One answer arrived this week on “the question of Hong Kong” that confirmed China’s intention of allowing open competition in wireless, despite a hold-up in the licensing process.
Hong Kong reverts back to the authority of China in 1997, following the end of a 99-year lease by the United Kingdom. Issues regarding that transition are often referred to by China as the question of Hong Kong, considering the vast differences in the political systems of the two nations.
Hong Kong said last year it would open the mobile market to a half dozen more operators, but an official tender has yet to be issued.
Hongkong Telecom, which is both an international landline and wireless provider there, has been pressing the Office of Telecommunications Authority in Hong Kong to clarify whether it will continue to recognize a 15-year exclusive international direct dial contract after 1997.
The OTA announced last week the contract would be upheld until 2006. And in the course of that proclamation, OTA reiterated its position that mobile-satellite phone service would be open to competition.
Hongkong Telecom claims to be the country’s mobile leader with about 34 percent market share and more than 200,000 customers. Hongkong Telecom is owned 57.5 percent by Cable & Wireless plc.
The second leading Hong Kong operator is Pacific Link Communications Ltd. with about 30 percent of the market. Hutchison Telecom, which last year rolled out a Code Division Multiple Access system, launched a price war recently to improve its subscriber count. SmarTone also operates in Hong Kong’s busy market, with a little more than 20 percent of the market share.
The wireless market in Hong Kong is expected to grow to about 2.5 million by 2005; the colony has a population of about 6 million.
The government of China says it intends to continue Hong Kong’s move to reinforce its telecom infrastructure, according to a recent speech given by the Chinese ambassador to the United Kingdom, Jiang Enzhu.
“After China resumes the exercise of sovereignty, British businesses cannot only maintain their presence, but continue to expand their business and operation there. We are optimistic about Hong Kong maintaining long-term prosperity and stability after 1997,” Jiang said.
China needs Hong Kong to conduct foreign trade and serve as a bridge to the rest of the world. It is a goose that lays golden eggs, he said.
“The local Hong Kong government will enjoy a high degree of autonomy except on defense and foreign affairs. The Central Government will not send a single official to join the local Hong Kong government. Hong Kong will run its own finance. The Central Government will not take a penny from it,” Jiang said.
Hong Kong will exercise autonomy over economic and trade affairs and “the economic policy of the mainland will not apply to Hong Kong,” he said.
