My Take

Government creates own free-TV crisis

PUBLISHED : Monday, 21 October, 2013, 3:23am
UPDATED : Monday, 21 October, 2013, 3:23am

There are two things to keep in mind if we are to understand the government's bungled free-TV licensing saga. The first is failed licence applicant Ricky Wong Wai-kay's willingness to commit HK$900 million - if we are to trust his numbers - to a TV station before he had a licence. Even a third of that is a large sum.

The second is TVB's claim that there was a clear understanding with the post-handover government when it and ATV were each granted a 12-year licence - with expiry in 2015 - there would be no new competitors during those years. For this, TVB tried but failed to launch a judicial review. Interestingly, its stock, which had gone through a 20 per cent correction since May, has started a recovery once the government announced the granting of two licences to PCCW and i-Cable but not to Wong's Hong Kong Television Network. Did investors think HKTV, now safely neutralised, was the bigger threat to TVB's market dominance?

Wong may be impulsive but he is no fool. The fact that he was invited by the previous government to apply for a licence must have given him a strong impression that his being granted one was almost a sure thing - hence his willingness to commit on such a scale. That is why, with good reason, he feels burned now.

The dilemma that commerce chief Greg So Kam-leung and the current government faced was how to introduce more TV stations without upsetting TVB and ATV. This explains why So had dragged his feet to make a decision for more than two years since he took over his current post. The two licences, even now, have only been granted "in principle". That will buy the government even more time to take it through 2015, by which time TVB and ATV will have no case to complain.

The problem with Wong is that if he was as good as he claimed, his station could go on-air today if officials let him. If he had kept quiet and been less gung-ho, he might have a fighting chance.

In resolving its business dilemma, the government has created a political crisis for itself. For the government to conduct business as usual is to invite disasters. By only juggling the concerns of commercial parties, it has completely neglected the public, the largest stakeholder in free-TV broadcasting.