CTI wants decision on TV licences

City Telecom (CTI), Hong Kong's second largest broadband service provider, has urged the government to fast-track new free-to-air television licences.

CTI chairman Ricky Wong (pictured) said he did not have a clue when the government would issue the licences, but hoped it would be soon.

'We handed in our application in December 2009 and have been waiting for 16 months,' he said.

The issuing of new free-to-air TV licences will mark the end of the duopoly long held by Television Broadcasts and Asia Television.

However, CTI is not the only new entrant seeking to join the fray: other players include Fantastic Television, a wholly owned subsidiary of pay-TV provider i-Cable Communications, and HK Television and Entertainment, which is owned by Richard Li's PCCW Interactive Media Holdings.

The market expects the Broadcasting Authority to make recommendations to the government by the end of this year.

'We see free TV as a long-term investment,' Wong said.

CTI reported yesterday that net interim profit rose 44 per cent year on year to HK$168 million.

Turnover rose 5 per cent to HK$826 million, mainly due to growth in its fixed telecom network services unit.

CTI increased charges for its 100 megabytes per second broadband service by 70 per cent to HK$169 last September.

The higher charges affected subscriptions, and CTI said it now expected total broadband subscriptions to pass 580,000 by the end of August, down 20,000 from a previous forecast.

As of last August it had 526,000 broadband users, and enrolled 25,000 new subscribers in the six months to February 28, bringing the total to 551,000.

Wong said customers had adjusted to the price rises, and predicted that second-half 'subscriptions will definitely be higher than the first half'.

CTI is offering add-on services to its entry-level product to improve the average revenue per user (ARPU). For example, customers subscribing to its HK$169 100mbps broadband service can gain access to IP-TV, with more than 100 channels, or an upgrade to 1Gbps broadband for an extra HK$30.

The company said that during the six-month period its ARPU rose to HK$167 from HK$135.

Income from its international telecom business continued to fall during the six-month period, slipping 10.4 per cent to HK$98.7 million.

But this was offset by the contribution of its fixed telecoms network services, where turnover rose 7.6 per cent to HK$727 million, contributing 88 per cent of total revenue.

Earnings before interest, tax, depreciation and amortisation rose 16.7 per cent to HK$302 million, and CTI expects the full-year figure to reach HK$580 million.