Further opening up the telecommunications market in the Hong Kong Special Administrative Region (SAR) will enhance the attractiveness of the territory as a place for investment in telecommunications, encourage competition and innovation, and maintain Hong Kong's position as the pre-eminence telecommunications centre in Asia.

This was stated by the Secretary for Information Technology and Broadcasting of the Hong Kong SAR Government, Mr K.C. Kwong, in Ottawa today (September 23).

Mr Kwong, who was speaking to senior information technology/telecommunications executives and members of the Ottawa Centre of Research and Innovation at a breakfast meeting, said the liberalisation of the telecommunications market is part of the government's policy objective of providing the widest range of quality services to the community efficiently and at reasonable cost.

In providing details of the move, he said the SAR government is considering the most appropriate way to encourage further investments in the telecom networks in Hong Kong and welcomes proposals regarding commitments to invest in the local networks from existing and potential operators before a firm decision regarding the moratorium on the issue of local fixed telecommunication network services is made.

On external telecom market, Mr Kwong said, licences for such services, to be effective from January 1, 1999, are intended to be issued on demand, and licences for external facilities, to be effective from January 1, 2000, are also intended to be issued on demand.

He pointed out that a teleport site in the southern part of Hong Kong island will be made ready for use by operators to enable external facilities based competition to commence from January 1, 2000.

The Secretary also described in detail the present telecommunications and information technology situation in Hong Kong.

On the former, he said the local fixed telephone networks are 100 per cent digitised; 36 per cent households and businesses have kerbside connection to broadband networks; there are 108 exchange lines per 100 households and 37 percent of the population or more than 2.3 million people are subscribers of mobile phone service.

Regarding the latter, the SAR Government spent US$2.4 billion - 1.4 per cent of its GDP -- on hardware, services and packaged software in 1997. According to a study, the software business will expand by 21 per cent this year. The number of Internet accounts in June 1998 was 577,283, representing a 38 per cent increase over the figure of December 1997.

"In Hong Kong, we are witnessing the emergence of some innovative use of the Internet. For example, one local Internet service provider is providing on-line supermarket shopping and on-line banking. The Hong Kong Trade Development Council also operates a cyber bookshop. With the extensive reach of the Internet, the business opportunity in this area is enormous," he said.

"With our excellent networks, our unique geographical position vis-�-vis the mainland of China and our capability in providing Chinese and English language support, Hong Kong has an unparalleled advantage to serve as an information gateway to China, and become an Internet hub of the Asia Pacific Region, helping overseas suppliers market their products in China."

Mr Kwong added that in the public sector, the on-going SAR government's office automation programme will be extended to cover the whole establishment by the year 2000.

He revealed that the government's IT projects now undertaken mainly inhouse will be outsourced to the private sector with a view to encouraging further development of the IT industry in Hong Kong.

Turning to the broadcasting industry, Mr. Kwong said "the TV market will also be opened up, with a view to creating an environment conducive to the flourishing of the television market and to the introduction of innovative services using new technologies."

He said, "The new licensing regime will be sufficiently flexible to enhance new services made possible by convergence in technologies. To enable diversification and cross-fertilization of telecom and broadcasting markets, we propose to relax the restrictions on ownership and investment by licensees.

"The Government will facilitate the development of digital terrestrial television (DTT) which will bring about spectrum efficiency and allow programmes to be broadcast in much higher resolution.

"Technical trials will be conducted with a view to determining a DTT standard to be adopted in 2000."

Following the breakfast meeting, Mr Kwong, accompanied by the Director of the Hong Kong Economic and Trade Office of the SAR Government in Canada, Mr. Donald Tong, held a meeting with the Minister of Industry, Mr John Manley.

Mr. Kwong also met senior Canadian IT executives at a luncheon hosted by Minister Manley and visited two major Canadian IT/telecommunications companies.

In the evening, Mr Kwong was the guest of honour at a dinner hosted by the Hong Kong Canada Business Association, Ottawa Section, at the prestigious Rideau Club.

For further information please contact Frank Chuan, Chief Information Officer at telephone no. (416) 924-5544.