Despite a local lack of enthusiasm for video on demand (VOD), Californian company MatrixStream Technologies believes Hong Kong could be a major market for its VOD system.
MatrixStream offers a solution that allows high-definition VOD content to be accessed over any broadband network, eliminating the need for VOD operators to build a dedicated network to cater to their customers.
Chief executive Jack Chung said the company's system should appeal to broadband operators looking to offer VOD as a value-added service to subscribers.
Hong Kong's broadband market is already very competitive, with about 50 per cent of households wired for broadband access. That figure is surpassed only by Taiwan.
Hong Kong has six major broadband network operators and, according to Pyramid Research, the territory will have the highest broadband penetration of any Asian country by 2006. However, Pyramid warns that competition and intense price wars will take their toll on operator margins before then. They advise operators to adopt a content-driven strategy if they hope to succeed.
VOD has a mixed history in Hong Kong. The former Hong Kong Telecom began trials of the world's first wide-area VOD network in 1995. Unfortunately, difficulties in attracting subscribers meant that the much-hyped service soon disappeared from the headlines.