The total value of international telephone service revenues was HK$1,241 million in 1986-87, with 90% of the revenue coming from business users [3].
2.3.3 International leased lines
CWHK currently leases about 1850 international circuits representing approximately HK$326 million in revenues in 1986-87. The transportation and the financial services sectors are the largest user groups. Many institutions use Hong Kong as a hub; 10-20 incoming/outgoing lines are used to transmit data, electronic mail and telex, interlinked by a switching system in Hong Kong.
2.3.4 Telex and facsimile
CWHK has approximately 30,000 telex subscribers operating through two computerized fully automatic combined subscriber/trunk exchanges at New Mercury and Hermes House. Telex was first introduced into Hong Kong in 1959 and the number of subscriber lines has grown at approximately 19% p.a. over the past decade; this compares with a 9% p.a. growth in the number of leased lines. The latter are only economical for very large users who require more than 20 minutes of telex traffic per day to a single destination. The switched telex market was worth some HK$591 million in 1986-87, and is now considered as a mature market and one that will be increasingly displaced by the facsimile machine, by in-house and industry networks and by generic electronic mail services.
In international terms the growth in the volume of telex traffic has been very high in Hong Kong over the past decade, reaching three times the level achieved in West Germany, for example. At 17% p.a. growth Hong Kong was only 1.5% lower than the growth in Singapore. (See Exhibit 2.12). The number of facsimile machines in use has recently grown very rapidly, with some 33000 now in use. This is a very high per capita penetration by world standards.
Overall, HKT and CWHK have kept pace with the rapid growth in both residential and business requirements for basic international services and have expanded the network accordingly. In summary, a singularly strong telephone culture prevails in Hong Kong that offers many opportunities for the future development of new telecommunications products and services.
2.4 GROWTH AND DEVELOPMENT OF NON FRANCHISED PRODUCTS AND SERVICES
2.4.1 Transition to competition within Hong Kong
The trend towards liberalization began in the late seventies and in December 1982 the Government began a formal process of deregulation to limit the franchise and Scheme of Control to the basic telephone service.
3.
Figure for telephone revenues are net revenues less 7% Government Royalty, and net revenue is "Collection + Inpayments Outpayments. CWHK
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