Smartone Telecommunications Holdings Limited · HKEX:315

Smartone Telecommunications — Corporate Update (April 2009)

12 slides from Smartone Telecommunications's corporate update, Apr 20, 2009

  1. Slide 1: Fixed-mobile Interconnection Charge (FMIC)

    Fixed-mobile Interconnection Charge (FMIC, 固定流動網絡互連費用) 20 April 2009

  2. Slide 2: Background: OFTA's statement on Fixed-Mobile Convergence

    Background ƒ OFTA’s statement on Fixed-Mobile Convergence (固定流動匯流) on 27 April 2007 concluded that: ƒ The regulatory guidance on FMIC in favour of Mobile Party’s Network Pay (“MPNP”, 流動網絡付費) will be withdrawn after 26 April 2009 ƒ Operators are encouraged to reach a commercial agreement with each ot

  3. Slide 3: Background: OFTA's statement on 3 April 2009

    Background ƒ OFTA’s statement on 3 April 2009 confirmed that: ƒ The withdrawal of the MPNP regulatory guidance will take effect after 26 April 2009 ƒ OFTA will ensure that “any-to-any connectivity” will be maintained 3

  4. Slide 4: SmarTone-Vodafone's position is Calling Party's Network Pay

    SmarTone-Vodafone’s Position on FMIC ƒ SmarTone-Vodafone’s position is Calling Party’s Network Pay (“CPNP”, 打出網絡付費) ƒ The only fair interconnection charging principle as the call originating network should pay ƒ CPNP is the international standard in most advanced economies with open and competitive

  5. Slide 5: MPNP is contrary to fair competition

    SmarTone-Vodafone’s Position on FMIC ƒ MPNP is contrary to fair competition ƒ A legacy from long ago ƒ Mobile operators are effectively subsidising fixed operators in what is now an open and competitive market ƒ Technology and the industry globally are heading towards Fixed-mobile Convergence. MPNP

  6. Slide 6: Under CPNP, mobile operators will have a net receivable

    SmarTone-Vodafone’s Position on FMIC ƒ Under CPNP, mobile operators will have a net receivable from fixed operators ƒ Traffic between fixed and mobile networks is slightly imbalanced ƒ Higher volume of fixed-to-mobile calls than mobile-to-fixed calls ƒ Mobile termination rate is higher than fixed te

  7. Slide 7: Hong Kong's regulatory practice on interconnection rate determination

    SmarTone-Vodafone’s Position on FMIC ƒ Hong Kong’s regulatory practice on the determination of interconnection rate is based on: ƒ Cost recovery principle ƒ Long Run Average Incremental Cost ƒ The principle of most efficient network operation (i.e. lowest cost) ƒ FMIC, last determined in 2004 betwee

  8. Slide 8: After – What's Next? Existing agreements terminated

    After 26 April 2009 – What’s Next? ƒ Existing MPNP interconnection agreements with all fixed operators will be terminated after 26 April 2009 ƒ Customers will not be affected ƒ OFTA will ensure “any-to-any connectivity” ƒ Charges to customers are market-driven and have nothing to do with the cost se

  9. Slide 9: After – What's Next? Ensuring any-to-any connectivity

    After 26 April 2009 – What’s Next? ƒ To help ensure “any-to-any connectivity” ƒ SmarTone-Vodafone will continue to monitor closely the interconnection performance with all fixed networks ƒ Any signs of abnormal interconnection performance will be reported to OFTA immediately for further action ƒ Our

  10. Slide 10: After – What's Next? OFTA's powers and penalties

    After 26 April 2009 – What’s Next? ƒ If any licensee undermines the “any-to-any connectivity”, OFTA has the power to: ƒ Impose a financial penalty ƒ First occasion: HK$200K maximum ƒ Second occasion: HK$500K maximum ƒ Any subsequent occasion: HK$1 million ƒ If OFTA considers the above is insufficien

  11. Slide 11: Appendix 1 - Overseas FMIC Regimes in Open and Competitive Markets

    Appendix 1 - Overseas FMIC Regimes in Open and Competitive Markets Country FMIC Regime Fixed-to-Mobile Calls Mobile-to-Fixed Calls EU Countries CPNP (with asymmetrical Fixed operators pay Mobile operators pay (15 countries) rates, MTR>FTR) USA CPNP (with symmetrical Fixed operators pay Mobile operat

  12. Slide 12: Appendix 2 - Mobile and Fixed Termination Rates in European Countries

    Appendix 2 - Mobile and Fixed Termination Rates in European Countries Mobile Termination Rate Fixed Termination Rate Country (HK$/min) (HK$/min) Sweden 0.45 0.06 Finland 0.52 0.19 France 0.67 0.05 UK 0.75 0.01 Austria 0.59 0.08 Belgium 0.85 0.06 Germany 0.80 0.05 Denmark 0.83 0.04 Spain 0.70 0.07 Ir

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