HKTV allowed to buy mobile TV business from China Mobile

6 Jan 2014

In a decision issued on 3 January 2014, Hong Kong’s Communications Authority has permitted broadcaster Hong Kong Television Network (HKTV) to purchase the mobile TV business of China Mobile Hong Kong without any further investigation, on the basis of its assessment that the acquisition does not have significant competitive consequences. On 20 December 2013 HKTV said it completed the acquisition of 100% equity interest in the Chinese-backed cellco’s mobile TV spectrum licence holding unit – named China Mobile Hong Kong Corporation Limited (CMHKC) – for a price of HKD142.2 million (USD18.3 million).

HKTV made an announcement that it would launch over-the-top (OTT) and mobile TV services alongside the deal to purchase – through its wholly-owned subsidiary Talent Ascent Limited (TAL) – 100% of CMHKC from its mobile network operating parent China Mobile Hong Kong Company Limited. CMHKC holds one frequency multiplex of 8MHz (678MHz-686MHz) in the UHF band for the provision of broadcast-type mobile TV services, under a Unified Class Licence which expires on 30 August 2025. HKTV added that it will also attempt to win a ‘Free-To-Air TV’ broadcast-type licence, having previously had an application rejected. HKTV’s OTT and mobile TV services are due to launch by July 2014.

TeleGeography’s GlobalComms Database says that the 678MHz–686MHz frequencies were awarded to China Mobile Hong Kong in June 2010 in return for Spectrum Utilisation Fees (SUF) of HKD175 million and a requisite performance bond, and in December 2012 the cellco launched a carrier-independent mobile TV network in Hong Kong using the mobile broadcast licensed frequencies and the CMMB technology platform.

Meanwhile, today the South China Morning Post reports that Chinese parent group China Mobile has launched an investigation into its Hong Kong subsidiary’s mobile television deal with HKTV, saying it might ‘violate mainland rules’, despite HKTV saying that its purchase agreement had concluded. The state-backed giant said it would launch an internal probe into the transaction, although a China analyst quoted in the report said any inquiry by the parent company was ‘unlikely’ to result in a reversal of the deal.