TA Announces Completion of the Grant Stage of the Auction for 3G Licensing

date: October 22, 2001

The Telecommunications Authority in Hong Kong announced that the Grant Stage of the Auction for the 3G mobile services licensing had been completed today, with the award of four licences to successful bidders in the Auction. They are Hong Kong CSL, Hutchison 3G HK, SmarTone 3G and SUNDAY 3G (Hong Kong).

"All stages of the Auction for 3G Mobile Services Licensing have now been successfully completed. The issue of 3G licences will allow Hong Kong to enjoy 3G services at the same time as other advanced economies. The licensees may now start to roll out their networks and I believe Hong Kong is well positioned to be a world centre for 3G innovation," said Mr Anthony Wong, the Telecommunications Authority.

SUNDAY 3G did not provide a performance bond in time, but offered, in lieu of the performance bond, an upfront cash payment of $250 million to cover the spectrum utilization fees for the first five years after licensing.

"I have considered the special circumstances of SUNDAY 3G. I consider that it would be in the public interest to award four licences promptly to ensure competition in the market. The risk to the Government would actually be reduced with the upfront payment in place of a performance bond and the Government will earn additional interest. SUNDAY 3G's licence obligations in all other respects, remain the same as those of the other 3G operators," said Mr Wong.

"We also publish today the guidelines for the application of Public Non-exclusive Telecommunications Service (PNETS) licences for operating MVNO service. All interested parties can now apply for the licences for MVNOs," Mr Wong added.]

The guidelines for PNETS licences have been revised to include the new MVNO licence. They give an overview of the regulatory framework of MVNOs services under PNETS licence, set out the licence conditions as well as the procedure of the licence application.

In accordance with the regulatory framework of open network access, the 3G licensees are required to open up at least 30 per cent of their capacity for use by non-affiliated MVNOs and/or content and service providers. This requirement promotes entry, ensures a competitive and vibrant 3G market and preserves a level playing field for all operators to compete with.

"We are confident that with the transparent and balanced regulatory regime for the operation of MVNOs, Hong Kong is well placed to reap the full benefits of the new generation of mobile services. Consumers will enjoy more choices and innovative services," Mr Wong explained.

As for the 2G licences, the TA also announced that an extension of three years has been granted to the five existing 2G licences operating in the 800/900MHz today. This brings the expiry dates of their licences close to the other six 2G licences operating in the 1.7 - 1.9 GHz bands in 2006.

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