the Broadcast Drive site of ATV (and that of TVB) is subject to a a normal New Territories Land lease expiring in 1997 and now renewable until 2047, while the lease conditions permit the company on expiry of its licence to redevelop the residential use. If ATV were not new licence it may consider profitable to redevelop its site rather than sell it to an incoming licensee;
site for awarded a it more
if ATV were not granted a new licence, the Government could in theory exercise its right of compulsory purchase of ATV's site and studios and transfer them to а new licensee. It would, however, be necessary to defend the decision to dispossess ATV of its facilities in order to sell them to another (and untried) broadcasting Moreover if the Government purchase ATV's site it would have to pay the full residential price for it;
company.
wished to
as noted above, ATV's site and studios are small and ill-equipped. If a licensee did
take over ATV's studios it would almost certainly need to re-equip them, which could result in the disruption of its broadcasting services.
A Short Term Licence Extension
47
The practical difficulties of holding an open licence tender have been described above.
If a decision is made to hold an open tender, the only way to make such a tendering exercise genuinely competitive will be by providing enough time for any new licensee to obtain a new broadcasting site.
A two or three year
extension of the existing television licences would meet this requirement, on which basis it would be possible to hold a competitive tender before the end of 1987.
Disadvantages of a Short Term Licence Extension
48
Although as noted above a short term licence extension would solve some of the difficulties relating to land for a new broadcasting licensee, there
some disadvantages associated with a short-term extension.
The principal disadvantage is that an outgoing licensee may feel itself under less obligation to maintain its programming or technical standards during the remainder of its licence period, leading to potentially serious regulatory problems. There is a further risk that an outgoing licensee would choose
would choose to give up its broadcasting licence and redevelop its site prior to the expiry of its licence or the commencement of the new licensee, leaving Hong Kong temporarily with only one television station.
CONFIDENTIAL
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