Hong Kong pay TV broadcaster i-Cable takes ‘important step’ to stay afloat
As struggling company halts trading, tycoon David Chiu says he looks forward to investing in the industry with ‘like-minded people’
Cash-strapped broadcaster i-Cable Communications has taken an “important step” towards carrying on its business, chairman Stephen Ng Tin-hoi said on Tuesday amid fears of an impending shutdown.
Ng, who is also chairman of i-Cable’s parent company Wharf (Holdings), made the announcement in an internal circular to staff.
The letter did not contain details of the steps taken. But it was issued as a consortium called Forever Top led by tycoon David Chiu Tat-cheong admitted earlier that it had reached out to i-Cable to discuss investing in the company.
“I am pleased to advise that a small but important step has been taken towards enabling the company to accept a new pay TV licence and to carry on with its pay TV, free TV and broadband businesses,” the letter said.
“Fuller information is expected to be disclosed later this week after an announcement has been cleared with [the Securities and Futures Commission and Stock Exchange]. In the meanwhile, it is business as usual.”
Forever Top said in a statement that the company had always been interested in the television industry and looked forward to working with like-minded people. The company was working hard to reach that goal and “will announce the progress at a suitable time”, the statement said.
I-Cable halted trading on Tuesday morning. In another statement the company said trading was halted “pending the release of an announcement which is inside information of the company”.
Shares were suspended before the start of the trading at 61 HK cents apiece. Its share price has fallen 22 per cent since the start of the year.
The troubles started in March when Wharf announced it would cease funding i-Cable, which reported a HK$313 million loss last year.
The government had earlier agreed to renew i-Cable’s pay-TV licence for 12 years to 2029, and the broadcaster has until April 26 to reply. It’s current licence ends at the end of May.
I-Cable also runs broadband businesses and has a subsidiary called Fantastic TV, which is a free-to-air TV station due to start running next month.
“We still don’t have confirmation who is investing in i-Cable. But at least it seems the company won’t be shutting down,” an i-Cable employee said. “We want to know what the investor is going to do with the company.”
Adjunct Professor Leo Sin Yat-ming of Chinese University’s business school said i-Cable needed to diversify its business and do so creatively.
“If you use the traditional way to run a TV station, it will be hard to survive. ATV has already been shut down and TVB is not doing well financially. You need to make better use of the station and use it as a platform to reach out to people,” Sin said.
For example, instead of broadcasting adverts for different companies to help them find potential customers, i-Cable could consider selling the products itself and make a profit.
“Many people believe that just because other people can’t run a business properly does not mean that they themselves won’t be able to do a good job. That’s a dangerous mentality. To turn around i-Cable, you have to seriously think about what separates your business from the competitors,” he advised.