HKT Under Attack Again By Telephone Competitors

by Mary Swire, Tax-News.com, Hong Kong

12 June 2002

All of the ex-PTTs (pre-liberalisation telecoms monopolies) face complaints from new market entrants that the incumbent puts various barriers in their way, and Hong Kong Telephone is no exception. The one-time monopoly operator, which was a part of Cable and Wireless until it was bought by PCCW at the height of the telecoms boom two years ago, is regularly accused of preventing other telcos from expanding in the Hong Kong market by restricting or over-pricing interconnection possibilities.

The Government began liberalising Hong Kong's telecoms sector in 1995, but after seven years HKT retains 89% of the market, while the three new entrants - Wharf New T&T, Hutchison Global Crossing (HGC) and New World Telephone - share the remaining 11%.

At a hearing yesterday of a Legislative Council panel, fixed-line telecommunications operators again complained of problems, with Wharf New T&T vice-president Tony Cheung Tung-lan saying that the solution was to break up the company. If CyberWorks' resale business was taken over by an independent player, it would then be able to avoid conflicts of interest and treat all carriers fairly, he said.

Office of the Telecommunications Authority director-general Anthony Wong Sik-kei said the existing arbitration mechanism was effective in mediating disputes among carriers, and PCCW's director of regulatory affairs Stuart Chiron said: "I think to handicap PCCW means many customers would be harmed."

PCCW says that its competitors create their own difficulties because they don't build out their own networks, relying on HKT's; and it's a fact that the one company which has built its own facilities, Hutchison Global Crossing, has no complaints. HGC's legal and regulatory director Agnes Miu said: "We are less concerned with them because of our deliberate strategy of development of our own network.

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