Chunghwa Telecom Undersea Cable Failure Due to Earthquake.

TAIPEI, Taiwan, R.O.C. -- An earthquake (grade 6.5) in the southern seas off Taiwan at 20:00 on Dec. 26 brought a great impact on Chunghwa's undersea cables. Soon after the outages on China-US and the southern section of SMW3 cables, the company had the traffic ride on the restoration routes APCN and APCN2 cables in accordance with contingency plan. However, another two joltings followed and broke the restoration routes (APCN and the southern section of APCN2) in the early morning of Dec. 27. Currently, only the northern sections of SMW3 and APCN2 are available to accommodate the traffic.

Countermeasures

* Voice

The Company made use of the unaffected cables and satellite circuit (ST-1) to increase the number of usable circuits. The completion rate has also been improved greatly with routing assistance from the foreign carriers. Until the afternoon on Dec. 28, the completion rate to USA was upgraded to 76%, Mainland China 57%, Canada 64%, Japan 73%, Hong Kong 45%, Singapore 57%, Europe 50%, Southeastern Asia also raised to 30%.

* Data

The capacity available in the northern section of APCN2 cable was utilized to transit the IPLC traffic to Hong Kong and Singapore via Mainland China. Interim lease of private cable was also adopted for continuing corporate IPLC service. So far, only limited IPLCs left for repair.

* Internet

The capacity available in the northern section of APCN2 cable was also made use to increase the total international bandwidth.

Persistent Measures

* Chunghwa will keep on seeking capacities from private cable operators and continue the repair work on the IPLC and Internet circuits.

* Cable repair

The Company has contacted cable ship companies for prompt repair. Four cable ships will be dispatched to the outage areas and repair work will begin on Jan. 1, 2007. The recovery is scheduled to be completed around three weeks.

About Chunghwa Telecom

Chunghwa Telecom (TAIEX 2412, NYSE: CHT) is the leading telecom service provider in Taiwan. Chunghwa Telecom provides fixed line, mobile and Internet and data services to residential and business customers in Taiwan.