3G re-auction would harm users: Hutch HK CEO

Fiona Chau
20 Mar 2013

The Hong Kong government is under attack again with its proposed plan to seize and auction off a third of 3G spectrum currently in use. Hutchison Telecommunications Hong Kong has slammed the proposal as a move that would “rob” both consumers and mobile operators.

Hutchison Telecom CEO Peter Wong said the Communication Authority’s proposal to re-auction 3G spectrum is “unfair and unnecessary” and it would not bring in competition, but service disruptions and higher charges.

“We’re not afraid of competition. We’ve been operating our business in a highly fierce market for more than a decade,” he said. “We’ve been invested a lot of money in telecom infrastructure and helping consolidated Hong Kong’s position as a telecoms hub in Asia and providing consumers with high-quality telecom services at the world’s cheapest prices.”

If the government decided to re-auction the 3G spectrum, he said, mobile operators might need to bid for the spectrum with astronomical prices.

And the increased costs would inevitably be passed on to consumers.

“It’s like that we [mobile operators] are used and dumped [by the government] and the government is robbing both consumers and mobile operator,” Wong noted.

Wong’s comment echoed rival SmarTone, which claimed earlier that the re-auction of 3G spectrum would affect its network capacity and the company would need increase network costs by as much as 40%. SmarTone CEO Douglas hinted that the operator may raise its mobile charges as early as the end of year, if the 3G spectrum were reauctioned.

In the industry consultation conducted by the Communications Authority last year, the regulator hasproposed three options for what to do with spectrum once the operators' existing 3G licenses expire in 2016. The first involves reallocating the licenses at a set fee, the second involves re-auctioning the entirety of the spectrum, and the third is a hybrid approach between the two.

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