Hong Kong has maintained its position as a leading market with effective competition in telecommunications by adopting a more balanced and advanced approach in promoting market competition and network rollout, a competition benchmarking report says.

The report, published today by the Office of the Telecommunications Authority, compared the effectiveness of competition in Hong Kong's telecommunications market with seven other markets - Australia, Japan, Singapore, South Korea, Sweden, United Kingdom and the United States.

The report said Hong Kong had adopted a more balanced approach in promoting market competition and a more advanced approach in encouraging network rollout.

It was reflected in the Government's initiatives in implementing ex-post regulation of tariffs of the fixed incumbent operator and full withdrawal of mandatory Type II interconnection at the telephone exchange level by June 30, 2008.

Although Hong Kong has no general competition laws, the Telecommunications Ordinance appears to cover all the key anti-competitive practices covered by general competition laws in other review markets, the report said.

Consumers benefit from competition

Consumers have continued to derive substantial benefits in terms of both cost savings and an increase in services take-up.

The study reveals that Hong Kong has the highest outgoing IDD traffic in the world, rising from 585 minutes per capita in 2002 to 707 minutes per capita last year.

Among the review markets, Hong Kong also had the highest penetration rate in the mobile sector last year and the second highest broadband penetration rate - South Korea had the highest.

Hong Kong maintains its position as one of the least expensive markets for telecommunications services over the years. This, in turn, stimulates service take-up and benefits consumers.

Possible challenges

In terms of product innovation and development, Hong Kong is one of the leading markets among other review markets, as evidenced by the fact that it has the largest number of IPTV (television over broadband Internet) subscribers in the world.

The report also highlighted that the emergence of new technologies and fixed-mobile convergence would pose challenges to existing regulatory frameworks. 

OFTA said it would continue to monitor developments in the telecommunications market and bring the regulatory regime into line from time to time.

For details of the report, click here.