Following is a question by the Hon Starry Lee and a written reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (November 29):

Question:

     In the Policy Address she delivered recently, the Chief Executive has proposed that "the Government takes the lead to provide telecommunications companies with financial incentives in the form of subsidies to encourage the extension of fibre-based network to villages in remote locations. The plan will cover about 380 villages currently without high-speed broadband network coverage and is expected to benefit nearly 170 000 villagers" (the village fibre network plan). On the other hand, there are at present quite a number of tenement buildings in urban areas having access to fixed network broadband service (FNBS), which is provided by a single FNBS operator and has an Internet access speed of 8 Mbps only, but the operator concerned charges users in these tenement buildings, owing to a lack of competition, a service fee which doubles that other users are charged. In this connection, will the Government inform this Council:

(1) of the details of the village fibre network plan, including the names of the villages involved, the estimated expenditure and the implementation timetable;

(2) whether it knows the number of tenement buildings currently not covered by fibre-based networks and the number of residents in such buildings (with a breakdown by District Council district);

(3) whether the authorities will make reference to the village fibre network plan and formulate measures to encourage FNBS operators to extend their fibre-based networks to tenement buildings; if so, of the details; if not, the reasons for that; and

(4) whether the authorities will examine the inclusion in the licence conditions a requirement for the licensees to extend their fibre-based networks to tenement buildings upon the renewal of licences or issuance of new licences for FNBS operators; if so, of the details; if not, the reasons for that?

Reply:

President,

     At present, the progress of extending network coverage by fixed network operators (FNOs) to villages in remote locations in the New Territories and the outlying islands is slow and unsatisfactory due to the high costs of network installation and the small number of subscribers. In line with the "people-oriented" philosophy of the current-term Government, the Chief Executive proposed in the Policy Address that the Government would take the lead to provide FNOs with financial incentives in the form of subsidies to encourage the extension of fibre-based networks to villages in remote locations for provision of high speed broadband services to villagers.

     Our reply to the four parts of Member's question is as follows:

(1) The subsidy scheme will cover nine districts (including Islands, North, Sai Kung, Sha Tin, Tai Po, Tsuen Wan, Kwai Tsing, Tuen Mun and Yuen Long) targeting those villages which currently have access only to basic broadband services at a speed of 10 Mbps or below. The Office of the Communications Authority (OFCA) has already commenced preparatory work for the subsidy scheme, including requesting FNOs to provide information on their current network coverage, technical standards, network extension plans and the relevant network design, etc., with a view to assisting in the formulation of the details of the scheme (including finalising the list of villages to be covered by the scheme, requirements on the fibre-based networks and broadband services to be offered, form of subsidies and implementation timetable).

     The scheme will be implemented through tender by district, and FNOs will be invited to submit bids for the tenders. Separately, FNOs receiving subsidies will be required to open up part of the newly installed underground facilities and fibre-based networks for other FNOs to use so as to introduce competition.

     We plan to consult the relevant District Councils and the Panel on Information Technology and Broadcasting of the Legislative Council (LegCo) in the first half of 2018, and seek approval of the Finance Committee of the LegCo for the necessary funding for the scheme subsequently. Once the scheme is approved by the LegCo, tendering work by district will commence immediately to enable the villagers in relevant locations to enjoy high speed broadband services as early as possible.

(2) At present, over 80 per cent of the residential units in Hong Kong (about 2.3 million residential units) are covered by fibre-based networks. OFCA does not have information on the number of buildings without fibre-based network coverage by age of buildings.

(3) & (4) The reason for some old or tenement buildings in urban areas not having access to high speed broadband services is different from that of villages in remote locations. As a matter of fact, old or tenement buildings located in urban areas are already close to the existing fibre-based networks of the FNOs, and they are only in lack of commercial agreements between the incorporated owners/owners' corporations/property management companies of the buildings and FNOs for the installation of fibre network equipment and blockwiring systems inside the buildings. Once such agreements are reached, residents living in these buildings can readily enjoy high speed broadband services as in the case of other buildings in urban areas.

     Notwithstanding this, OFCA will continue to encourage FNOs to invest in extension of their networks and will provide facilitating measures, including assisting FNOs to lay telecommunications facilities in public streets, so as to speed up the rollout of their networks to different parts of the territory. If OFCA receives enquiries or complaints regarding the failure of fixed broadband services in satisfying the demand of residents in individual locations (including residents of tenement buildings), OFCA will refer such enquiries or complaints to FNOs and encourage them to improve their network coverage in those locations to enable the residents to enjoy high speed broadband services of better quality.

     As a matter of fact, we note that some FNOs have been actively extending their fibre-based networks to cover old buildings in urban areas in recent years.

     Further, unlike residents in villages in remote locations, residents in urban areas generally can enjoy high speed mobile broadband services provided by mobile network operators. Currently, the speed of mobile broadband services can reach as high as 600 Mbps, which is comparable to that of fixed broadband services. While the charges of high speed mobile broadband services are generally higher than those of fixed broadband services, they still offer an additional choice to residents in urban areas.

Ends/Wednesday, November 29, 2017
Issued at HKT 15:00

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