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Taiwan Mobile plans a soft launch of third-generation (3G) services later this month, ahead of a full-scale roll-out planned for later this year.

The company's foray into high-speed data services will be   watched closely by industry analysts.

In addition to offering video content to lure subscribers, Taiwan Mobile should be able to price its voice services at a steep discount to 2G operators.

Taiwan Mobile has 6.63 million subscribers, compared with 8.1 million claimed by state-run Chunghwa Telecom.

Sources told the South China Morning Post 3G services would be launched on or around May 25 but with no fanfare or official announcement.

Instead, high-value customers will be invited to sign up for 3G while walk-in customers will be given the opportunity to buy a handset and sign up.

The soft launch will allow Taiwan Mobile to work out any bugs before a full-scale launch later this year.

The operator is expected to offer Nokia's Symbian-powered 6630 and 6680 handsets, Motorola's V975 and E1000 models and a Sony-Ericsson Z-series handset.

Taiwan Mobile  is the second operator to come to market with 3G services. New entrant Asia Pacific Broadband Wireless  launched its 'QMA' service in July 2003, using CDMA 2000 equipment. It has 500,000 subscribers, less than an initial target of 700,000.

Chunghwa Telecom intends to launch 3G services next month, followed by Far EasTone in July and new entrant Vibo Telecom, part-owned by Compal Electronics, in the autumn.

Each of those operators will use W-CDMA gear.

Taiwan Mobile's entry into the 3G market could spark a price war in Taiwan. The company plans to have coverage of 70 per cent to 75 per cent of the island's population by the end of the year.

Asia Pacific Broadband prices its voice calls  20 per cent to 35 per cent below Taiwan Mobile's present 2G tariff plan. Because of greater bandwidth, 3G operators are able to price voice calls 30 per cent to 50 per cent less than they do 2G calls, allowing operators to lower tariffs without hurting margins.

The big question is whether Taiwan Mobile will be able to win new customers from rivals. It may wind up cannibalising its existing subscriber base.

It must also boost data revenue with attractive content - a task that has proven difficult to date. Data  made up 6.2 per cent of revenue in the first quarter, up from 5 per cent in the fourth quarter last year.



Taiwan Mobile to give 3G low-key launch