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Following is a question by the Hon Sin Chung-kai and a written reply by the Secretary for Commerce, Industry and Technology, Mr Joseph W P Wong, in the Legislative Council today (October 18):
Question:
The industry has relayed to me that non-affiliated content providers in the market suffer from discrimination by certain mobile network operators (MNOs), including access speed and price discrimination, whereas affiliated content providers are given favourable treatment. In this regard, will the Government inform this Council:
(a) of the total number of complaints received since 2004 which are related to the above situation and the number of cases being handled;
(b) of the procedures for handling such complaints and the average time required to conclude a complaint case;
(c) whether it has ever reviewed the existing regulatory mechanism to assess if the mechanism is effective in enhancing the compliance of MNOs' commercial acts with the "Open Network Access" requirement in respect of content providers, ie, "the traffic of non-affiliated content or service providers (CSPs) of a certain class or type will be treated on a non-discriminatory basis compared with CSPs of the same class or type affiliated with the MNO"; if it has, of the outcome; if not, the reasons for that; and
(d) whether it will consider enhancing the existing regulatory mechanism or implementing other measures, such as requiring MNOs to publish regularly their network access levels, so as to promote fair competition among content providers; if it will, of the relevant details?
Reply:
Madam President,
Currently, there is Open Network Access (ONA) requirement in the third generation (3G) mobile services licences, whereby the licensees are required to open 30 per cent of the network capacity for Mobile Virtual Network Operators and non-affiliated content or service providers (CSP) and to provide access up to this threshold on a non-discriminatory basis. The Telecommunications Authority (TA) may determine the tariffs for the services, which include the relevant terms and conditions for the provision of the services, if the tariffs offered by a 3G licensee to a CSP are unfair, anti-competitive or discriminatory. There is a similar licensing requirement under the recently renewed second generation (2G) licences. It will be effective after the end of the sixth year of the renewal of the licence.
(a) The Office of Telecommunications Authority (OFTA) has not received any complaint since 2004 from non-affiliated CSPs concerning discriminatory treatment of Mobile Network Operators (MNOs).
(b) As OFTA has never dealt with complaint concerning discriminatory treatment of the MNOs, there is no information on the average time of handling such complaint.
If a complaint is received, OFTA will follow the ordinary procedures for competition complaints to conduct a preliminary investigation to establish whether or not there is prima facie evidence to indicate that the case merits full investigation. OFTA aims to complete the preliminary investigation within four weeks from its initiation. If OFTA is satisfied that the case merits full investigation, its performance pledge is to complete 80 per cent of full investigations on complaints against operators relating to competition provisions of the Telecommunications Ordinance within 4 months after preliminary investigation.
(c) The TA has not commissioned any review on ONA requirement because the TA considers that competition in the market is working well. The current regulatory regime has already provided an effective mechanism for the TA to intervene when necessary, with a view to ensuring that MNOs will treat non-affiliated CSPs on a non-discriminatory basis. So far, the TA has not received any request for him to make a determination of the tariff offered to CSP under the 3G licensing condition, or any complaint from CSP against discriminatory treatment of the 3G or 2G MNOs. CSPs are able to reach agreements with MNOs through commercial negotiation in a competitive environment. Therefore, the TA does not consider that there is any need to review the current regulatory mechanism.
(d) Since the TA considers that competition in the market is currently working well, reinforcing the existing regulatory mechanism is not considered necessary at this juncture. The TA will continue to monitor the market development and review from time to time the need to introduce additional regulatory measures to ensure fair competition in the market.
Ends/Wednesday, October 18, 2006
Issued at HKT 13:02
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