FITEL bet on PHS — a cordless phone pretending to be a network

First International Telecom (FITEL) was established in April 1997 as a paging company in Taiwan. In 2000 it won a license to operate Personal Handyphone Service (PHS) — a Japanese cordless phone technology developed by NTT Laboratories. PHS used low-power base stations with a 100–500 meter range and was more like a cordless telephone with handover capability than a true cellular network. Pejoratively dubbed the "poor man's cellular," PHS had limited range, could not handle high-speed handover, and was already being overtaken by GSM when FITEL launched its network in May 2001.

FITEL never achieved the scale of Taiwan's GSM operators. By 2004 it had 770,000 subscribers against a national mobile penetration rate that had already passed 100%. In 2005 it was already desperate — trying to boost sales of dual-mode PHS-GSM handsets from 20% to 50% of total sales. The subscriber base peaked at 1.5 million in mid-2009, then began a steady decline. By end-2012 the company had 748,750 subscribers, down from 833,227 a year earlier.

In 2013, FITEL received regulatory approval to upgrade to XGP (a next-generation PHS technology) and sought to raise TWD 5 billion (about $169 million) for the project. The upgrade never materialized. By end-2013 subscribers had fallen to 725,000. In April 2014, FITEL began dismantling base stations to reduce operating costs, shrinking its coverage in a self-reinforcing death spiral. The company sought strategic investors but failed to attract any — there were seen to be few prospects for developing PHS in Taiwan.

In December 2014, the Taipei District Court declared FITEL bankrupt. The NCC announced plans to cancel its license and reassign its two million allocated phone numbers to five other operators. By May 2015, FITEL's 400,000 remaining subscribers were ported to Chunghwa Telecom, Taiwan Mobile, Far EasTone, Asia Pacific Telecom, and Taiwan Star Cellular. The company that had bet on a dead-end technology was gone.