28.
29.
ten people in each category what is likely to be available through local recruit- ment. This will add to staffing costs and overheads.
Competitive spirit.
28.1. In our view, this category has emerged as an important factor in the anticipated performance of the bidders.
28.2. At an early interview attended by the consultants and representatives of ASIB, HKCC professed that it was unrealistic to compete head-on with TVB for a share of the prime time market using products at which TVB had already shown itself very successful (variety and drama). They therefore advocated a strategy of complementing TVB's efforts. They also proposed extensive use of TVB and Shaw Studio facilities in the early years of their operation, together with use, on a commercial basis, of TVB's staff training programme.
28.3. At a subsequent interview they had clearly recognized the risk to their chances that a close association with TVB represented, and they therefore issued a “clarification" that TVB's role extended only to being advisers in the pre-tender period: there would be no further TVB involvement, other than possibly as landlords of leased premises at Clearwater Bay. In addition, they stated that they firmly intended to compete on all fronts with TVB.
28.4. HCV has proposed to compete directly with TVB and ATV, and are design- ing some of their initial drama and variety offerings to draw audience attention (if not specifically viewership ratings) away from TVB. Their initial marketing strategy calls for a limited number of offerings which will rouse public comment and thus increase peer-pressure to subscribe to cable.
Confidence in their own ideas
29.1. It has become clear both from the proposals received and from perform- ance at subsequent interviews that HKCC is concerned to be seen "to be doing the right thing" by the Government and B.A. In particular, HKCC is very quick to modify any proposal in the light of any appearance of disfavour from Government.
29.2. HCV has been more robust in this respect; however, it is anticipated on the basis of their attitude to probing by Government and consultants, that they would take a very tough negotiating position if they believed they would get the fran- chise.
Conclusions and Recommendations
30. Of the four bids received on 28 February 1989, we find that only two bids qualified. These were the proposals submitted by HKCC and HCV.
31.
The proposal submitted by Supertech was deficient in providing no data on market assessment, programming, finance or implementation. The proposal submitted by Windows was deficient in the area of implementation, and supplied very scanty data on market assessment, programming and finance. Windows submitted a large volume of un- solicited, additional data an 13 April. We object on principle to assessing their bid on the basis of this additional information. In addition, we note the advice of the consultant that, even with the additional data, the bid is deficient and does not measure up to those received from HKCC and HCV.