Hint of compromise in controversial 3G plan

date: 12th January 2001, source: scmp.com

The Government appeared to be weakening on Wednesday on a controversial plan to force third-generation (3G) mobile telecommunications licence winners to open up 30 per cent of their networks.

"We will not make a [final] judgment until there is no need for further consultation," Au Man-ho, a senior assistant in the Office of the Telecommunications Authority (Ofta), said in response to strong opposition to the proposal expressed at a hearing on Friday by industry players.

Hutchison Telecom, the largest local mobile operator with 1.6 million subscribers, expressed concern over the mandated opening up of the 3G networks, claiming that the proposal would favour new operators and make its business model unpredictable.

Hutchison is yet to decide whether it wants a licence.

Mr Au said it was a commercial decision for a company to decide whether to go ahead with its investment. The job of Ofta was to make rules clear.

"The purpose of the regulation is to ensure an open network that will allow small-to-medium companies to play the 3G market," he said.

"Whether or not to mandate will depend on whether the industry can maintain an open network without intervention."

Mr Au added that Ofta seldom stepped into the market to arbitrate.

While the level of opening up a network was "not negotiable" at this stage, Mr Au said there were some suggestions to consider.

He said that Nokia representatives had explained the way the spectrum was leased to MVNOs (mobile virtual network operators) in Europe.

"And that is what we will consider," Mr Au said.

Nokia claimed less than 10 per cent of the spectrum was leased to MVNOs in Germany and Britain after the 3G auctions.

That represented a large difference from Ofta's proposal to open up 30 to 50 per cent of a network.

Sunday Communications managing director Craig Ehrlich said Ofta's proposal made sense. "There is just a major player aggressively lobbying for less competition," he said.

Ofta expects to detail the 3G proposal in February.

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