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Technology Stocks : WCOM -- Ignore unavailable to you. Want to Upgrade?

To: Anthony Wong who wrote (3741)	1/9/1999 9:59:00 AM
From: Mazman	Read Replies (1) \| Respond to of 11568

Worldcom Says It's Aiming to Grow in Hong Kong's Business Telecom Market Bloomberg News January 9, 1999, 4:05 a.m. PT Hong Kong, Jan. 9 (Bloomberg) -- WorldCom Asia Pacific, a unit of No. 2 U.S. long-distance company MCI WorldCom Inc., said it aims to expand in Hong Kong's business market and pledged to invest in the city's telecom infrastructure. Though WorldCom Asia Pacific was recently licensed to provide international calls in Hong Kong, Chief Executive Steve Liddell said it will not compete with companies that are targeting the mass market, the Hong Kong Standard reported. WorldCom will cater both its local and long-distance services to the more lucrative business market, Liddell said. The company has been lobbying for many months to get a fixed telecoms network services (FTNS) license in Hong Kong, where four companies are currently licensed to provide local calls. Hong Kong's government will decide whether to grant the company a license to operate in the local call market within the next few weeks. WorldCom is pursuing a strategy used in many of the world's liberalized telecom markets, said analyst Guy Green of SocGen Crosby Securities Ltd. in Hong Kong. "There's not a great deal beyond what's already being offered that you can do with local residential service,'' Green said. ''You could offer faster Internet services, but obviously people are not prepared to pay for that in the way that multinational businesses are willing to pay for high-speed data connections, e-mail and other services that require a lot of bandwidth." Although Hutchison Telecom, New World Telephone and New T&T, a unit of Wharf Holdings Ltd., have had FTNS licenses since 1995, former monopoly Hong Kong Telecom still has 98 percent of the local call market. Business Calls Connecting the busy commercial district of Central is also easier than wiring the city's multistoried housing estates, one reason HK Telecom's challengers have grabbed 5 percent of the business market, Green said. WorldCom has already committed $1.2 billion in building Asian networks and is ready to introduce high-speed technology such as real-time video-linked stock trading to Hong Kong, Liddell told a Hong Kong press conference in October, though he declined to give specify how much the company is willing to invest. ''We're talking about ourselves and our competitors being given the opportunity to invest in Hong Kong's future,'' he said. ''Bandwidth is the single most important currency. Without investment into bandwidth today, Hong Kong will be unable to take advantage of the digital age tomorrow.'' The Hong Kong government, which has pledged to make the city a regional information technology hub, will have to balance such promises against the interests of some of the city's biggest conglomerates, which have threatened to cut their fixed-line investments of new FTNS licenses are granted. Hutchison Telecom is a unit of Hutchison Whampoa Ltd., a holding company controlled by billionaire Li Ka-shing. New World Telecom is a unit of No. 4 developer New World Development Co. Ltd. New T&T is a unit of Wharf Holdings Ltd., which invests in everything from property to container terminals and cable television. Government Decision The decision on WorldCom's FTNS application will come one month after Hong Kong took its penultimate step toward complete deregulation of its international call market by allowing HK Telecom's rivals to lease lines from the company, a unit of the U.K.'s Cable & Wireless Plc. Whether to grant more FTNS licenses and how many companies should be allowed to build their own international call infrastructure starting in 2000 are two of the major decisions Hong Kong's regulators still have to make regarding the liberalization of Hong Kong's telecom market, said Socgen's Green. --Anh-Thu Phan in the Hong Kong newsroom (852)2977-6600 through