ENG-2005 — Page 433

Communications, the Media and Information Technology | 375

announcement of the regulatory framework for IP telephony in June 2005 with a view to creating the service-based licence for provision of IP telephone services in January 2006 was a good illustration of the Government's efforts to facilitate the development and introduction of innovative services in the telecommunications market.

At the customer access level, there will also be convergence between fixed and mobile services. The current regulatory framework which demarcates fixed and mobile carrier services with different regulatory arrangements may need to be revamped to align it with technological and market development. A consultation paper proposing a unified licensing framework that suits carriers using different types of access technologies was issued in September. In December, a study was initiated to analyse the costs and benefits to stakeholders and the community from possible changes to other regulatory arrangements, such as fixed-mobile interconnection charging and number portability, which may need to be revised to cope with fixed-mobile convergence at customer access level.

The Government is considering allocating spectrum for the provision of broadband wireless access (BWA) services in the light of recent developments in BWA technology and standards. Apart from its ability to provide a broadband wireless connection to subscribers, thereby substituting wireline links, it is anticipated that BWA technologies will eventually embrace full mobility capabilities, enabling consumers to gain access to a wider choice of innovative services under a fixed-mobile convergence environment. Two public consultations on the licensing framework for possible deployment of BWA in the 3.5 GHz band were conducted in December 2004 and August 2005.

Rapid advances in broadband technologies and the increasing convergence between telecommunications and broadcasting have created opportunities for telecommunications operators to offer IP television (IPTV) services. A number of fixed telecommunications network operators have entered the IPTV market and are now offering triple-play products (telephony, broadband Internet access and IPTV) to their customers. With over 500 000 IPTV subscribers, Hong Kong is regarded as the most advanced IPTV market in the world.

Local Fixed Telecommunications Network Services

Businesses and consumers in Hong Kong enjoy an excellent telecommunications infrastructure. In 2005, the telephone density was 92 exchange lines per 100 households, one of the highest in the world.

The local fixed-line market has been fully liberalised since January 2003. Under the full liberalisation policy, there is no pre-set limit on the number of licences issued, or the timing for submission of applications for licences. By year-end, there were 10 local wireline-based fixed-line licensees and one local wireless-based fixed-line licensee. Under the technology-neutral regime, a licensee may use any technology provided that the technology conforms to an open and non-proprietary standard and for which there is a reasonable choice of consumer equipment in the market.