Hong Kong Ready to Set Up Internet Peering Hub: Interview

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Last updated at: (Beijing Time) Sunday, June 30, 2002

Hong Kong Ready to Set Up Internet Peering Hub: Interview

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With its excellent telecommunications infrastructure and unique position vis-a-vis the Chinese mainland, Hong Kong has a strong competitive advantagein setting up an Asia Pacific regional internet peering hub, a senior telecom official said on Sunday.

In his exclusive interview with Xinhua, Tony Hou, chairman of Internet & Telecom Association of Hong Kong, said his association has made investigations and proposed the setting up of an internetpeering hub for the Asia Pacific region based in Hong Kong.

"So far, the relevant government departments in the Chinese mainland and the Hong Kong government have paid close attention tothe proposal," Hou said.

Hou said, for better efficiency in terms of cost and network resources utilization, instead of having each Asian country and region connect back to the United States, it will be better for Asia Pacific traffic to be exchanged directly amongst Asian countries and regions and this would keep inter-Asia traffic within the region.

He said the association also proposed that the local governmentshould assume a key role in setting up an Asia Pacific task force for establishing governance and standards pushing for the systematic implementation of IPv6 in the region, and this would mirror the efforts and actions in this respect already taken in the United States and the EU.

There are two large internet exchanges around the world, with the New York International Internet Exchange in America serving the international and the U.S. domestic ISP market and the Amsterdam Internet Exchange in Europe serving as an neutral and independent internet exchange, while there is no equivalent for the Asia Pacific region.

A recent research by the Nielsen/NetRatings survey revealed that the number of Internet users in China had surpassed the totalof other Asia Pacific countries to rank just the second globally to the United States, representing only about five percent penetration to the market that leaves a lot of potential for the future growth. Inevitably, the supply and demand between China andother countries will increase rapidly.

"This gives China a distinct competitive advantage to assume the role as a main Internet center both in the Asia Pacific regionand globally," Hou stressed.

However, Hong Kong, with its unique position as a part of Chinawith an open market policy, a free flow of information, a well-structured regulatory environment and a trusted position as a leading financial center, has the opportunity to former partner with the mainland to assume this leadership position to set up such an exchange, he added.

Hong Kong is one of the first cities in Asia to introduce GPRS service and the first to introduce a broadband-based interactive television. In Hong Kong, there are 4.4 million Internet users fora population around 7 million people and 80 percent of the population has mobile phones.

In addition, there are over 500 telecom-related establishments in Hong Kong providing employment for 30,000 people, over 98 percent of households and more than 95 percent of business buildings are covered by broadband connections, and 60 percent of the households have installed personal computers.

"By building a high-speed information highway between China andother Asia Pacific countries and a regional Internet peering hub in Hong Kong, Hong Kong would increase its core competence and also attract more investment from overseas service providers," Housaid.

Hou concluded that having an Internet peering hub based in HongKong not only makes sense from an infrastructure point of view, but would ensure that productivity gains from the information technology sector ripple through to the entire economy.

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