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The Telecommunications Authority today (April 27) announced the conclusions in the consultation on "Deregulation for Fixed-Mobile Convergence".
"With a dynamic market and technological developments, the distinction between fixed and mobile networks and services is becoming increasingly blurred," a spokesman for the Office of the Telecommunications Authority (OFTA) said. "Under the market-driven approach which has been adopted by the Hong Kong Government for the telecommunications industry, Fixed Mobile Convergence (FMC) or the extent or pace of it in Hong Kong should be properly determined by the market. The role of the authority is to ensure that the regulatory environment is conducive to the development of new technologies, products and services. Operators should be able to respond promptly to consumer demand for FMC or technological advances promoting FMC without unnecessary regulatory constraints.
"One of the conclusions of the review is that there should be withdrawal of the current regulatory guidance which assumes an approach of 'Mobile Party's Network Pays' (MPNP). There will be a two-year transitional period to enable concerned operators to adapt to this change. The effect of this deregulation will be that the level of interconnection charge and payment arrangements will be a matter of commercial negotiations among the operators.
"However, the authority retains his statutory powers to make a determination on interconnection terms under section 36A of the Telecommunications Ordinance if agreement cannot be reached," the spokesman said.
Under the existing MPNP interconnection charging arrangement which resulted from regulatory guidance introduced in the 1980's, mobile network operators are required to pay interconnection charges in both directions to the fixed network operators. In other words, regardless of whether a mobile user calls a fixed user or vice versa, the interconnection charge is always borne by the mobile operator.
"The current local access charge (LAC) arrangement for interconnection between external service providers and fixed/mobile network operators will be maintained. The authority will monitor whether the removal of the regulatory guidance on fixed-mobile interconnection charge (FMIC) is likely to have the effect of making the origination or termination of external calls more competitive before considering whether to propose any further de-regulatory measures in relation to LAC," the spokesman said.
The authority also reviewed the feasibility of introducing Fixed Mobile Number Portability (FMNP). However, he concluded that a market survey should first be conducted to assess the consumer demand for FMNP before making any further proposal on its introduction in Hong Kong.
The authority will also recommend to the Secretary for Commerce, Industry and Technology the introduction of a Unified Carrier Licence (UCL) which can authorise the provision of fixed and mobile services under the same licence.
The authority initiated a review of FMC related regulatory issues by publishing a consultation paper on September 21, 2005. The principal focus of that paper was to solicit public views on the proposed introduction of the Unified Carrier Licence.
OFTA subsequently engaged a consultant to identify and study the regulatory changes that may be warranted in the light of FMC. Having considered the recommendations of the consultant and the feedback from the first consultation, the authority set out preliminary views and proposals for regulatory changes in a second consultation paper issued on July 14, 2006. The authority invited further views and comments from the industry and the interested parties on the matters covered in the second paper. A total of 23 submissions were received.
After considering the submissions received, the authority announced his conclusions in a statement published today. The statement can be downloaded from OFTA's website at http://www.ofta.gov.hk.
Ends/Friday, April 27, 2007
Issued at HKT 17:26
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