Operation of Satellites
- So far two companies, Asia Satellite Telecommunications Company Limited (AsiaSat) and APT Satellite Company Limited (APT) have been granted licences to launch and operate their satellites (AsiaSat-1 and APSTAR-I respectively). According to their plans, more satellites, including AsiaSat-2, APSTAR-IA and APSTAR-IIR will be launched in 1995 and 1996.
- The launch and operation of satellites as space objects are regulated under the Outer Space Act 1986, a legislation of the United Kingdom extended to Hong Kong. The radio stations on the satellites (the space stations) are regulated under Hong Kong's Telecommunication Ordinance. The regulations are aimed at fulfilling the Radio Regulations of the International Telecommunications Union. Local legislation is being prepared to replace the United Kingdom legislation.
Satellite Telecommunications
- In 1981 Hong Kong Telecom International Limited (HKTI) was granted an exclusive licence under the Telecommunication Ordinance to provide certain external circuits and services. This exclusive licence is valid until 30 September 2006. The exclusivities cover, among other things, external circuits by radio for the provision of public telecommunications services and external private circuits for communications within a company or organization. These circuits include circuits established by satellite.
- HKTI has established an earth station at Stanley Fort of the Hong Kong Island providing access to various satellites, including INTELSAT and INMARSAT satellites over the Pacific Ocean and Indian Ocean, Palapa B2P, AsiaSat-1 and APSTAR-I, etc.
Self-Provision
- As HKTI's exclusive licence covers only certain external circuits and services there are circuits and services which fall outside this licence. In fact in some situations the Governor-in-Council (ie Governor of Hong Kong with the advice of the Executive Council) may direct that a certain service be excluded from the scope of HKTI's exclusivities if he considers it appropriate.
- Thus when a new service is developed, the Hong Kong Administration takes a conscious decision whether such a service falls inside or outside the HKTI licence. A case in point over recent years has been Manage Data Network Services which have been allowed to be provided competitively over international private leased circuits. Similarly voice value added services are allowed to be provided competitively. In addition, companies and organizations can be authorized to provide their own international private circuits by directly leasing satellite capacity. Guided by this policy, a SPETS (Self-provided External Telecommunication Service) Licence had been formally created under the Telecommunication Ordinance in June 1995.
- Under this licence, a company may use the licensed system for sending outgoing messages which originate from and/or receiving incoming messages that are intended for:
- the licensee,
- the licensee's holding company,
- a subsidiary of the licensee, or
- an affiliated company of the licensee.
- In the case the licensee is an organization, the licensee may send outgoing messages from Hong Kong and receive incoming messages to Hong Kong that relate to the common business or activity of the organization.
- To put the eligibility of SPETS licence in simple terms, in essence, if a licensee operates an uplinking station, the message uplinked must be his own message. On the other hand, if a licensee operates a downlinking station, the message downlinked must be for his own use. One point is of fundamental importance, ie the licensee cannot carry third party traffic. The reason is obvious. HKTI still holds its international licence and the Government, as a matter of policy, will honour the terms of HKTI's licence until it expires.
- The rationale behind the self-provision policy is not difficult to understand.
- First. There are real necessities for international business establishments to set up their own satellite links for the exchange of information among their branches all over the world. This is particularly important if some branches are located at places where telecommunications infrastructure is not so well developed.
- Second. To those international establishments which require transfer of information in large volume, HKTI's service may not be particularly attractive. Instead, they may wish to install their own facilities to achieve cost effectiveness. This is increasingly valid as the VSAT (Very Small Aperture Terminal) technology becomes mature. We believed that we should offer them such option.
- We hope that the introduction of the SPETS licensing system could serve to attract more international businesses, both telecommunications and others, to be established in Hong Kong, thus reinforcing its position as a regional telecommunications hub, and as a regional financial centre.
- There is no limit on the number of SPETS Licences to be granted by the Telecommunications Authority (TA). We intend to grant a licence to any applicant whose proposed operations comply with the requirements of the licence. In fact, since the introduction of the SPETS licensing framework in June this year, 15 licences have already been issued, and from the level of inquiries we receive, we expect that this number will continue to increase.
Satellite Broadcasting
- In Hong Kong, a satellite television broadcaster can uplink its programme service by either establishing its own uplinking facilities or employing the uplinking service of HKTI. The regulatory framework for the two modes of operations are not the same.
Uplinking Earth Station Set up by a Programme Supplier
- A broadcaster that wishes to uplink its programmes using its own uplinking earth stations is subject to licensing under a Satellite Uplink and Downlink Licence granted under the Telecommunication Ordinance by the Governor-in-Council on a case by case basis, ie there is no general form of licence. Broadcasting under this licence is subject various controls on the programme contents. The standards of programmes and advertisements must comply with the codes of practices issued by the Broadcasting Authority. Restrictions on cross-media ownership and foreign ownership may also apply.
- At present only one such licence has been granted. This has been granted to Hutchvision Hong Kong Limited (Hutchvision) for the uplinking of the STAR TV programmes. Hutchvision was licensed in December 1990 to transmit free-to-air satellite television programmes. Through licence amendments, the licensee is now also permitted to provide country-specific programmes and subscription based programmes. Hutchvision is currently providing more than 10 programmes through two satellites, ie the AsiaSat 1 and Palapa B2P.
- But since the only local operator of subscription television, Wharf Cable Limited, enjoys an exclusivity for local subscription television broadcasting services until 1 June 1996, Hutchvision's subscription programmes cannot be provided to the residents of Hong Kong except via Wharf's network before 1 June 1996.
- Technically there is no restriction on the number of such licences to be granted. The Government welcomes broadcasters and programme suppliers to use Hong Kong as the uplinking centres for satellite television services. In fact, the Governor-in-Council has agreed in principle to grant a licence to Galaxy Uplink Limited, which is a subsidiary of a local terrestrial television broadcaster, Television Broadcast Limited (TVB). We anticipate that more and more local and international broadcasters will establish their broadcasting bases in Hong Kong.
Uplinking through HKTI
- Not every broadcaster wishes to invest in the establishment of its own uplinking earth station. It is open for a broadcaster to employ HKTI's uplinking service. In this circumstance, the broadcaster is not required to obtain any licence under the current legislation as it will not be operating any telecommunications facilities in Hong Kong. However, HKTI would be under an obligation to ensure that the content of the services uplinked by HKTI for its customer for broadcasting purposes will comply with standards similar to those provided for under a Satellite Television Uplink and Downlink Licence. On top of that, the Government is now reviewing its legislation on broadcasting and it is likely that when a new Broadcasting Ordinance is enacted, the provision of a broadcasting service will be subject to licensing even if the operator does not operate any conveyance facilities.
Satellite News Gathering (SNG)
- On electronics new gathering, most of the broadcasters in Hong Kong are still relying on the conventional terrestrial mobile microwave links. But with the advent of small size mobile satellite uplink terminal, it is likely that satellite new gathering will become more and more popular. In fact, we have just granted approval to a local broadcaster to operate its SNG facilities for its local terrestrial broadcasting service. International broadcasters who do not hold any Hong Kong telecommunications or broadcasting licence may consider applying for a SPETS Licence if they wish to operate SNG in Hong Kong provided that the operation falls within such framework. Once again, I have to stress that a SPETS licensee is intended for own use rather than the carriage of third party traffic.
Reception of Satellite Broadcasts
- Hong Kong has imposed a minimum set of restrictions over the reception and distribution of satellite television broadcasting services.
- Television Receive-Only (TVRO) installations are not subject to any form of licensing. A TVRO installation is a satellite television receiver not connected to a distribution system. A TVRO installation may be used to receive any signals from any satellite intended for general reception.
- A Satellite Master Antenna Television (SMATV) System is subject to licensing under the Telecommunication Ordinance. SMATV systems may only be installed and operated by licensed SMATV operators. SMATV operators are regulated by the Telecommunications Authority (TA) under Satellite Master Antenna Television Licences. Government policy is to promote open and fair competition in the operation SMATV services. As of September 1995, there were 68 SMATV operators licensed. These operators had established a total of 1272 systems, providing satellite television signals to 440,000 households.
- A SMATV Licence authorizes the licensee to operate a SMATV system to receive and distribute any signals from any satellite intended for general reception. "Signals intended for general reception" is specifically defined in the SMATV licence. Briefly, signals intended for general reception include the following:
- signals not encrypted and where the SMATV Licensee and users of the SMATV systems are not required to pay any fee to the programme originator or his authorized agent;
- signals encrypted and where the programme originator has notified the TA and makes a public declaration that his signals are intended for general reception and the users of the SMATV systems are not required to pay any fee to the programme originator or his authorized agent.
- You will notice that SMATV operators are not permitted to provide a subscription television service. Once again, this is because of Wharf Cable Limited's exclusive right to provide subscription television before 1 June 1996. The Hong Kong Government has committed to review the subscription television market in Hong Kong in early 1996 and will determine whether or not subscription television services should be deregulated.
Mobile Communications
- Another emerging applications of satellite technology concerns mobile communications. As mobile satellite technology becomes mature, we anticipate the use of mobile satellite services will become popular in Hong Kong. In fact, HKTI has already established its earth station for INMARSAT-M services in Hong Kong. We are now reviewing our regulatory framework and considering whether there is need for further refinements it in order to cope with the growth of such services. While Hong Kong is very well served by cellular services and PCS services are also being licensed, we see a role for mobile satellite services in communicating with, and roaming to, other places in the Region.
Rural Telephony
- There are not too many rural areas in Hong Kong. Areas currently not served by cables are likely served by microwave for telephonic services. However we will not rule out the possibility that our licensees may seek to provide telephonic services to rural areas through satellites if the technology proves to be cost effective in the future.
Government Actions to Promote Satellite Applications
- We are well aware of the economic benefits that would accrue through the use of satellite broadcasting and communications technology. We have taken a number of steps to encourage the application of such technology. Typical examples are the liberation of the use of VSAT, SMATV and TVRO as discussed above. But there are other steps also.
Teleport
- As you all know the land prices in Hong Kong are among the highest in the world. But despite that, we have recently allocated a separate piece of land for the establishment of a satellite teleport in Chung Hom Kok on the southern side of Hong Kong Island. The site is excellent for satellite communications facilities as it has a clear line of sight to the south, while sheltered by the hilly terrain at the north. We expect that the teleport can accommodate twenty or more satellite earth stations. The site has been developed with easily accessible roads, water and power supplies, etc. We are still at the planning stage for leasing out the use of the site by telecommunications and broadcasting operators. We hope that we could invite for proposals for use of the site by end of this year. We anticipate that the establishment of a teleport would be welcomed by satellite broadcasters, SPETS licensees, etc.
Liberation of satellite broadcasting
- To encourage more satellite broadcasters to invest and base their services in Hong Kong, the Government is critically considering removing outdated restrictions imposed on satellite broadcasters, for example, on foreign ownership, cross-media ownership, language used, etc. In fact the language restrictions on Hutchvision's service have recently been removed completely. These issues are currently subject of discussion within the Joint Liaison Group between the United Kingdom and the People's Republic of China.
Liberation of satellite downlinking
- Today's broadcasters rely quite heavily on programme sources all over the would. We therefore consider that they should be granted the right to directly downlink from satellites the television signals they may require to package their own programmes, instead of relying entirely on the downlinking services provided by the HKTI. We have granted such a right to the local terrestrial broadcasters, ie Television Broadcast Limited and Asia Television Limited, the local subscription television broadcaster Wharf Cable Limited, and the satellite television broadcaster Hutchvision Hong Kong Limited. Broadcasters that make use of HKTI's uplinking facilities for uplinking may also apply for a SPETS Licence if they wish to establish their own downlinking facilities.
Contribution of Satellite to Broadcasting
- In the 1980's, television entertainment was provided only by the terrestrial broadcasters, TVB and ATV. Each of them provided one Chinese and one English channel. Now more than 440,000 homes are also served with satellite television service. The majority of these receive STAR TV programmes, but other services like CNN and CTN are attracting more and more viewers in Hong Kong. Apart from reception of satellite services by SMATV or TVRO, some satellite services are also re-transmitted through Wharf Cable's subscription television network. These include ESPN, CNN, BBC, etc. Obvious viewers are now having much more choices then ever on television entertainment.
Future Developments
- The use of satellite technology will not stop at the present level. Developments in other aspects of telecommunications and broadcasting may also bring about further growth in satellite applications.
Deregulation of Subscription Television
- For example, if the Government decides to deregulate the local subscription television market after June 1996, satellite broadcasters may be able to provide subscription based service delivered through various options, such as cable, SMATV or TVRO. This may serve to attract more satellite broadcasters to run their operations and services in Hong Kong.
Digital Video Compression
- From the recent developments in the area of video compression, it is reasonable to believe that 6 to 10 television programme channels can satisfactorily be compressed and transmitted through a satellite transponder. This will of course substantially reduce the cost of providing a satellite television programme, thus further boosting the growth of such services. It is not implausible to think that more than a hundred television programmes may be made available to Hong Kong viewers in a few years time.
Telecommunications and Broadcasting Hub
- With Hong Kong entrenching its position as a pre-eminent telecommunications and broadcasting hub, we anticipate more satellite operators and uplinkers will base their operations in Hong Kong. Mobile satellite services based on low earth orbit satellite may also develop momentum in the near future.
- From our past experience, there is no doubt that satellite technology will play an even important role in future of telecommunications and broadcasting in Hong Kong. As the regulator of Hong Kong's telecommunications services, I consider that we are making a good fist of creating the correct policy and regulatory environment for the private sector to take up the expanding opportunities.