ENG-2006 — Page 424

356 Communications, the Media and Information Technology

telecommunications services delivered through an advanced telecommunications infrastructure capable of supporting different forms of innovative services.

Since the introduction of competition in the local fixed network services market in 1995, operators have been actively rolling out their self-built customer access networks to provide choices and services to end-customers. By December 2006, 76 per cent of households in Hong Kong were able to enjoy a choice of at least two self-built fixed networks.

Broadband and Internet Access Services

The number of broadband accounts increased significantly during the year to 1 744 420, or 25.3 broadband accounts per 100 inhabitants, representing an annual increase of 11 per cent. In terms of household penetration, this translated into 71.4 per cent of households. Currently, broadband internet access services with access speed of up to 1 000 megabits per second in both the upstream and downstream directions are available in the market. According to reports issued by the International Telecommunication Union (ITU) in 2005, Hong Kong ranks second in Asia in terms of broadband penetration.

Mobile Communications Services

The market for mobile communications services is highly competitive. At year- end, five mobile carrier licensees were operating a total of 14 digital systems providing second generation (2G) and third generation (3G) mobile services, serving a customer base of over 9 million. This represented an annual growth rate of 9.5 per cent. The penetration rate of mobile communications services was about 137 per cent, one of the highest in the world. At year-end, the four 3G operators had acquired a customer base of 1 331 651. New services based on the high-speed downlink packet access (HSDPA) technology offering service to mobile customers as fast as 3.6 megabits per second are also available.

OFTA consulted the public and the industry in October 2006 on the issue of a mobile carrier licence for services in the 850 MHz spectrum band to enable the provision of mobile services based on the CDMA2000 standard, one of the popular mobile standards in the world, including Mainland China. By facilitating the provision in Hong Kong of a key service which is used widely around the world, Hong Kong's strategic position as a world city and the gateway between the Mainland and the world can be strengthened. Bidding is expected to take place during the fourth. quarter of 2007 upon the completion of the consultation process and the enactment of the necessary legislation.

External Telecommunications Services

The external telecommunications service market had been fully liberalised since 1999. At year-end, there were 21 external fixed carrier licensees providing cable- based external telecommunications facilities and six providing non-cable- external telecommunications facilities. Competition in the external telecommunications facilities and services markets have led to a significant drop in International Direct Dialing (IDD) call rates.

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