Villages still lack fixed-line phone choice

PUBLISHED : Monday, 24 March, 2008, 12:00am
UPDATED : Monday, 24 March, 2008, 12:00am

20pc of remote and old homes have no options on networks

About 20 per cent of households in old buildings and remote areas still lack any choice of a fixed-line phone carrier - five years after the market was liberalised.

But new technology to be introduced next year may break the deadlock, according to an industry source.

Office of the Telecommunications Authority figures revealed that last year, 79 per cent of 2.5 million households had a choice of at least two fixed-line carriers, but the percentage was increasing at a diminishing rate.

In 2004 - one year after the market was deregulated - about 60 per cent of households were given at least one alternative. The following year, 71 per cent were given an alternative. In 2006, the figure had risen by 5 percentage points to 76 per cent. Last year, the total rose by only 3 percentage points to 79, with 55 per cent of households able to choose from three operators.

Under its licence conditions, PCCW is obligated to provide a telephone line to every household - regardless of location - at affordable prices. However, the other four fixed-line operators - Hutchison Global Communications, Wharf T&T, New World Telecom and Hong Kong Broadband Network - are able to let commercial considerations determine where they provide services.

All the operators provide fixed-line phone services for between HK$108 and HK$150 per month.

A telecoms industry source said operators did not consider it cost-effective to invest in new networks in some remote areas.

It was understood that residents of some old buildings in Wan Chai and Sham Shui Po were also unable to subscribe to any service other than that provided by PCCW.

'When the threshold cannot support the return, new investments are not justifiable,' the source said.

Leasing PCCW's 'last-mile' copper wire network, which was an alternative to connect end-users with telephone exchanges, was also unprofitable, the source added.

Lawmaker Albert Chan Wai-yip, a member of Legco's information technology and broadcasting panel, said it was difficult to offer every household an alternative carrier.

'A fixed telephony service is, in fact, less important to many households nowadays and it is understood that operators do not prefer to spend money on new networks,' he said.

Mr Chan added that some remote villagers in the New Territories had already terminated their fixed-line services. 'They are using mobile phones instead.'

New broadband wireless access (BWA) technology, or WiMAX, will be introduced next year to provide wireless, fixed and mobile services, following a licence auction to be held by the end of the year, Ofta says.

'I do not think the market liberalisation will encounter an [access] deadlock, particularly after the introduction of BWA technology,' the industry source said.

He said existing fixed-line operators may consider bidding for a licence to provide wireless broadband, as well as to gain last-mile access to households. Fixed-line operators are entitled to lease PCCW's last-mile network, but this is due to expire in the middle of the year.

'Consideration of the cost to access remote areas will be less significant with the wireless broadband technology, compared with [investment needed] at present,' he said.

An Ofta spokeswoman said one of its roles was to encourage investment and facilitate the provision of new technologies in a timely manner.

Since the full liberalisation of the fixed-line market in January 2003, there is no limitation on the number of fixed network operators.

End of the line

Fixed-line phone operators consider some households too old or remote for their services

The proportion of households that have a choice of two or more services : 79%