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SCMP Reporter

SmarTone-Vodafone, the mobile-phone business of Sun Hung Kai  Properties,  will increase the  pressure on  the telecommunications regulator to allow full phone-number portability as the company prepares to launch a home-phone service using its mobile network, company sources said. 
The move comes as  the Office of the Telecommunications Authority (Ofta) is consulting the industry on a  regulatory framework covering the convergence of fixed-line and mobile-phone services. The deadline for the consultation  is October 27. 
SmarTone-Vodafone wants to offer a home-phone service using its third-generation (3G) mobile network to challenge  dominant fixed-line operator PCCW. 
This is expected to lead to phone operators offering fixed and mobile services under one full-service licence rather than under  separate regulatory regimes.
SmarTone-Vodafone has more than one million mobile phone users, of whom about 150,000 are 3G users. 
To attract business users, the company in June upgraded its 3G network to the 3.5G or high-speed downlink packet access standard which is four times faster than the 3G standard. 
The company is striving to boost customer numbers to  recoup the HK$1.3 billion  paid for the 15-year 3G licence and about HK$1 billion  spent on building the 3G network. 
SmarTone, which launched a mobile broadband service last month that operates at speeds similar to those on fixed-line broadband,  sees curbs on how customers can transfer phone numbers as limiting the success of its efforts to capture the fixed-line market. 
Fixed-line numbers and mobile numbers  can be transferred only within their category. That is, fixed-line numbers can be transferred to another fixed-line operator,  not to a mobile operator.
'The existing number portability regime puts an artificial hurdle to enhancing competition, and limits the choice of consumers,' SmarTone-Vodafone executive director Patrick Chan said. 
Removal of the hurdle would allow fixed-line users to transfer their numbers to mobile-service providers for a cheaper deal. 
'We can launch our service at any time by offering new numbers to users but the impact will be  limited. Once their number can migrate to mobile operators, fixed-line users can choose five mobile players for their home phones,' Mr Chan said. 
Even so, SmarTone-Vodafone's time-based tariffs may  deter potential users of the proposed home-phone service, analysts said.
SmarTone-Vodafone hopes to tap the fixed-line market by offering a usage-based tariff plan, charging on a per-minute basis or offering a monthly  package with hundreds of minutes of talking time for less than HK$100. 
Fixed-line operators such as PCCW and Hutchison Global Communications charge on a flat-rate basis with a monthly tariff for unlimited calls to local fixed-line and mobile numbers. 
'As mobile-phone traffic dominates the market, fixed-line phones at home no longer need an unlimited package,'  Mr Chan said. 'A flat rate implies higher charges for users. Users can save more by paying on a usage basis.' 
Fixed-line operators charge users between HK$50 and HK$110 per month for a single-line service, while value-added services such as caller number display may not be included. 
'If we charge users HK$50 for 300 minutes per month, this should be a bargain deal, as users pay HK$110 per month for unlimited calls. It's a waste,' Mr Chan said.
 Fixed-line operators are not allowed to provide  their services on a time-based  tariff, a PCCW spokesman said.
In 2002, Ofta  said the public preferred to have a flat-rate fixed-line service but it would not bar operators from offering a time-based tariff after strong opposition during a public consultation regarding a change from  flat-rate to time-based billing  in 1996 and 1998.
'SmarTone-Vodafone is ready to launch the service as it has no technical hurdles,' Mr Chan said. 'The company will leverage on its  3G network, and offer the service through a specially designed phone that will be just like your  fixed-line phone but rather than using  a fixed-line slot, it will have a SIM card slot to connect to the network.' 



SmarTone presses for full number portability