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Speech of the Secretary for Information Technology and Broadcasting at the Press Conference on Licensing of Third Generation Mobile Service (3G)

September 19, 2001

We received four applications for 3G licences in Hong Kong and in accordance with the rules set out in the Information Memorandum, these parties have each been provisionally awarded a licence at reserve price i.e. 5% royalty subject to a minimum payment of $50 million for each of the first five years, and rising minimum payments from year six onwards. The rules state that if there are four or fewer bidders then we shall award the licences at reserve price. Our auction design which aims to ease the financial burden for licensees is quite unprecedented. It is an efficient, fair and transparent way of awarding licences. We have achieved our objectives.

We welcome the result of the auction because both the number of licences and the price have been determined by the market.

Today is an important milestone for the development of Hong Kong's telecommunications industry. I believe Hong Kong is well positioned to offer cutting edge 3G services and content. This licensing exercise is only the start.

The innovative open access regime that Hong Kong has chosen also means that those who don't get to operate the network will still have the chance to participate in 3G services as MVNOs. So in a way, like the provisional successful bidders, everyone is a winner.

Now I'm sure you are anxious to find out more about the winners. So I will hand over to the Telecommunications Authority, Mr Tony Wong, who will run you through a short presentation. After that, we'll both be delighted to answer questions.