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Hutchison announces plan to deliver high speed data services

Hutchison Telecommunications (Australia) Limited (Hutchison) today announced that it plans to become a significant player in the wirefree data market following its successful $671 million purchase of 1800 megahertz spectrum licences.

Hutchison has acquired 15 megahertz of spectrum in both Sydney and Melbourne and 10 megahertz in Brisbane, Adelaide and Perth.

"We are delighted with the outcome of the auction. We now hold a most strategic asset which will secure further growth opportunities for Hutchison over the next 15 years," Hutchison Managing Director, Mr Barry Roberts-Thomson said.

Short term funding for the purchase will be provided by Hutchison's parent company, Hutchison Whampoa Limited. This will be replaced by long term funding later in the year.

Hutchison Whampoa has a strong investment commitment to Australia. Hutchison Whampoa and its associates were one of the biggest foreign investors in Australia in 1999 with interests amounting to over $4 billion. These included stakes in energy and telecommunications.

"Our support for Hutchison's plan to build a high speed data network in Australia is based on its potential to capture growth and additional value in the market for wirefree services," Hutchison Whampoa Group Managing Director and Hutchison Chairman, Mr Canning Fok said.

"Wirefree data is the next major telecommunications opportunity. Hutchison is well positioned to be a significant wirefree provider in Australia with a network that will be specifically engineered for data."

Hutchison plans to construct a high speed data network in each of the licence areas possibly employing GPRS (General Packet Radio Service) technology with EDGE (Enhanced Data for GSM Evolution) enhancement.

"While we are not yet wedded to any particular technology," Mr Roberts-Thomson said, "GRPS with EDGE, which will deliver third generation speeds of 384 Kbps, is indicative of the speed and functionality we will require the successful vendor to deliver. At 384 Kbps, our new network will operate up to 27 times faster than existing mobile networks in Australia.

"We are planning a data service which will be fashioned around this capability and the opportunities we see in the burgeoning demand from business and sophisticated residential users.

"Our plans are well progressed, having drawn on the expertise of the wider Hutchison group. This includes some of the world's leaders in wirefree data innovation," Mr Roberts-Thomson said.

Over the last few months, Hutchison Whampoa has established a number of strategic telecommunications and Internet-related alliances including:

  • Joint venture with Global Crossing to further expand its global connectivity and to pursue fibre optic broadband network opportunities in the Greater China Region.
  • Cooperation with NTT DoCoMo, which owns 19% of Hutchison's mobile communications busi nesses in Hong Kong to offer advanced mobile Internet opportunities.
  • Joint venture with its parent company Cheung Kong (Holdings) Limited, the Hongkong and Shanghai Banking Corporation, and Hang Seng Bank to form iBusiness Corporation.com, to facilitate e-commerce businesses on the Internet.
  • Alliance with Priceline.com to introduce the buyer-driven e-commerce system to Asia.
  • Separate joint ventures with Vanda Systems and Communications, and Computer and Technologies to develop business-to-business payment gateway services and e-commerce application development resource centre respectively.
  • Joint venture with DLJdirect to expand on-line investment services in Asia
  • Joint ventures with Internet Capital Group to pursue business to business e-commerce opportunities

In Australia, the Hutchison data network will expand the reach and range of Orange services.

"We expect to replicate in data the innovation and leadership we have achieved in integrated voice services," Mr Roberts-Thomson said.

Hutchison is currently constructing a CDMA network to provide integrated local and mobile telephony services in and around Sydney and Melbourne. Early results from initial sales of the service have proved encouraging with the company now pursuing plans for a mid year full commercial launch.

Called Orange One, the service allows customers to use their mobile phone at home and be charged landline rather than mobile rates. It has been specifically designed to address the growing need for second and third lines in Sydney and Melbourne homes.

"The Orange One network is primarily a voice services network, but will ultimately also have some data features at circuit switched speeds of 64 Kbps. It will be packaged, priced and promoted to the residential market from mid 2000 onwards," Mr Roberts-Thomson said.

"The 1800MHz network will be primarily for business users who require advanced data services at priority speeds. Some voice services will also be provided."

Each network will serve a distinct market with the mix of data and voice functionality appropriate to those customers' needs.

"Having two networks will enable us to remain focused on these separate needs and manage costs and functionality accordingly," Mr Roberts-Thomson said.

Hutchison will begin the formal selection process for a suitable vendor immediately.

- Ends -

For more information, please contact:

Media Contact
Melina Reed
National Manager Public Affairs, Orange
Tel: (02) 9964 4874 or 0413 622 435

Orange products and services are provided in Australia by Hutchison Telecommunications (Australia) Limited.