HK's CLP Telecom Launches Brand Name, Internet Access Svs
April 24, 2001
Dow Jones Newswires
HONG KONG -- CLP Telecommunications Ltd., a wholly-owned unit of Hong Kong power producer CLP Holdings Ltd. (H.CLP), made a clear move to diversify out of Hong Kong's regulated electricity market Tuesday by launching its first ever retail brand.
The first product under the new Oxygen brand will be a dial-up Internet access service targeted towards families in Hong Kong. This will be followed by a broadband access service in mid-2001 and a mobile phone service at the end of the third quarter, CLP Telecom's Managing Director Peter Heavyside said at a press conference.
The mobile service will be launched in partnership with one of Hong Kong's existing six mobile operators, he said, but declined to give any details apart from the fact that CLP Telecom will buy the spectrum needed to provide the mobile phone service to its customers.
The telecom services under the Oxygen brand name will be Internet Protocol-based and will be backed by the finances of CLP Holdings. Heavyside declined to comment on how much money CLP Telecom has invested in its new brand, but said so far the company has spent around HK$50 million on information technology.
He also said it will take a few more years for the telecom division, which was set up in 2000, to become profitable.
"Most telecom companies have a timetable of four to five years to become profitable. CLP Telecom hopes to beat that, but we don't know that we will," he said.
One of the reasons for setting up CLP Telecom last year was to be able to leverage CLP Holdings' approximate 1.9 million household customers into other areas. However, the Internet access business announced Tuesday is focusing on a wider group than that and existing CLP power customers won't get a discount on the service, company officials said.
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Heavyside said about 1,000 customers have already signed up for the Oxygen Internet access product, which will give them unlimited access to the Web for HK$98 per month. While this is slightly below the most expensive service in the market - provided by Pacific Century CyberWorks Ltd. (PCW) - it's not a cheap service.
"We are entering the market as a high value player," Heavyside said, but added that the profit margin on the dial-up service still won't be massive.
He also stressed that the company is treading carefully in its expectations of what size market share it may be able to capture. "It will definitely be in the single digit area this year on all the products we are launching," he said.
Oxygen's family-oriented services will include a homepage creator, an online photo album and a personal calendar. It will also come with a blocking facility, which can be disabled, that will filter out from local and overseas Web sites indecent material, including sex and violence, and material that infringes on copyright laws, Heavyside said. The device will work in both English and Chinese.
The key thing, Heavyside said, is that the service will be easy to use. "Many people still think the Internet is a bit of a mystery and Oxygen is set to remove that," he said.
-By Anette Jonsson, Dow Jones Newswires; 852-2802-7002; anette.jonsson@dowjones.com
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