TNAG-1987-FCO40-2820-Presentation-of-UK-policy-on-Hong-Kong-to-the-media-1989 — Page 6

in

telecommunications.

objective of encouraging competition Lack of financial detail

prevented an assessment of the viability of the proposal, although in ADL's

in ADL's view the WIS network was under-costed. On programming, ADL concluded that the proposal lacked variety, relying very largely on

largely on overseas

sources.

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both HKCC

network

that

The overall conclusion of ADL's evaluation was

and HCV would be able to meet Government's objectives for the cable television/second network project, but that the WTS second proposal would not. In ADL's view both HKCC and HCV could provide a full range of high quality programming; both proposals would result in economic benefits from increased telecommunications competition and would stimulate the information services industry by making а greater range of telecommunications services available at cheaper rates. However, solely with regard to the factors covered by its evaluation, ADL considers the HCV proposal to have an edge

an edge over the HKCC proposal. ADL' preference for HCV rests on a number of factors, which are based on judgement. In particular, ADL considers that the HCV programming in the early years is more attractive; its implementation plans are more detailed; it has a greater understanding of the local telecommunications market and regulatory environment; and it would be a more aggressive telecommunications competitor.

The Administration's Assessment

Broadcasting Aspects and Corporate Structure

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We have worked closely with the BA in the assessment of the broadcasting aspects of the four bids, and we have provided the BA with all the information it requested.

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The

believes

that,

a

Administration

from broadcasting point of view, the proposals of Supertech and WIS are inadequate and should be rejected. Of the remaining bids, HKCC and HCV, neither has an overwhelming advantage in any area: both could

could provide a competent CTV broadcasting system attractive to Hong Kong consumers. encountered in the recruitment of sufficient personnel and talent, and this may have some on the system, but such problems would be either bidder if successful and should not jeopardise the long term success of the system.

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Problems may be skilled creative adverse effect encountered by

While the Administration endorses the recommendation of the Broadcasting Authority that both parties are qualified but that HCV is somewhat ahead, we are nevertheless mindful that HCV's edge can

edge can only be considered marginal. This is