service telecommunications company. So I want to start by first discussing our business goals and some actions we are taking for 2014. The overall goal we are putting in place is to transform our company into a full-service, digital convergence service provider. We will continue to build out our high-speed infrastructure in order to provide seamless mobile and fixed broadband services. We plan to offer 300 megabits per second to 1 gigabit per second and LTE mobile high-speed broadband access services, which will help facilitate our innovative digital convergence value-added service offerings that targets the individual customers, household and enterprise markets. In this context, we will continue strengthening our MOD services to ensure a gateway into our customers’ homes. So a key goal for this year is focus on business development, with an emphasis on the 4G enterprise revenue and fiber segments. First, as many of you know, we plan to rollout 4G services in July of this year. And by the way, this afternoon we were just awarded the license from NCC for the 4G service. Our aim is to acquire at least 40% of the 4G market share by the end of 2014. Second, we want to further increase our enterprise revenue share by offering a total solution package to small and medium enterprises which includes ICT solutions and cloud services. And finally, we will be offering fiber convergence plan that combines broadband and MOD packages, so that we…

Thank you, Chairman Tsai. Slide 6 provides an update on our mobile business. During the first quarter, mobile data revenue grew by 23.4% year-over-year, mainly driven by the 32.6% increase of the mobile internet revenue. We will continue our strategies to solidify high-tier smartphone users, introduce the mid-to-low-tier smartphones to expand mobile internet subscriber base. Accelerate the migration of the 2G subscriber to 3G networks and to speed up the 4G network deployment to enjoy the first mover advantage. For LTE service launch, there are more than 30 high-to-low tier smartphone in the picks [ph] available on 1800 megahertz band currently, which should strengthen our competitiveness in the 4G business. Moving onto Slide 7, our promotional initiative targeting mid-to-low tier smartphone users continue to boost our smartphone penetration to 56% at the end of the first quarter of 2014. ARPU for the first quarter decreased Q-o-Q mainly due to the continual promotional plan. During the quarter the plan was successful with regard to attracting new subscribers, but at the same time, cost us some temporary downward pressure on ARPU. We expect the ARPU to recover in the third quarter of this year. Slide 8 shows the results for our broadband business. During the first quarter, we continue to see a steady migration of the subscriber to higher speeds of fiber services. We witnessed over 23.2% year-over-year growth in subscriber opting for connection speeds of 60 megabit per second and higher, reaching about 1.19 million by the end of the March 2014. We will continue to encourage our subscriber to migrate to higher speeds of fiber offerings. As mentioned previously, the fiber convergence plan combining the broadband with MOD family packages stimulated both fiber migration and MOD subscription. We are also targeting the SMEs and the machine-to-machine applications to stimulate further…

Thank you. We will now begin our question-and-answer session. (Operator Instructions) Our first question is coming from Chate Ben, Credit Suisse Singapore. Go ahead please. Chate Benchavitvilai – Credit Suisse Singapore: Hi, good afternoon everyone. Thank you so much for the presentation and opportunity to ask the questions. I have four questions. The first one is regarding the 4G launch upcoming in July. I understand that one of your key advantages is 1800 megahertz spectrum 4G launch, which allows you a better handset ecosystem as you point out. However, your peers also would launch very similar – well during the similar period which is June, July in this year and also the ecosystem around handsets on 700 megahertz has improved significantly like HTC M8 or Galaxy S5 offer on that band. So do you think that advantage is sustainable, and is there anything that you would see as a key differentiation for you or your peers on 4G? Maybe we can go one by one question.

We have many LTE-ready handset smartphones like iPhone 5 and 5S and HTC etcetera. So we have expected more than 50 models will be available when we launch in July. So it’s far beyond what the 700 megahertz has. So we think we have the advantage compared to our competitors. Chate Benchavitvilai – Credit Suisse Singapore: Okay, thank you. And the second question is regarding your IPTV operations. I understand that its part of your call business strategy as well, the MOD services. However, when we see the number of subscribers growth has not really accelerate and your year-end target seems still on the higher side. Would there be any change in strategy around the MOD services throughout the year that would allow you to achieve your subscriber target?

Yes, we think the MOD is some kind of the differentiation by different categories, for example the movies, the drama and the sports. So we now focus on the demassified users. We would like to acquire more subscribers that focus on what they want instead of the linear channels. So we will do our best to acquire more subscribers, even the target is quite challenging. Chate Benchavitvilai – Credit Suisse Singapore: Right. The next question is regarding your cost control initiatives. I understand that that is part of the strategy as well. Where do you see within your cost structure that you can maybe cut or edit any kind of guidance and what amount of costs that you can save over the next few years?

I think this is the – we are right now reviewing every aspect of our operating expenses from the maintenance all the way to our administrative expenses. I don’t think we’re now today in a position to give you a forecast in that respect, but I hope maybe in next three months we will have a better forecast from that point of view. Thank you. Chate Benchavitvilai – Credit Suisse Singapore: All right. Just one last question. It’s a little bit housekeeping. I understand that you have already – you just received operating license for 4G, right? Does it mean that your amortization of spectrum would start right away?

Yes, when we launch the 1800 megahertz, we will amortize the license on the 1800 portion. The license lasts for 17 years. So we launch earlier than we amortize in a longer time. So yes, we will amortize the license fee since we launch the services. Chate Benchavitvilai – Credit Suisse Singapore: In July?

Maybe I want to add a comment on the IPTV part. I understand your question. We are, I think also, re-looking at our strategy. We will continue – I think not only continue, we will strengthen our content in the months to come. We’re in the process of doing that. I think the voice – the video-on-demand part, we will be able to provide a lot better content for our customers and potential customers. We will also increase our promotion so that I think we remain optimistic and we are determined to make this a success for the company. Chate Benchavitvilai – Credit Suisse Singapore: All right. That is great. Thank you so much.

We are now in question-and-answer session. (Operator Instructions) If there are no further questions, I would turn it back over to Chairman, Tsai. Go ahead please.

Thank you for attending the conference. I wish you good weekend to come. Thank you, and goodbye.

Thank you, Chairman Tsai. And thank you all for your participation in Chunghwa Telecom’s conference. There will be a webcast replay within an hour. Please visit www.cht.com.tw/ir under the IR Calendar section. You may now disconnect. Good bye.