'In the future, we may be looking at issuing a single licence to operators to offer both fixed and mobile services,' Au Man-ho, director-general of the Office of the Telecommunications Authority (Ofta), said yesterday.

Starting the consultation process was a priority this year, he said.

A change in licensing regime is needed to keep pace with the swiftly changing technology landscape. Fixed-line carrier PCCW has tested a portable phone that can accept voice calls over a Wi-Fi connection while operator CSL is selling a 2.75-generation handset that can also be used in Wi-Fi hotspots.

In addition, PCCW is studying WiMax, a form of Wi-Fi that promises data transfer speeds of up to 70 megabits per second (Mbps).

Backers of WiMax claim services for 'nomadic' devices such as laptops will be available this year while a mobile version for handsets could arrive within two years to compete with the 3G networks built by mobile operators.

'Nomadic network services will increasingly put the interests of fixed and mobile operators into conflict,' Mr Au said. 'But we feel that our regulatory regime should not favour either side.'

Ofta, however, is likely to come under criticism from mobile operators as it receives responses to its present consultation on 'fixed' wireless broadband services.

The regulator has taken the preliminary position that only fixed-line licence holders can bid for spectrum. Mobile operators, in theory, should be protected because the fixed wireless services have no cell hand-off capability.

Ofta said the consultation on fixed wireless broadband would conclude before it considered changing to a unified regime.

A key element of a unified regulatory environment will be the separation of the service licence from the allocation of spectrum needed to offer wireless services. This will allow spectrum holders, which acquire bandwidth through auction, to offer new services as technologies develop or trade spectrum with other operators.

Also up for review are interconnection fees between fixed and mobile operators. At present, fixed-line players can charge their mobile counterparts for connecting to their networks, but not vice versa.

Claus Mortensen, an analyst at International Data Corp, does not believe this will lead to price increases by fixed-line operators. 'There is too much competition in the market already,' he said.

Another market in which fixed and mobile services are converging is South Korea. Fixed-line giant KT Corp this year is expected to launch Korea's homegrown version of WiMax - Wi-Bro - which provides downloads of up to 1 Mbps.