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HKT blasts gov’t for doing ‘nothing’ for 5G

Hong Kong’s incumbent telco, HKT, has blasted the city’s telecoms regulator for doing “nothing” to help the industry prepare for the introduction of “true 5G.”  In a white paper released to the public, HKT criticised the government regulator, the Office of the Communications Authority, for not having formulated any spectrum plan in support of 5G. It argued that other regulators around the world had already begun preparations.

“It is not clear if the government understands all the implications of true 5G. The government is not making spectrum available. It has not made any new spectrum available since 2013 and will not be making any new spectrum available until 2020 at the earliest,” HKT said. “Subsequent to the decision of WRC-15 in Nov 2015, the EU and UK authorities swiftly and publicly committed the assignment of both 700MHz and 3.5GHz bands for true 5G launch by 2020.

Japan, Korea and China are also all paving the way for the launch of true 5G by 2020 by making more spectrum available. Meanwhile, in Hong Kong, OFCA has stated that there is no new spectrum available for at least the next 3 years.”  In support of its pledge for new spectrum policy work, HKT highlighted the importance of new frequencies in support of true 5G – which it said would mean not just faster speeds but also machine-to-machine connectivity at massive scale, and ultra reliable and ultra-low latency services.

“Ultra-fast data speeds require very wide bandwidth; spectrum bands of more than 100MHz are required,” HKT said. “The reality is that the requirements of true 5G can not be served by just uplifting the existing 4G network solely with higher speeds or by simply re-farming the existing 582MHz spectrum currently used for 2G/3G/4G in Hong Kong  Meanwhile, different use cases will require additional spectrum in lower bands.

“True 5G is about massive machine-type communications and ultra-reliable and low latency communications. Each of these uses requires certain performance metrics in terms of high data speeds, low latency, indoor coverage penetration, massive numbers of connectivity and reliability,” HKT added.

“Different spectrum frequency bands will service different purposes. High frequency bands can provide ultra-fast data speed, but are not good for extensive coverage; low frequency bands can penetrate buildings for indoor coverage but do not have sufficient bandwidth for high data speeds. Hence, spectrum allocation can no longer be generic as in the past when the focus was on mobile broadband alone.”  According to HKT, the Hong Kong regulatory is “unfortunately” doing “nothing” to facilitate 5G.

“It appears that OFCA is only focused on re-auctioning 900MHz/1800MHz spectrum to (a) maximise the financial ‘wind-fall’ to government; and (b) allow operators to re-farm this spectrum to 4G (which they are doing already); this is extremely short-sighted policy-making,” HKT said. “True 5G is not just going to happen by itself. To make Hong Kong the world-leading telecommunication hub once again by rolling out true 5G by 2020, the government needs to make spectrum available and facilitate access to a whole new range of sites that the government controls for the installation of small cells.”

PCCW wants to sell down HKT

PCCW, the parent company of HKT, is looking to sell HK$8.534 billion (about US$1.1 billion) worth of its stake in the incumbent Hong Kong telco. Under the scope of the deal handled by Goldman Sachs, 840.747 million HKT shares will be put up for sale at HK$10.15 per share – an 8.4% discount to the firm’s last closing price before the announcement. The disposal equals about 11.10% of HKT. Following the sale, PCCW’s stake in HKT will fall to roughly 52%.

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