Although the WTS consortium did well to strengthen its proposal quickly, the proposal is still considerably weaker than HKCC's or HCV's.
Its programming line-up does not provide the same variety and relies very largely on foreign feeds.
Its network is dependent on HKTel to an extent greater than the Government intends. Apart from general information on network capacity and structure, WTS does not provide more than a conceptual network plan. The information provided is inadquate for a technical evaluation.
Its network appears to be under-costed.
The financial estimates are not sufficiently detailed to enable us to assess the feasibility of their approach.
The cable TV project proposed for Hong Kong is unique in several respects:
the amount of new programming involved;
the vertical integration between the programming organisation and the cable TV network operator; and
the intention from the outset to provide a broad range of competitive telecommunications services using a parallel network.
This uniqueness, coupled with the fact that Hong Kong's cable TV network will be among the largest in the world, means that the project has considerable risk. The main elements of risk have been carefully considered and the HKCC and HCV financial plans can accommodate reasonable deviations, but the combination of serious shortfalls in key areas would lead to failure in meeting the Government's objectives. To reduce this risk, Government will need to remain actively involved in reviewing the progress of the project. Elements that the Government might want to review include: build rate, disruption, progress on programming and financial performance. Various milestones need to be established by Government during negotiation and monitored during implementation.
2.
Telecommunications
Both HKCC and HCV would provide viable telecommunications services aimed at serving the business community. However, what they provide will depend on market demand and Government policy, and they may not necessarily follow the plans outlined in their proposals. HCV, however, has a better understanding of the market for telecommunications services in Hong Kong. Their proposal benefits from market research and they have been more specific about the services they propose to offer. A key local member of the HCV
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Arthur D Little
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