Bureaucratic timidity leaves spammer in the works for mobile users

PUBLISHED : Tuesday, 18 July, 2006, 12:00am
UPDATED : Tuesday, 18 July, 2006, 12:00am

THERE IS MORE trouble brewing for PCCW than just a political spat about how its controlling shareholder, Richard Li Tzar-kai, is divesting his shares.

The latest threat to its business takes the form of efforts to achieve what is called fixed-mobile convergence in Hong Kong and, much as our dominant fixed-line operator may recoil from the prospect, one proposed change alone would bring a very welcome benefit to the rest of us. Spam calls on our mobile phones would be significantly reduced and possibly vanish.

Let me set the background. When you make a call on a fixed-line phone to a fixed-line phone operated by a different company, your phone company pays the interconnection charge.

When you make a call on a mobile phone to a mobile phone operated by a different network operator, both operators bill and keep their own charges. The two billing systems are different but no one complains.

They are both reasonable ways of doing things.

Now consider what happens on phone calls between mobile phones and fixed-line phones. When a fixed line calls a mobile, the mobile pays. It does not work the other way round, however. When a mobile calls a fixed line, the mobile also pays. It's a heads I win, tails you lose system for the fixed-line companies.

We have it because mobile phones, when first introduced, were considered a value-added service to fixed-line phones. As the chart shows, however, it is not that way any longer. It is also no minor matter now. Fixed-line operators take in $600 million a year from mobile operators this way.

This anomaly has also lent itself to spam calls on mobile phones. Set your computer up to make recorded calls through a fixed line to thousands of mobile phones and you pay not a cent. It is the sufferers of this nuisance who pay rather than the creators of it.

There is a good deal more to the concept of fixed-mobile convergence than ending this anomaly, of course. The distinctions between the two forms of telephony are increasingly blurred and a consultant for the Office of the Telecommunications Authority has estimated that adopting full convergence could bring 'efficiency gains' of about $3 billion a year by 2011.

But this will have to be a step-by-step process. A consultation paper just published by the authority concentrates heavily on that anomaly of calls between fixed and mobile phones and it recommends ending the anomaly. Unfortunately, it does not recommend much else. The authority hopes that fixed and mobile operators can sort out a new payment system by themselves and proposes giving them two years to do so.

It has to be a vain hope. PCCW has about a 50 per cent share of fixed-line connections in Hong Kong and about a 70 per cent share of the traffic on them. It has no possible interest in cutting off a lucrative stream of income to itself and it will stall for time, calling in vast batteries of lawyers to help it do so. With its market share, it can pretty much dictate the stance of the fixed-line camp.

The authority would have done better not to be so timid.

I can understand its reluctance to intervene in the market but it will almost certainly have to do so anyway in two years' time, in which case it may as well get the ball rolling now and forget about that two-year period.

It has also been timid in other ways. One of the big hopes of mobile operators was that they might get portability of telephone numbers between fixed and mobile networks. In other words, you keep the home telephone number that all your friends know but you assign it to a mobile operator rather than PCCW.

The mobile operator would then give you a telephone set that looks exactly like the one you have at home, if you want it that way, but instead of being hooked to a fixed line, it would be hooked to a wireless network.

There is 'no imminent need', says the authority of this idea and shuffled it off with a few words about being 'minded to study' it and letting another committee deal with it in 'due course'.

This baffles the mobile operators. They are convinced they can undercut fixed-line charges with fixed-line number portability and they mutter of PCCW favouritism in the authority.

I shall not venture here into the murky world of telecommunications politics, but I do know that I like that first idea of getting the spammers off my mobile by reforming the present system of charges on calls between fixed line and mobile phones.

And I would much rather not wait for two years (probably longer with Ofta timidity) to see it done.