PCCW's UK broadband push

HONG KONG fixed-line phone company PCCW, struggling to find new revenue streams, is set for a heavy investment in the British wireless broadband market, with some analysts predicting total investment in the coming years of up to £500m.

The company has already said it will invest an initial £22m in the commercial roll out of its service here next year.

PCCW has hired ad giant Saatchi & Saatchi for a big campaign push in Slough, Reading, Windsor and Maidenhead where the service is expected to be extended first.

Deputy chairman Jack So Chakkwong told the South China Morning Post that 900 base stations would eventually be set up around Britain, which could be used to provide telephone services.

Ian Stone, who heads PCCW's British unit, said recently that the company would begin offering some internet voice services next year.

The initial roll-out follows a successful trial of PCCW's proprietary wireless fixed platform in 300,000 homes in west London.

'We have drawn a very good response when putting the services on trial,' So said. 'Our technology has been proven viable and we have decided to roll out the services in stages next year.'

The service, dubbed Netvigator, will compete head on with BT and other cable firms which have seen poor take-up for broadband.

The first stage would involve the establishment of 60 base stations, with precise locations and a time frame yet to be finalised, but So kept the way open for a much greater investment.

'We'll review the numbers while rolling out the services,' he said.

'As equipment gets cheaper and consumer demand gets stronger, the total project cost could be cheaper.'

PCCW last year bought 15 British licences, paving the way for a nationwide roll-out.

The company, controlled by Richard Li, son of Asia's richest man Li Ka-shing, will be hoping for a swift take-up of the new service, having failed to produce major new revenue sources to offset losses over the past three years due to intensifying competition .

So also flagged the redevelopment of PCCW's 80 telephone exchange buildings in Britain, which have an estimated total floor area of more than one million square feet.

He said the company was in talks with the Government over redevelopment plans, although only some of the telphone exchanges would be revamped.

'Before we make any decisions on the redevelopment, we need to come to an understanding with the Government over a policy, which will state clear rules on change of land use and the calculation of land premium,' So said.