High fixed-line network charges blamed for Web traffic bottleneck
High charges for fixed-network traffic have created a bottleneck in Internet-traffic delivery that is not expected to ease soon, according to Global One executives.
They said limited inroads made by the three alternative fixed-network operators which entered a deregulated market in 1995 meant market dominator Cable & Wireless HKT had little incentive to cut prices.
Global One, a wholly owned unit of France Telecom with operations in 65 countries, offers global telecommunications connectivity mainly to multinational firms.
Mary Yeung, managing director for Hong Kong, said local Internet delivery costs are as much as 30 per cent to 50 per cent higher than in the United States, one of the world's most deregulated telecoms markets.
'HKT has more or less kept their prices at the same level over the last few years,' Ms Yeung said. 'Other operators - such as New T&T - are offering services at merely 10 to 15 per cent lower.'
However, the combined market share of New T&T, Hutchison Global Crossing and New World Telephone was only 5 per cent, according to a spokesman from the Office of the Telecommunications Authority. That compared with 3 per cent in the middle of last year, when the three firms were forced by Ofta to speed up construction of their fixed-line networks, or face competition from new entrants.