Spectrum is an important resource used for the provision of a wide range of services from telecommunications, broadcasting to meteorology and aviation. The use of spectrum in Hong Kong has always been managed by the Government primarily to promote efficient allocation and to prevent one spectrum user from causing unacceptable interference to another.

With the rapid advancements in radiocommunications technologies and dynamic market developments, it is increasingly difficult for the Government to possess all the relevant information, particularly market information, needed to make judgements on what is best for the community.

In recent years, some overseas advanced economies have moved away from the "command and control" approach towards market-based arrangements for spectrum management. Furthermore, the industry in Hong Kong has expressed a wish for more clarity and predictability in spectrum rights and supply to enable them to make better-informed investment decisions.

With the above considerations in mind, we undertook a fundamental review of the current spectrum policy. The aim is to formulate a responsive and transparent spectrum policy that enables the community to reap the maximum economic benefits from the deployment of spectrum. Today, we will be launching a public consultation on the proposals for the policy framework.

Under our proposals, the policy objectives for spectrum and the guiding principles for spectrum management would be more clearly articulated. One of the policy objectives would be to strengthen Hong Kong's strategic position as a world city and gateway between the Mainland of China and the world by facilitating the provision of key services in Hong Kong which are, or will be, deployed globally or on the Mainland of China. Market-based approaches should generally be used for spectrum management. 

Another policy objective proposed in the consultation paper is to encourage maximum utilisation of the allocated spectrum. Spectrum management mechanism should also become more transparent in respect of spectrum supply and rights. So we will mention spectrum trading as an area for further study.

Given that spectrum is no more than a means to support a multitude of services, from communications to aviation or from meteorology to broadcasting, a policy on the management of spectrum should not be confused with the policies in these respective spheres.

We welcome views from you and the public in the coming three months on the proposals in the consultation document which we will upload to our website this afternoon. Our aim is to put in place a spectrum policy which is on par with best international practices, and attuned to the unique situation of Hong Kong.

Consistent with our business-friendly philosophy embedded in our policy, we have always strived to provide the industry with a regulatory environment conducive to innovation and investment. We opened up our TV market in 2000, and have since then put in place a very light-handed regulatory regime for the broadcasting industry.

Unlike most economies, we have no foreign investment limit, no restriction on business models and no local content requirement on the provision of pay TV services. And we certainly do not precensor broadcast content. All these give us a headstart in the era of digitisation and convergence.

I am glad that Hong Kong, together with Japan, ranked first on regulatory effectiveness in CASBAA's study last year. This study shows that our regulatory effectiveness has in fact led to significant investment in the pay TV industry over the years.

We are also among the first jurisdictions in the world to embrace technical neutrality in regulating TV services. This horizontal, technology-neutral approach allows changes to regulation of conveyance and content to occur at a different pace; and it has been facilitating media convergence on a single platform.

A vivid example is IPTV. We have not nor did we ever propose legislation for IPTV to be introduced. As a result, we have witnessed the world's first and largest commercial IPTV deployment in Hong Kong. Now, three out of four pay TV operators in Hong Kong are providing IPTV.

More than 27% of Hong Kong households are enjoying IPTV services over the broadband network, with some 200 programme channels available at a price of as low as $5 (64 cents in US dollars) per channel per month on an a-la-carte basis. This is unprecedented anywhere else in the world. One Hong Kong company is in fact exporting its IPTV expertise and experience to other economies in Asia-Pacific and Europe.

However, we are not complacent and are indeed bracing ourselves to meet the challenges ahead in the increasingly convergent environment. The two immediate challenges are the establishment of a Communications Authority and the Government's role in promoting the development of mobile TV services in Hong Kong.

On the first challenge, we have completed our consultation exercise. In the light of favourable response from the industry, we will introduce legislation in the current legislative session to merge the existing Broadcasting Authority and Telecommunications Authority to form a unified regulator, called the Communications Authority, for the whole electronic communications sector.

On the second challenge, we believe Hong Kong is best placed to nurture the growth of mobile TV services given our ultra-high mobile penetration, one of the highest in the world and close to 130% at this moment.

We also believe in putting in place a business-friendly regulatory framework accompanied by an appropriate spectrum-allocation arrangement. We are considering the way forward and will consult the community and the public on our proposal. In the process, we will make sure that Hong Kong continues to be one of the forerunners in adopting leading TV broadcasting technologies.

We understand that copyright infringement is one of the major threats faced by the broadcasting and content production industries.

With the development of the broadband infrastructure and the emergence of file-sharing technology, distribution of copyright works in the digital environment has become more expedient and effective than ever before.

It is important that the digital platform of Internet reward rights owners for their works, and not act as a shelter for piracy activities. To deal with the problem of Internet piracy, the Government has been adopting a multi-pronged approach which encompasses legislation, enforcement and public education. 

In addition, we will review whether and how our copyright law should be amended to give a more effective copyright protection in the digital environment. We plan to launch a public consultation on the subject by the end of this year. The broadcasting industry, as one major member of our creativity forces, will be much welcome to give views on the subject.

In relation to reception of foreign satellite television services not licensed in Hong Kong, CASBAA is currently taking legal action against some pubs for showing in public World Cup 2006 matches carried by unlicensed foreign satellite television services. We welcome CASBAA and copyright owners taking civil action against those who have infringed their copyright, and we will consider what can be done to further facilitate copyright owners in their civil action.

At the upstream level, we will continue to vigorously enforce the law to control the supply of decoders to receive unlicensed foreign satellite television services.

We are also taking stock of the situation in Hong Kong and study overseas legislation to assess if further actions on the part of the Government to tighten the control of the use of such decoders for commercial purposes are justified.

Apart from formulating and practising sound regulatory policy, the Government also sees its role as assisting the industry to explore market opportunities.

Hong Kong is a small market for content production and distribution. Geographically and culturally, it is crystal clear we should tap the potential in the adjacent huge market in the Mainland in general and the Cantonese-speaking market in the Pearl River Delta region in particular.

Under the Mainland and Hong Kong Closer Economic Partnership Arrangement, or CEPA, we have been seeking greater market access for Hong Kong-originated or Mainland-Hong Kong co-produced movies and TV dramas.

Hong Kong films can now be imported for distribution in the Mainland on a quota-free basis, the ban on broadcasting co-produced TV dramas in Mainland during prime time has been lifted, and the mechanism for approval of co-production of TV dramas has been streamlined. We shall continue our efforts towards more liberalisation under CEPA.

This is excerpted from an address Secretary for Commerce, Industry & Technology Joseph Wong gave at the opening ceremony of the Cable & Satellite Broadcasting Association of Asia Convention 2006.