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6. Hong Kong
6.1 A Profile of Hong Kong Economy
The Hong Kong Special Administrative Region SAR of the PRC
is located in a favorable position leading to the gate of
Chinese inland. It is also in the international time zone
connecting the time difference between Asia and Europe.
These two factors consolidate the position of Hong Kong
as the world center of trade, finance, business and communication.
Currently Hong Kong is the tenth trade entity in the world.
In terms of calculation based on the handling capacity,
the freightage port in Hong Kong is the busiest in the whole
world. If calculated based on the amount of passengers and
volume of international freight handled, the airport in
Hong Kong is one of the busiest in the whole world. When
calculated based on the volume of bank's foreign trade,
Hong Kong is the tenth banking center in the world. When
calculated based on the volume of transaction, Hong Kong
is the seventh foreign exchange market. When calculated
based on the capital market value, the stock market in Hong
Kong is the second in Asia.
Hong Kong is a highly internationalized city, with convenient
business environment, legal system, free trade system, free
information communications, fair and open competition, complete
finance network, top capital construction network for transportation
and communications, advanced supporting services, highly
educational workers, as well as highly efficient and active
entrepreneurs. In addition, Hong Kong also has gigantic
financial reserve and foreign exchange reserve, convertible
and stable currencies, as well as concise tax system with
low tax rate. Relying on these advantages, Hong Kong is
recognized globally as one of the freest and most competitive
economic systems. In 2000, American Heritage Foundation
evaluated Hong Kong as the freest economic system in the
world for the seventh year in succession. American Kaituo
Research Institute and 53 independent research institutes
in other countries also listed Hong Kong as the freest economic
system in the world. The World Economic Forum evaluated
Hong Kong as the second most competitive economic system
in Asia, and the eighth in the world.
In the past 20 years, Hong Kong economy increased almost
2 times. The local total output value is increased actually
with the average annual growth rate of 5.4%, which not only
surpasses growth rate of the world economy, but also surpasses
the growth rate of the economic system of the Organization
for Economic Cooperation and Development. The local total
output value, calculated based on average value per capita,
is more than twice of that of 20 years ago, equal to an
actual average annual growth of 3.9%. When calculated based
on the market value at that time, the amount in 2000 reached
to US$ 24 thousand, being the second in Asia only next Japan.
In the past 20 year, the cargo trade and service trade increased
8 times and 3 times respectively, which indicates that Hong
Kong economy is becoming export-oriented day by day. In
2000, the gross value of visible trade (including transit
port, product export and goods import) has HK$ 3234 billion,
equal to 254% of local total output value, which was distinctly
higher than 148% in 1980 and 221% in 1990. If the value
of service export and service import is also counted in,
the ratio would be higher and reached to 295% in 2000, while
being 181% and 260% respectively in 1980 and 1990.
Hong Kong is an important hub of telecommunications in the
Asia-Pacific region. It possesses a submarine cable, the
capacity of which is the largest in the Asia-Pacific region,
as well as a satellite communication passage. Hong Kong
always maintains an open and competitive telecommunication
market, and encourages private agencies to invest and innovate,
which make Hong Kong maintain its position of top-ranking
telecommunication center in the world. To consolidate its
position, Hong Kong plans to develop and become the hub
of Internet in the Asia-Pacific region, develop the first
class of external telecommunication and broadcasting telecommunication
port in the world; while providing bilateral satellite network
with sufficient capacity to external telecommunication facility
supplier and broadcaster.
In Hong Kong Digital 21 in 2001 published recently, it was
pointed out to develop Hong Kong into the top-grade telecommunication
center in the world. The information scientific and technological
strategy presented includes 5 main categories:
1. Enhance the favorable e-Commerce environment in Hong
Kong;
2. Ensure that Hong Kong Government sets an example and
takes the lead in developing e-Commerce;
3. Train talents to coordinate the development of Hong Kong
information economy;
4. Strengthen the ability of Hong Kong to master's digital
science;
5. Give full play to the advantages of Hong Kong in applying
information science and technology.
6.2 Current Development Status and Ten
of Communication Industry in Hong Kong
6.2.1 Construction and evaluation of communication technology
infrastructure in Hong Kong
The telecommunication network in Hong Kong has been fully
digitalized since 1995, while it has become the important
basis of digital economy development in Hong Kong. In 1998,
Hong Kong established Information Technology and Broadcasting
Bureau, as well as brought forward a set of information
scientific and technological strategies called Digital 21
strategy. In this set of strategy, one essential factor
to promote the development of Information Science and Technology
is to establish a kind of culture and environment, which
can initiate the creation of new ideas and is ready to apply
advanced information science and technology. Hong Kong always
practices this set of strategy, and has already become one
of the cities with the most perfect network facilities in
the world. The private agencies have made larger scale investment,
to develop advanced telecommunication capital construction.
Hong Kong provides perfect telecommunication infrastructure
to business carriers and consumers. By the end of 2000,
Hong Kong has 5 million sets of telephone and more than
3.95 million telephone lines, i.e. every hundred person
has 73 sets of telephone and 57.5 telephone lines. Hong
Kong is one of the regions in the world with the most popularized
telephone services. In addition, Hong Kong has more than
404037 specialized facsimile lines, to provide data communication
services.
At present, Hong Kong is directly connected with 8 submarine
cable systems. The Okinawa-Luzon Hong Kong submarine cable
system connects Hong Kong Philippines, Japan and North America;
the Singapore-Hong Kong-Taiwan submarine cable system connects
Hong Kong, ASEAN countries, Australia and Europe; the Hong
Kong-Japan-Korea optic-fiber cable system connects Hong
Kong, Japan, South Korea and North America; the Hong Kong-Taiwan
optic-fiber cable system, called Hong Kong and Taiwan No.
2, connects Hong Kong and Taiwan; the Asia-Pacific cable
system connects Hong Kong, Malaysia, Singapore, Taiwan and
Japan; while the Thailand-Vietnam-Hong Kong submarine optic-fiber
cable system transmits the communications among Hong Kong,
Thailand and Vietnam. Two new submarine optic-fiber cable
system were put into service in 1997: the Asia-Pacific cable
network connecting Hong Kong, Taiwan, South Korea, Japan,
Thailand, Philippines, Malaysia, Singapore, Indonesia and
Australia; as well as the global optic-fiber circuit connecting
Hong Kong, Thailand, Shanghai, South Korea, Japan and all
countries in the world.
Hong Kong Telecommunications, Asian Satellite Co., Ltd.,
Asia-Pacific Communication Satellite Co., Ltd., Satellite
Broadcast (Hong Kong ) Co., Ltd., as well s Galaxy Satellite
Broadcast Co., Ltd., set up altogether 41 Satellite Ground
Station Send receive Antennas, to provide satellite telecommunication
and telecast services.
The Wide Frequency Network has already covered about 98%
family users and almost all commercial mansions. The Office
of the Telecommunications. Authority conducted two rounds
of consultation about the interconnection arrangement of
wide frequency network in November 1999 and June 2000, and
declared in November to make the supervision frame for wide
frequency interconnection. This supervision frame is helpful
to the promotion of effective competition, making consumers
have more choices and get service with suitable price. In
addition, this supervision frame can also maintain the fair
competitive environment of market, and attract the investments
in wide frequency infrastructure relevant to the supporting
of telecommunication services.
6.2.2 Current status and tendency of communication industry
development in Hong Kong
At present, the users of Hong Kong straight-through
international call service can dial directly to 232 countries
and more than 2,200 Chinese inland cities. Within one year
up to march 1999, the hole time of international call was
altogether 3.713 billion minutes. In Hong Kong, all operators
of fixed telecommunication service and public mobile wireless
telephone service have connected to International Receiving
Transmission Station operated by Hong Kong Telecommunication
fixed network service Corp. Through this arrangement, the
customer can obtain easily all kinds of international telecommunication
access services, no matter which operator's service he uses.
6.2.3 Configuration and development trend
of Telecommunication operation Market in Hong Kong
1. Objective: establish an open and competitive telecommunication
market
The telecommunication market in Hong Kong is one of the
most open telecommunication markets in the world. Since
May 1999, the Government the Hong Kong special Administration
Region began to publish the policy of opening telecommunication
market gradually, and by now has achieved great progress
in pursuing relevant policies. All telecommunication markets
in Hong Kong, including the markets of local and external
telecommunication services and telecommunication facilities,
have been opened and have introduced in competition. At
present, there are altogether 10 carriers holding the license
for local fixed telecommunication, all of which have the
capability of providing wide frequency service. The authorities
concerned supervised and published 3 existing and new agencies
holding license plate for local wired fixed telephone network
service, 5 new agencies holding license plate for local
wireless fixed telephone network service, as well as the
progress in reaching targets and fulfilling promises of
those CATV carriers, who have obtained the license for providing
telecommunication services. As for the external telecommunication
facility market, up to now there are altogether 34 carriers
succeeded in applying for license, among which, 15 carriers
provide external telecommunication facilities by utilizing
satellite, and the other 19 provide external telecommunication
facilities by utilizing cable. Among them, 20 carriers have
already received the license (8 utilizing satellite and
12 utilizing cable to provide external telecommunication
facilities). Along with the coming out of the third-generation
mobile communication services, the Hong Kong Government
will issue 4 additional license for mobile service providers.
The invitation for license application was already issued
in July 2001. The Hong Kong Government already set about
to make the control and license issuing frame for the third-generation
mobile services. Moreover, foreign companies can provide
telecommunication services and facilities in Hong Kong,
without any limitation on foreign capital proprietary. The
Hong Kong Government makes efforts to provide an environment
of fair competition for telecommunication industry, with
the objective to establish an open and competitive telecommunication
market. The detailed plan is:
The number of licenses for local fixed telephone network
services. The objective is to maintain the current number
of licenses for local fixed telephone network services until
the end of 2002.
The number of licenses for external telecommunication services.
The objective is to maintain an environment of fair competition,
so as to ensure that the market can determine the optimum
number of licenses.
The number of licenses for external fixed telephone network
services. The objective is maintain an environment of fair
competition, so as to ensure that under the limitation of
actual conditions, the market can determine the optimum
number of licenses.
The number of licenses for mobile phone services. The objective
is to maintain an environment of fair competition, so as
to ensure than under the limitation of frequency spectrum
capacity, the market can determine the optimum number of
licenses.
The number of licenses for BP services. The objective is
to maintain an environment of fair competition, so as to
ensure that under the limitation of frequency spectrum capacity,
the market can determine the optimum number of licenses.
The number of Internet services providers. The objective
is to maintain an environment of fair competition, so as
to ensure that the market can determine the optimum number
of providers.
2. Memorabilia in the opening of Hong Kong telecommunications
In 1995. After the term of exclusive right expired on June
30, Hong Kong Telephone Corp. as well as other three corporations,
i.e. New World Telephone Co., Ltd., Hong Kong New Telecommunication
Co., Ltd., and Hutchison Communications Limited, obtained
the license plates, to provide local fixed telecommunication
services in the form of competition.
In 1997. In March, New World and Hutchison Communications
Limited jointed in the competition of personal communication
services market. In May, British Telecommunications (Hong
Kong) Co., Ltd. Became the first operator to get the license
for virtual dedicated network services. In June, Bafang
Communication Co., Ltd., and Huiya Communications pushed
forward personal communication services. In July, Xunlian
pushed forward personal communication services. In December,
Hong Kong Telecommunication CSL Co., Ltd. Purchase Xunlian
Telecommunication Co., Ltd. The items purchased include:
digital mobile phone services (D-Amps), personal communication
services (GSM 1800) and PB services.
In 1998. In January, City Telecommunication (Hong Kong)
Co., Ltd. Became the first operator to get the license for
international line distributing facsimile and data services.
In March, AII Direction Communication Co., Ltd., which is
one of the 6 personal communication services operator, was
procured by Digital Telecommunication Co., Ltd. Returned
in March the exclusive license for providing certain external
telecommunication lines and services, which was 8 years
earlier than the original deadline of year 2006. For this,
the Corporation obtained the cash compensation of HK$ 6.7
billion.
Bafang in 1999. Te external telecommunication services market
was open on January 1st. The external telecommunication
services providers were permitted to transmit the remote
communications through the line of category A (i.e. can
realize the truly price competitive line by direct access
through distributing direct international dedicated line,
indirect transference through transmission, direct actual
access through competitive external interface facilities,
or indirect access through the switching arrangement). The
mobile phone number carriable services was brought into
effect on March 1st.
In 2000. After the opening of external facility market,
the telecommunication market was fully open in January.
The licenses were issued respectively to 5 local fixed telecommunication
network services carrier utilizing wireless technology,
12 external fixed telephone network service carriers utilizing
satellite, as well as 4 external fixed telephone network
services carrier utilizing cable. Hong Kong Cable Television
also obtained the license plate and could provide telecommunication
services through its synthetic fiver optic coaxial cable
network. Hong Kong Wide Frequency Network Co., Ltd., which
was one of the 5 carriers holding license for local wireless
fixed networks, pushed forward the services in February.
In June, the Legislation Council passed through Telecommunications
Regulations (Rev.) in 2000. The main contents rerised included;
enhance the safeguard measures for the competition in telecommunication
industry; improve the arrangement for telecommunication
carrier conducting inter-connection and setting up telecommunication
equipment in the lands and buildings; simplify the licensed
issuing frame, to respond to the market development more
flexibly; and zuthorize the Director Telecommunication Authority
to the right on some technical issues (such as: the numbering
plan the technical standard for telecommunication services).
In June, Asia Satellite obtained the license for launching
and operating satellite (#4 Asian Satellite), so as to transmit
4 satellite broadcasting services channels distributed to
Hong Kong. In August, PCCW purchased Hong Kong Telecommunication
Co., Ltd. (In July 1999, the English description of Hong
Kong Telecommunication was changed to Cable and Wireless
HKT Limited.
In 2001. In May, the Legislation Council passed through
Telecommunication Regulations (Rev.) in 2001. The main objective
of this revision was to entitle the Directors of Information
Technology and Broadcasting Bureau as well as of Telecommunications
Bureau, to auction or invite public bidding in regard to
the utilization of frequency spectrum. It was necessary
to formulate relevant regulations, so as to conduct the
work of issuing license for the third-generation mobile
services as well as conduct auction or public bidding in
the future. www.ofta.gov.hk
3. Local fixed telecommunication network services
Along with the expiration of the exclusive right of Hong
Kong Telephone Co., Ltd. In local telephone services on
June 30, 1994, four corporations that is Hong Kong Telephone
Co., Ltd., New World Telephone Co., Ltd., Hong Kong New
Telecommunication Co., Ltd., as well as Hutchinson Communications
Limited obtained the licenses respectively, to operate the
fixed telecommunications services in the form of competition.
As one local carrier being the dominant among the four corporations
with licenses, Hong Kong Telephone Co., Ltd. Should take
the responsibility of complete services, to provide high
quality, effective and continuous basic services, including
the provide of common exchange tone voice telephone services
within reasonable time to the consumers living anywhere
in Hong Kong. The local telephone services within reasonable
time to the consumers living anywhere in Hong Kong. The
local telephone services provided by 3 competitive carriers
of fixed telephone network was not under the control of
any charge regulations. However, the charge of local telephone
services the by the Hong Kong Telephone Co., Ltd. Was controlled
by the upper limit of increments since 1993. The Hong Kong
Telephone Co., Ltd. Would increase the charge of telephone
services wholly every year. The increment should be no more
than the consumer price index minus 4%. From August 1998,
Hong Kong Telephone Co., Ltd. Could rebalance gradually
the charge of telephone line. As for the increment for the
telephone services of non-telephone services of non-telephone
line, the ceiling was still the consumer price index minus
4%. This limitation was still valid before the annual inspection
in 2000. Based on this revised arrangement, the monthly
rental of residence telephone line charged by Hong Kong
Telephone Co., Ltd. Could not exceed HK$90 since 1 January
1999 and could not exceed HK$100 since 1 January 2000. At
present, the monthly rental of residence telephone line
is HK$ 90. The Telecommunication Administrative Bureau also
stipulates: that the corporations holding license must ensure
that the consumers do not need to change the telephone number
when changing the carrier of fixed telecommunication network
services.
To introduce more intense competition into the local fixed
telecommunication market, at the beginning of 2000, the
Government issued licenses to 5 local wireless fixed telecommunication
network service carrier. In addition, the Government issued
one more license to the Hong Kong Cable Television Co.,
Ltd., to provide telecommunication services through its
synthetic optic fiber coaxial cable network. At present,
there are altogether 10 local fixed telecommunication network
service carriers, each of which can provide wide frequency
network and services.
The main carrier for fixed telecommunication network services
or fixed services are: the Hong Kong Telephone Co., Ltd.,
Hutchison Global Telecommunication Co., Ltd., ¾Å²ÖNew Telecommunication
Co., Ltd., as well as New World Telephone Co., Ltd.
4. International telecommunication services
In 1981, Hong Kong International Telecommunications Co.,
Ltd. Obtained the exclusive license with the effective period
of 25 years, to provide the external telecommunication line
and services. In January 1998, the HKSAR Government reached
an agreement with Hong Kong Telecommunication Co., Ltd.
According to this agreement, Hong Kong International Telecommunication
Co., Ltd. Returned its exclusive license on 31 March, 1998,
and the competition was introduced into the external telecommunication
services market from the 1 January, 1999. At the same time,
the license for fixed network services held by Hong Kong
Telephone Co., Ltd. Was modified, to extend its business
scope to including external fixed telecommunication services
and lines. The modified licenses were issued to Hong Kong
Telephone Co., Ltd., Hong Kong International Telecommunication
Co., Ltd., as well as Hong Kong Telecommunication CAS Co.,
Ltd. (with the joint name of Hong Kong Telecommunication).
The license for fixed network services held by the other
three fixed network services carriers were also modified
at the same time. They were permitted to provide external
services from 1 January 1999 and provide external facilities
from 1 January 2000. The carriers could apply for relevant
licenses, if they wanted to lay new submarine cable or overland
cable or use non-cable telecommunication mode (mainly were
satellite), to provide external telecommunication facility
services. Up to the end of that year, altogether 16 carriers
succeeded to apply for the management of external telecommunication
facility by utilizing cable, and 15 operators succeeded
to apply for the operation of external telecommunication
facility by adopting non-cable mode. After two rounds of
consultation, the Government published its decision in October
1998: from 1 January 1999, it would issue the licenses for
operating external telecommunication services without quantity
limitation. Up to June 1999, there were altogether 112 carriers
holding licenses for external telecommunication services
in the whole Hong Kong.
5.Public wireless mobile phone services
The diffusion rate of Hong Kong public wireless mobile phone
services is about 76%, the highest in the world. However,
the competition of Hong Kong public mobile phone services
(including personal communication services) market is very
fiercely. On 1 March 1999, mobile number portability services
was launched, which allowed customers to switch between
different mobile network carriers with original phone number
retained, made the competition between the mobile network
carriers even more fiercer. By the end of year 2000, though
after several business purchase, number of carriers was
reduced from 8 to 6, and they provided eleven digital systems
in total with customers exceeding 5.2 million with an annual
growth rate 31%. In addition, the introduction of Dual frequency
Services also brought more choices for customers in the
services section. Competition was still very fierce. In
order to match with the development of global mobile communications
industry, Hong Kong government planned to award the license
of 3G mobile services in the combination method of attaching
"open network" stipulation. The combination method
is to go through prior evaluation and examination, to carry
out frequency spectrum competitive bidding, to establish
the policy and goals of license awarding framework including
accelerating the development of telecommunications industry,
safeguarding the rights of customers and maximizing the
benefit of macro economy. Starting from the year 2001, the
HK SAR government issued relative licenses. Public wireless
mobile phone services carriers mainly are Hong Kong Mobile
Communication Co., Ltd., Hutchison Telephone Co., Ltd.,
Smar Tone and Hong Kong Mobile Communication Co., Ltd.,
etc.
6. Public Wireless Paging Services
The massive reduction on the price of mobile phones and
services charge of the mobile phone services diminishes
the attraction of public wireless paging services that is
only one-way communication. By 30 June 1999, there were
total 29 licensed carriers providing public paging services
to 432 thousand subscribers, with a diffusion rate of 6.3%.
7. International value-added network services
By the end of year 2000, there were total 235 Internet services
providers in Hong Kong. The registered subscribers in the
way of dial-up access were 2283047, i.e. there were 33 subscribers
per hundred people.
6.3 Development and Market Analysis of
Hong Kong Information Industry
6.3.1 Electronic products
1. A brief introduction
Electronic products trade is the Hong Kong's biggest export
trade. In 1999, Hong Kong was the world largest export area
of computers, radios and telephone sets. In 2000, Hong Kong
electronic product exports raised 28%. Due to slowdown of
world economy, Hong Kong's electronic product export decreased
by 2% during January to October in the year 2001, and its
exports to the USA and EU decreased by 17% and 10% respectively,
but its sales to Mainland China increased by 19%. Hong Kong's
electronic products export between January and October in
the year 2001 amounted to 36% of the Hong Kong total export
value. What contributed most to the export of electronic
products were video and audio products including radios,
record players, tapes, CD players, TV sets, video recorders,
VCD, DVD, etc. In addition, electronic toys, electronic
games and relevant parts and electronic watches, etc also
accounted for a quite large proportion. The relevant computer
products including desktop computers, laptop computers,
palm computers, drives and wired phone sets, wireless phone
sets, etc. were also the important composition of the export
electronic products in Hong Kong.
2. Trend
(1) Because of participation of other countries and regions
in Asia, electronic products market competition is becoming
more and more fierce, which imposes quite big influence
on Hong Kong's electronic product export. Relatively speaking,
the market competition of low-end electronic products will
be even fiercer, but export of Hong Kong electronic products
is mainly oriented at the high-end markets. Meanwhile, participants
such as Singapore and Taiwan, China who have several electronic
products competing with Hong Kong on the high-end markets
aim at markets different from that Hong Kong's objective
market, therefore, Hong Kong's electronic product export
will still enjoy quite good development space in the coming
years.
(2) The most important competitors of Hong Kong electronic
products in the future are electronic enterprises from Mainland
China, especially OEM product on the international market.
Thus, at present, on the one hand, Hong Kong's electronic
enterprises are striving to develop the value-added of OEM
products to maintain their international competitiveness
on this market; on the other hand, they have their eyes
on the ODM market, which will lead to more technical and
infrastructure investment. But Hong Kong's electronic enterprises
have considered it as an important strategy to develop,
because this strategy could bring into play the advantages
of Hong Kong's electronic enterprises such as product design
and development ability, catching keenly product development
trends in the international market and the preference of
different consumers, etc.
(3) Parts and components of consumption electronic products
develop towards high-end products. In order to further raise
the attached-value of products, manufacturing enterprises
of this kind of products are developing towards the vertical
integration of higher level. On the other hand, with the
diversity of consumers' demand, it requires enterprises
to take quick reaction to the market. Hong Kong's electronic
enterprises possess strong ability in this aspect, they
are able to continuously change the products' function and
types to keep up with the consumers' demand. Meanwhile,
because of products cycle shortening, it requires enterprises
to replenish stock quickly based on market change, which
is especially important in the export market, and this pushes
Hong Kong's electronic enterprises improve their methods
of product management and stock management continuously.
(4) Along with the importance of e-Commerce becoming more
and more distinct, it has been the mainstream that Hong
Kong's electronic enterprises promote sales by the use of
e-Commerce. In addition to sales promotion through their
own Web Pages, they also apply some even higher e-Commerce
means such as to exchange data, provide logistics management
and customer services with customers and relevant enterprises
with the help of Internet, modern communication equipment,
etc.
(5) Standards for product export become more and more stricter.
For example, electronic product export to the USA shall
meet the security standards such as UL/ETL, and product
export to EU shall also comply with the relevant security
standard, attached with CE tag. Electro-magnetic products
shall be exported to USA in accordance with FCC standard,
and to Canada with CSA safety standard, etc. There is also
an issue of environmental protection. Green products shall
be provided, and electronic products are not allowed to
contain heavy metals such as lead and mercury.
6.3.2 Telecommunication equipment industry in Hong Kong
(1) A brief introduction
There are many telecommunication products exported abroad
in Hong Kong, including common phone sets, wireless phones,
mobile phones and complicated system products. According
to the existed statistics data, Hong Kong was the world
largest phone export area in 1999. The exports of telecommunication
equipment parts and components amounted to over 70%. Majority
of Hong Kong telecommunication equipment production base
have transferred to mainland China, and companies in Hong
Kong are only responsible for product design, development,
management, logistics support and marketing. Many enterprises
among them have shifted to the ODM market.
Hong Kong telecommunication equipment export increased 9%
between January and July in 2001, while the increase in
2000 reached high up to 21%. For the first seven months
of 2001, its export to the USA decreased by 23%; to Europe,
increased 28%, and to mainland China, increased 33%. So,
in the aspect of amount, Chinese mainland is the largest
export market of Hong Kong telecommunication equipment.
(2) Trend
3G mobile communication equipment and broadband application
equipment will be the focus in future market. Telecommunication
equipment applying Blue-tooth Technology will gradually
step into the market mainstream. High frequency wireless
telephones will also be one of the key products.
6.3.3 Hong Kong information technology services-industry
(1) A brief introduction
Software industry is the key composition of IT industry.
Though, local software companies in Hong Kong are mainly
small-or medium-sized companies (less than 20 staffs), they
are still able to develop some competitive, customized services
of high quality software for local services or customers
at abroad. Especially the developed finance industry in
Hong Kong provides many opportunities for the development
of software industry since they need the world top-class
software for investment banks and agencies. According to
the investigation of Hong Kong Productivity Committee, for
software services provided by local software enterprises
in Hong Kong in 2000, 80% of them were for the local services
in Hong Kong, 20% was for exports. Half of exports went
into mainland China market, accounting for the 10% of total
output.
According to the calculation of Hong Kong Productivity Committee,
gross income of Hong Kong separate software dealers reached
HK$9 billion in 2000, among which 20% came from exports.
IT services are divided into two major categories: hardware
services and software services. The scope of services includes
banking and finance systems, some world largest and most
complicated computer application can be found in Hong Kong
finance field, such as Exterior Electronic Transaction System
of Stock Exchanges, RTGS between banks in Hong Kong are
much more advanced than similar systems in the world, they
can carry out on-line transaction, investment and bank business
through Internet or Mobile phones. Services also involve
in transportation and logistics, trade, wholesale, and retail
sale, manufacturing, graphics and multimedia, etc. Majority
hardware services providers in Hong Kong are the distribution
dealers of international large-scaled computer companies;
meanwhile, dragonhead enterprises of them also provide hardware
services, software development and consultation. According
to the investigation of Hong Kong Productivity Committee,
there are about 800 independent software dealers with total
staffing about 18000 people in Hong Kong, and most of them
are rather small, which 55% enterprises have less than20
staffs. In 2000, there were 2199 kinds of finished software
products sold out in Hong Kong., and 28% of them were developed
by the local software enterprises in Hong Kong. Software
services in Hong Kong are mainly concentrated on the following
fields:
a. To add value to the existing software products and resell;
b. Development of the software ordered by customers;
c. System and network integration;
d. Electronic data processing;
e. Information system consultation;
f. Hardware manufacturer engaging in system design at the
same time.
(1) Trend
In the coming years, application development of e-Commerce
and mobile commerce will be the main growth point in information
service field. Because Hong Kong possess the top-class optic
fiber telecommunication infrastructure, Hong Kong enjoys
the good environment to develop software based on web application,
intranet solution, multimedia, EDI, e-Commerce, Video-on-demand
(VOD), etc. Other fields sharing the bright program future
include customer relationship management, enterprise resources
management, supply/demand chain management, network games
and information safety, etc.
6.3.4 Application of information technology in Hong Kong
1. E-Commerce
The Hong Kong Government set off to promote the development
of e-Commerce, mainly set off to establish a set of informatiozation
infrastructure to support e-Commerce, so as to confirm the
identity of person involving in transaction, to guarantee
the completeness of documents exchanged by both parties
during the transaction without disclosure, to guarantee
both parties shall confirm they did make transaction after
electronic transaction was made, and give the legal status
of electronic transaction.
In order to gradually strengthen the citizen's confidence
in e-Commerce, the HK Government has established the Hong
Kong Post Administration as Public Certification Authentification
Authority. The HK Government enacted Regulations on Electronic
Transactions (RET) to establish necessary legal framework
to have e-Commerce carried out on a certain basis and in
a reliable and stable way. The purposes of RET are to have
the electronic record and digital signature used during
electronic transactions empowered the legal acceptance just
as that for the records and signatory documents used in
traditional. Such regulations also define the patterns for
setup and operation of Public Certification Authenfitication.
In order to conquer the security problem, one of the main
barriers to e-Commerce, Hong Kong Post Administration has
established a set of public key infrastructure, With the
application of digital certificate and public/private encrypton
key mechanism, the issues of safety transactions and the
completeness of information contend on Internet are readily
solved.
Government is now establishing the informationzation infrastructure
for electronic public services, to provide various kinds
of public services to citizens through Internet and other
electronic means. In addition, the informationzation infrastructure
established for such a plan could also be used to provide
e-Commerce to private institutions.
In order to enhance the awareness and knowledge of publics
and local enterprises to e-Commerce application, the HK
Government has carried out a series of promotion and education
activities. In addition, in order to popularize the plan
of electronic public services, the HK Government carried
out publicity through mobile demonstration, promotion or
shows and to utilize the analog systems to let citizens
have chances to learn through such plan by themselves.
In order to upgrade the competitiveness of Hong Kong industry
and commerce especially those small and medium enterprises,
Hong Kong Telecommunications cooperate with 12 world famous
IT and communication services corporation such as IBM, Microsoft,
Compaq, Kodak and Hewlett-Packard, etc., to research and
develop the technical platform, services and application
functions of Omni-Intelligent Office to assist Hong Kong
small-and medium-sized enterprises to raise their productivity
and competitiveness. In addition, Hong Kong Telecommunications
also work with these companies to research, to find out
best solutions and development directions in the fields
of electronic business and trade application function, office
automation plan, electronic financial affairs function,
document and image processing, multimedia business telephone
information search services and documentation services.
The Hong Kong Productivity Council and Hong Kong Telecommunications
signed a protocol to cooperatively develop business broadband
network services--- interactive productivity services. The
interactive productivity services is the first broadband
business application services system in the world, it will
provide a diversity of electronic information business for
industry and commerce, including high-speed Internet, integrated
communication function, on-line services and business information
and training services. This services is of benefit for industry
and commerce enterprises to reduce operation cost, to improve
productivity and strengthen competitive advantages.
2. E-Government
The Hong Kong Government established e-Government Coordination
Office under Information Technology and Broadcasting Bureau,
which is responsible for coordination of e-Government program
of different government departments. The task of Coordination
Office is to implement cultural transformation within governments,
to oversee and implement the development issues of the whole
e-Government, to coordinate works of different departments,
to deal with problems occurred between different departments
due to implementation of inter-government cooperation program,
while exploiting new patterns to promote e-Government program.
2001 Hong Kong Digital 21 strategy in defined several e-Government
objectives, one of which was to increase the rate of public
services suitable for e-Services to 90%. Up to now, total
65% of public services suitable for e-Services have provided
choices for e-Services through "Electronic Services
Delivery" program and other government web pages, including
submitting Taxation Declaration Sheet, changing driving
licenses and registering to be a voter. The new services
will be presented continuously in future, such as: reserve
facilities for public exams; real time transportation and
image services; and to provide services for ready-marriage
couples to reserve the date of marriage registration, therefore
they do not need to wait in turn at the Marriage Registration
Office for registration, and to guarantee to reserve certain
lucky day in Chinese lunar calendar to register the marriage.
The Hong Kong government will put forward the following
e-Government flagship Cyberport project which bring massive
benefit for government and society:
Government to Citizen: accelerate the pace to use electronic
pattern to provide public services, especially through "Electronic
Public Services" program.
Government to enterprises: take active measures to promote
the electronic purchase and to develop an electronic transaction
market for government purchase; while setting targets that
80% of government purchase will be done through electronic
method before the end of 2003.
Government to Employee: improve the management efficiency
of public servants and accelerate the internal communication
with employees.
Government to Government: Prepare to compile the annual
financial budget in electronic way, this measure will influence
all departments and push them to enter into the tide of
electronic reform.
In order to assist departments to improve e-Government capabilities
and make arrangements, government office automation program
with an expense up to KH$ 500 million had been passed. The
Hong Kong Government will sped KH$ 180 million to gradually
implement the confidential mailing system at all government
departments before April 2002, and to realize the exchange
of confidential documents in electronic way safely. In 2001,
the total amount of HK$ 1.6 billion was reserved in the
non-recurrent expense in 2001 fiscal year to equip departments
and to improve their electronic capabilities.
3. Health care
Hon Kong Health Information Network (HIN) dated back to
the then-year program for 1992-2002 issued by Hong Kong
Hospital Authority, and was developed from the initial hospital
information system composed of distribute pattern workstation
in 1992 to the present Hong Kong Health Information Superhighway
centered on network and based on community. It is a community
HIN superhighway, connecting Hong Kong Hospital Authority
and its affiliated 44 hospitals, 57 specialist outpatient
clinics, and the General Outpatient Clinics of the Department
of Health, and private hospitals and general practitioners
in private sector and other institutions. Patients and citizens
at home that can be reached Internet telecom links. Hong
Kong Health Information Superhighway includes three sections:
infrastructure construction, user terminal services and
application software systems. The key components of infrastructure
construction is Hong Kong Health Information Network (HIN),
information technology and skills and quality of people:
The content of User Terminal Services is Hong Kong Patient
Main Index (HKPMI), Computer-based Patient Record (CPR),
and Hong Kong Patient Card (CS); Application Software system
mainly includes Clinic Management System, Medical and Technical
Section Management System, Administration and Decision Support
System, Office System, International Network and Intranet
Application System, etc.
4. Broad frequency traffic live broadcasting services
In 2001, Hong Kong Government put forward a broad frequency
traffic live broadcast Services to enhance the road traffic
information services which only provide freeze frame images.
Such services provide the immediate video image of road
situation, live broadcasting includes parts of main places
along the highways in Hong Kong Island, Kowlloon, Quan Bay
and Dun Meng, could provide it in the Internet 24 hours
a day and seven days a week. This system takes the consideration
of users of different platform, including users of Windows,
Unix, Linux or MacOS all can enjoy the same services. New
image services can hold maximum 1000 people to use at the
same time, In order to have people share the relevant services
fairly, the pre-set browsing time per person is 5 minutes.
When browsing time is up, system will automatically be shut
and provide the services to other users.
5. Education
In 2001, the Hong Kong Government planned to spend HK$ 2.2
billion on eliminating "the Digital Divide", while
enhancing the capabilities of people at different levels
to grasp digital technology. The HK Government has made
efforts to eliminate or avoid "the Digital Divide"
including corresponding measures to enhance IT education
and training, to popularize IT, to strengthen the community
IT knowledge, and to develop e-Government services.
(1) To enhance IT education and training
------To push IT education in primary and middle schools,
to provide training for all teachers, to increase the use
of information technology when delivering lectures, and
teachers will use IT to teach 25% of school courses in the
academic year of 2002 to 2003.
------To allocate funds to schools to purchase laptop computers
to lend to students who need it and for their free access
to Internet.
------To carry out test programs together with world-famous
IT companies in the summer vocation of 2001, while providing
professional IT training to middle school students.
------To provide IT training courses for in-services staff
and unemployed people, to enhance their capabilities to
integrate with the digital society.
(2) To popularize the information technology
------To provide favorable environment so as to popularize
the application of information technology at all levels
of society.
------To place personal computer connected with the Internet
at places (including community halls/center, civil administration
offices, public libraries, post offices and voluntary institutions)
convenient for citizens covering whole Hong Kong so as to
enable common citizens and even disadvantageous group have
more chances use information technology free.
------To assist people with disabilities to purchase computer
facilities to help them get a job.
------To support local organs to develop suitable software
for people with ablepsia and sight problems to use.
(3) To strengthen the Hong Kong Community for digital exploitation
------"IT Hong Kong" campaign launched in September
2000, include following events: to hold a series of IT knowledge
courses, setup a "IT Hong Kong" web site, promote
IT new community program, carry out regional IT activities,
and to broadcast education and promulgation programs about
information technology on the television. The offering of
IT knowledge courses has benefited 18,000 people, and such
courses will be held continuously in future and to provide
15,000 numbers enrollment for courses.
(4) To develop e-Government services.
------In the aspect of "Electronic Public Services
Program", more new services will be put forward continuously
,which enable citizens to gain electronic services delivery
through Internet or Public Information Services Stations
placed at many convenient places around whole Hong Kong.
Furthermore, the planned website is also designed to provide
text-only version for people with ablepsia and sight problems,
and to provide contact-type soft pad for the convenience
of wheelchair people to input information.
6. Increased investment to school
The Hong Kong Special Administrative Region pays attention
to the application of information technology in education.
Director of Education Department mapped out a series of
programs, such as "21 Century Classroom Program Exhibition",
etc. All schools in Hong Kong have already accessed to Internet,
while over 90% of schools access to Internet through hired
circuit or broad frequency. The Hong Kong Government decides
to take out capital investment of US$ 410 million and annual
recurrent expenditure of US$ 70 million and to implement
a five-year program to spread information education at schools,
and to commit not only enhance the information technology
infrastructure of all schools, but also provide training
to teachers and amend relevant courses to improve teachers
and students capabilities to apply information technology.
The objective is to utilize information technology teach
25% of school courses by or before the academic year of
2002-2003.
7. take care of disadvantageous groups
The Hong Kong Government takes special care to those disadvantageous
groups who have less opportunities to access IT facilities,
such as senior citizens, housewives, handicapped people,
etc. while practical measures are taken to ensure them to
have more chances to access Internet, computers, telecommunications
and other IT facilities.
------To provide the handicapped people taxation deduction
and exemption, and help them purchase computer facilities.
------The H.K. Government cooperation closely with industry
and education communities, private institutions, charity
and non-profit societies to hold various kinds of activities
so as to assist all social state to know and apply information
technology.
------To provide free training and knowledge courses for
all senior citizens, housewives, handicapped people at each
district of Hong Kong. From the opening of relevant courses
in October 2000 to the end of 2001, there were 18000 people
got trainings on basic skills to use computers, to browse
the Internet and send and receive E-mail.
------To ensure information on websites and in other electronic
forms available can be used and browsed by all Hong Kong
community (including handicapped people).
------To place specially designed facilities such as display
amplifier, blind man typewriter, voice analog software and
large flat LCD, etc. in the community digital stations for
the special use of people with ablepsia and sight problems.
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