Hong Kong: Consolidation threatens backfire to 3G auction plans

The government’s plans of boosting competition into Hong Kong’s wireless industry through a 3G spectrum auction could soon backfire, say reports, as the market faces significant consolidation since the bidding.

Regulators decided last November to auction off one-third of the nation’s 3G airwaves taken from each of the top wireless operators. The auction is set to begin later this year.

Only a moth after the plan was announced, telecommunications unit HKT inked a deal to acquire CSL New World Mobility, Hong Kong’s largest wireless operator, in a $2.43 billion deal.

Hong Kong’s Competition Authority has received concerns that if the deal is approved it will lead to significant harm to competition, reducing the number of wireless players in the city from six to give.

HKT’s market control would also significantly increase, say reports.

The Authority received nearly 30 submissions regarding the merger earlier this month. According to reports, HKT has vowed not to participate in the upcoming auction, among other concessions.

Full Content: South China Morning Post

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