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The Office of the Telecommunications Authority (OFTA) issued today (June 20) a report on the effectiveness of competition in Hong Kong's telecommunications market, as benchmarked against seven markets -- Australia, Japan, Singapore, South Korea, Sweden, United Kingdom and the United States. The study was undertaken by a consultant commissioned by OFTA.
A spokesman for the OFTA said, "This is the first international benchmarking study on market competition commissioned by OFTA. The study establishes that Hong Kong is a leading market in terms of effectiveness of competition in the telecommunications market," the spokesman said.
The study assesses the effectiveness of competition by comparing a range of objective competition indicators with comparable overseas economies. The scope of the study includes the local fixed voice sector, mobile sector, data access (i.e. broadband services) sector and international services sector. It focuses on four key competition issues, including (i) competition environment and regulatory framework, (ii) development and effectiveness of competition, (iii) consumer benefits derived from competition and (iv) industry investment.
"We have the most competitive mobile sector as compared with the other seven review markets. In the local fixed voice sector and the international services sector, new entrants have gained significant increase in market shares during the past few years," continued the spokesman. This is the outcome of liberalization policy as well as pro-competition regulation, such as Type II interconnection, mobile number portability and a new licensing framework of mobile virtual network operators.
Consumers have derived substantial benefits in terms of both savings in cost of telecommunications services and increase in take-up. The cumulative savings resulting from competition in the mobile market are estimated to be HK$70 billion for the period from 1996 to 2002. Savings from IDD call rates for the period from 1999 to 2001 amounts to an estimated HK$31 billion. Hong Kong also has the highest mobile penetration rate, and the second highest broadband penetration rate after South Korea among the review markets.
"Hong Kong is one of the least expensive markets for telecommunications services. This, in turn, stimulates service take-up," highlighted the spokesman.
"Hong Kong enjoys high level of investment in telecommunications. The cumulative investment per capita during 1991-2001 is around HK$14,000. It is higher than five other review markets, similar to UK and second to Japan only," the spokesman elaborated. With the substantial investment, operators have been able to deploy advanced networks and deliver innovative products and services to end-users.
"We shall conduct similar studies every two years to ensure that Hong Kong maintains our competitiveness internationally," the spokesman concluded.
The report of the study, in both Chinese and English, can be downloaded from OFTA's website at http://www.ofta.gov.hk/.
End/Friday, June 20, 2003
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