TNAG-0350-FCO40-386-Future-of-broadcasting-in-Hong-Kong-1972 — Page 144

CONFIDENTIAL

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XCC(72)14

Establishment of further wireless television services

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Competition is examined in Chapter 13. Having concluded that the considerations which justified TVB's initial wireless monopoly will no longer hold good when TVB's licence is due for renewal the working party regards competition as essential in order to provide viewers with a choice of programmes and so as to maintain standards (recommendation 53). Ironically the very success of wireless television, established partly to provide competition for Rediffusion, has meant that true competition has not been achieved although there is no doubt that Rediffusion's wired service has improved since the advent of TVB.

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The need for competition, however, is not seen as being fulfilled merely by the provision of two new services to compete with TVB's Chinese and English services and the licensing of a third Chinese service is considered necessary as soon as the second licensee has been given sufficient time to become established (paragraph 273 of the report). On the other hand it is considered that, having regard to the small demand for English language services, the need for competition is satisfied by the provision of only two services (recommendation 43). It is proposed that licensees should be permitted to use their English services for the daytime transmissions of ETV programmes (recom- mendation 44) but that any suggestion for bilingual sound transmissions for the English services would require further consideration (recom- mendation 45).

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As to the types of services to be provided the working party has strong objections to pay-television for entertainment program- mes (recommendation 54) but considers that the provision of vocational training by this means could be a valuable use of television once the first priority of establishing competition for TVB's services has been achieved (recommendation 55).

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Having reached a conclusion on the number and type

of services it considers desirable in the public interest and having established (paragraph 21 above) that there are sufficient frequencies available for their transmission the working party then examines whether sufficient advertising revenue is likely to be available for these services to maintain satisfactory standards (and for licensees to be able to obtain in time a reasonable return on their investment).

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The licensing of a second wireless television station will very probably lead to a reduction in advertising rates and the working party recommends an increase in the permitted advertising times from the present 7 minutes in any one hour to 10 minutes per hour subject to an overall restriction of 10% of transmission time in any 24 hour period (recommendation 46). Referring to the already existing disparity in ad- vertising times applicable to TVB and Rediffusion (paragraphs 200-208 of the report) the working party does not consider that there will be any objection from the public to a relaxation of the existing restrictions. It recommends, however, that the position should be kept under review by the Television Advisory Board.

CONFIDENTIAL