4.3
4.3.1
PROVISION OF INTERNAL TELECOMMUNICATIONS SERVICES (SCENARIO 4)
General description
A second network carrier in Hong Kong offering local telecommunications would need to build a network which would include all the elements of a modern telecommunications system. On the technical side, "local loop", switching equipment, trunk/junction transmission systems, a network management centre, a billing system and interfaces to the existing domestic and international networks would all be required. "Local loop" could be provided by means of conventional twisted pair, microwave transmission or optical fibre systems. The network would be entirely digital from the start, and it is likely that a second carrier would therefore favour digital systems such as microwave radio and optical fibre over the more conventional analogue twisted pair system.
Furthermore, the second carrier would require an organization which would include technical staff, operational staff, sales, administration, and general management staff and, all of the associated overheads (including equipment, buildings, office space, and vehicles).
Given the targeted market of the business community, and the fact that the cable television network is focused at providing service to the residential areas, BAH concludes that there is very little sharing of costs between a second telecommunications network and a cable television network. The two areas of costs in which savings would be realized are in the fibre optic network and in the hubs of the cable distribution system. BAH has examined the planned service areas of the second telecom network, and has concluded that at most 52% of the fibre network of the cable television supertrunk would be required to satisfy the long term requirements of the telecommunications network. Similarly, approximately two thirds of the hub sites of the cable television network would be needed by the telecommunications network.
In scenario 4, the network of scenario 2 is extended to serve the telecommunications needs of the commercial sectors. Residential buildings will only have access to the new network via the existing HKT network. In the time period covered by the study, 1987-2007, it would only be economic to provide service to those buildings which would have more than 700 lines. BAH forecasts a penetration of 100 buildings in the first year, 70 in the second year, and then an initial growth of 15 buildings a year, slowing down to 5 new buildings a year by the year 2007. The cost of scenario 4 was analyzed as the incremental cost over that of scenario 2 and as an incremental amount over scenario 1. costs are separated out as follows:
Capital Costs:
The fibre optic network
* The fixed cost of equipping a building
* A per line cost for serving a building
* Switching equipment
* Billing system
The
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