TNAG-1592-FCO40-2177-Appointment-of-Sir-David-Wilson-as-new-Governor-of-Hong-Kong-1987 — Page 92

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6.

Cable Television

6.1

6.2

6.3

6.4

A Broadcasting Review Board reported in August 1986 on a wide range of issues relating to future broadcasting policy for Hong Kong. In reference to cable television, the Board recommended that "in the public interest, prospective cable television operators should be encouraged to enter into a joint venture with Telco or use RTV cable ducts, and that "the Telecommunications Authority should arbitrate any dispute over technical feasibility or charges by Telco for provision of the cable". The Board further recommended that tenders should be invited for a single television cable service for the whole of Hong Kong.

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For the Hong Kong Telephone Company, cable television was seen as simply another service capable of being carried on its developing telecommunications network and submissions to this effect were made to the Broadcasting Review Board. Hong Kong Telephone of its own initiative and with the use of its network in mind, formed a consortium with other interested parties and applied to Government for permission to launch a cable television service. Hong Kong Telephone of course has no experience of the entertainment industry and its role in this consortium was always that of seed-corn provider with the ultimate intention of reducing its shareholding down to a minority level. Telco's current shareholding is 40% of the consortium. Agreements are near completion to dispose of a further 10% and another 10% is under discussion with interested parties.

Subsequently Government sought expressions of interest from parties interested in providing a cable television service. Various proposals were received with one other consortium emerging as the principal competitor to the consortium with which Hong Kong Telco is involved. This other consortium has as its major shareholders the Hutchison Group and British Telecom, and although professing an interest in cable television, the consortium has made no

secret of the fact that its primary objective is to lay its own network in Hong Kong upon which not only cable television would be carried but also other telecommunications services. The consortium has further stated that if it could not have its network it would not be interested in providing a cable television service. Having regard to the technological issues discussed in paragraph 5. above, such a network would compete directly with that of the Hong Kong Telephone Company and would have the capability of providing practically any telecommunications service including telephony.

Own

In the course of intense lobbying and publicity, the Hutchison/BT consortium have made numerous exaggerated and misleading claims including the suggestion that Hong Kong Telephone's franchise should be cancelled. They have argued that competing networks would be in Hong Kong's best interest

interest and that the Hong Kong business community are not getting the modern services that they deserve from Hong Kong Telephone (by inference they would be available from the Hutchison/BT consortium). In frequent letters to Hong Kong newspapers and other public appearances it has been claimed that Hong Kong Telephone's network is not suitable for cable television, and that Hong Kong Telephone are therefore misleading the public and the Administration. Hong Kong Telephone's response has been to indicate that everything it says is capable of independent audit, and that a single universal network in a territory the size of Hong Kong is in the best public interest.