Four new licenses are said to be open for bidding by new entrants and the existing players -Television Broadcast (TVB) and Asia Television (ATV) - to operate digital television services, either as a free-to-air broadcaster or as a pay-TV broadcaster, the Hong Kong government's Commerce, Industry and Technology Branch. The licenses, based on the SFN (single frequency network) multiplex, will be awarded through an open competitive process.

According to media reports, the government would base its decision on criteria such as the impact on competition in the market, proposed rollout timetable and geographical coverage of broadcasting, say media reports.

The government, in its second consultation on digital terrestrial television (DTT) broadcasting said the implementation of DTT should not be delayed further, even though the Central Government had not yet decided on a national DTT standard.

It has adopted a market-led approach in setting the technical standard for digital TV. Reports also indicate that since digital TV technology could use spectrum resources much more efficiently than traditional analogue TV, a DTT broadcaster could save up to HK$2.8 million a year on broadcasting channel spectrum fees.

The reports indicate that DVB-T, the American ATSC-T standard and the Japanese ISDB-T standard were considered by the government in its first consultation in 2000. The Central Government is understood to be looking at five different standards, and a final decision is not expected before 2005.

According to the government proposition, both ATV and TVB must provide territory-wide digital coverage, and between 2006 and 2008 they must operate both traditional analogue and digital TV as a transitional measure.

Though the deadline is set for 2006, both TVB and ATV have pressed for the government to defer pushing DTT in Hong Kong in their submissions, as the mainland has not yet promulgated its own standard.