New World Telecommunications

» see newworldtel.com as it lived, on the wayback machine

~ the goodbye ~

HKBN announced it in a letter to "Friends of HKBN" on 1 September 2016. Five months after acquiring New World Telecom in March 2016, it said, the integration was proceeding well and accordingly New World Telecommunications Limited had been renamed HKBN Enterprise Solutions Limited, effective immediately. The rest of the page is photographs of the new Kwai Chung office and a game of billiards.

The company had been incorporated on 14 January 1992, in what was then British Hong Kong, and traded for most of its first decade as New World Telephone. It sat under New World Telephone Holdings, which sat under New World Development, the property conglomerate Cheng Yu-tung built. It picked up a fixed-line telephone license in 1995, when the territory first let anyone other than the incumbent sell one.

After Hong Kong deregulated its telecoms market in 2003, New World Telecom was one of the carriers taking swings at PCCW, which had absorbed the old Hong Kong Telecom monopoly. Households were never the business. More than ninety-four percent of its telecommunications revenue came from commercial customers, its network reached about 491 commercial buildings in the business districts, and in the year to 30 June 2015 the fixed-line and broadband business turned over HK$613 million.

On 18 February 2016 HKBN announced a share purchase agreement with New World Development and its telephone holding company: HK$650 million in cash on a cash-free, debt-free basis, financed by a facility of up to HK$700 million underwritten by JPMorgan Chase. The Communications Authority looked at it and announced on 31 March 2016 that it would not open an investigation under the Competition Ordinance, on the reading that one company sold to homes and the other sold to offices. The deal closed that month. The name lasted another five.

~ the chronicle ~

~ after the monopoly ~

The arc here is the ordinary one for a liberalized telephone market. A monopoly gets opened, licensees rush in, the new entrants spend a decade laying fiber into buildings, and then the survivors buy each other until the market is nearly as concentrated as it was at the start. New World Development had already sold its mobile arm in 2004, so the 2016 sale was the last of it leaving the industry.

The Financial Times put the disposal next to CK Hutchison's sale of Hutchison Global Communications a year later and read both as succession planning, the founding generation of Hong Kong's tycoon families reaching the age where somebody tidies the portfolio. Cheng Yu-tung died in September 2016, the same month the telephone name came off the door.

~ the country with one wire ~

Four companies fighting over the fiber into an office tower is not a market I have ever lived in. Türk Telekom owned the line in Turkey, TTNet was the retail face of it, and the alternatives that existed were mostly reselling the same copper at a different price. I was on TTNet most of the time, with Turknet and Superonline in the dial-up years, and moving between them never once meant a different wire coming into the building.

So the Hong Kong half of this does not translate. New World Telecom spent twenty-four years selling something Turkey had no market for, and the HK$650 million it eventually went for was roughly one year of its own revenue.

~ what the name was worth ~

In June 2016, three months before the rename, fifty-three former New World Telecom supervisors and managers put their own money into HKBN to become what the company calls Co-Owners, and the September letter used that as its proof the integration was working. The domain did less well. newworldtel.com answers today with a content farm under the words "newworld tel GLOBAL TELECOMMUNICATIONS", publishing French-language marketing articles about sneakers and invoicing software under a single repeated byline.

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