5G broadband services won’t be costly, thanks to market competition, Hong Kong commerce chief Edward Yau says

Minister says roll-out plans announced earlier would save time and cost, contributing to smart city development and innovation in all areas

PUBLISHED : Saturday, 28 July, 2018, 5:15pm
UPDATED : Saturday, 28 July, 2018, 11:00pm

Services for the 5G mobile broadband in Hong Kong will not be too costly thanks to competition in the local telecoms industry, the city’s commerce chief said on Saturday, following the roll-out of plans for the new network.

The comments by Secretary for Commerce and Economic Development Edward Yau Tang-wah came after the government suggested on Thursday to assign the services to telecoms companies instead of calling for an open auction. Officials also proposed allowing operators to use the spectrum for free or by paying a very low price.

The spectrum – or radio frequencies – allow data to be transferred 20 times faster than existing speeds. Under the plans, 4,100 megahertz of spectrum in the high-frequency, high-capacity 26 Ghz and 28 Ghz bands would be assigned to telcos.

Speaking on a radio programme on Saturday, Yau said he believed service charges would not be too high because market competition would play a role in price-setting.

“Through market competition, even though there were auctions [for the existing networks], the service charges of Hong Kong’s network still look attractive when compared with other places,” Yau said.

He said the government chose not to allocate the spectrum through an auction because supply outweighed demand, adding that the 5G spectrum amount in the city exceeded the total of 2G, 3G and 4G systems by seven to eight times.

Cheaper, faster 5G roll-out with proposal to not charge telcos for spectrum

Yau argued that this allocation method would save time and cost for operators.

From the end of this year to early next year, telcos and new entrants to the market can submit applications for the high-frequency spectrum to the government.

The allocation process is expected to finish in the first quarter of 2019, so operators can begin planning and setting up the network in the same year and launch the services in 2020 – a target set by the International Telecommunication Union, a UN body.

Yau said the speed of the 5G network would be at least 10 times faster than the existing 4G system and it could connect to 1 million devices within 1 sq km. Sending and receiving a message on a smartphone would just take a millisecond, he added.

According to him, the introduction of 5G services would help Hong Kong become a smart city and the technology could facilitate development in other areas such as driverless cars and telemedicine, as well as urban planning and logistics.