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One Country, Two Frequencies for China, HK

Hong Kong -- When China regained sovereignty over Hong Kong
last July, the phrase "one country, two systems" became a mantra.

The phrase was meant to explain how the world's
largest Communist nation would allow the epitome of savage capitalism to not only survive,
but flourish, under its eye.

So far, the reorganization of the regulatory agencies
supervising broadcasting and media affairs in Beijing and the Special Administrative
Region of Hong Kong appears to bear out the "one country, two systems" saying.

While Beijing has implemented token administrative reforms
that change almost nothing, according to one industry observer there, Hong Kong has rung
in pragmatic shifts to cope with changing economic and technological realities.

In other words, Chinese media policy remains an instrument
of state control and propaganda among conservative Communist Party cadres in Beijing,
while the bureaucrats in Hong Kong are at least trying to establish a regulatory framework
that will give it a competitive edge at home and abroad.

The Hong Kong Broadcasting, Culture and Sport Bureau's
overreaching charge has been given a new focus as the retooled Technology and Broadcasting
Bureau (TBB), which will concentrate on TV, radio and information-technology issues.

Over on the mainland earlier this year, Chinese premier Zhu
Rongji outlined a massive reorganization of government ministries that was meant to
consolidate the administration and slash tens of thousands of jobs from the country's
bloated government payroll.

Telecommunications regulator Ministry of Posts and
Telecommunications (MPT) was renamed the Ministry of Information and Industries (MII)
after merging with the Ministry of Electronics Industry.

At the same time the Ministry of Radio, Film and Television
(MRFTV) became the State Administration for Radio, Film and Television (SARFT), which is
an inferior state body in the Chinese nomenclature.

But any real change could be as subtle as a Confucian
proverb. A Beijing-based analyst, who asked not to be named, said, "It sounds like a
lessening of its [the state body's] power, but its head is still described by the
Chinese in an English translation as a 'minister,' and under him are
'vice-ministers.' That is not a lessening of power at all."

Broadly, the MII will have day-to-day control over
broadcasting policy, leaving the SARFT in charge of issues such as cable TV policy in the

In the analyst's view, the movements in Beijing
reflect little more than Communist Party sword rattling and power struggles, despite some
sentiment that they were the first signs of a liberalization of broadcasting policy that
could eventually open the mainland more to Western programmers.

The analyst believed there is an inexorable move toward
enlarging the Ministry of Culture into a single entity responsible for broadcasting.
Former MRFTV minister Sun Jia Zheng became Culture Minister as a result of Zhu's
reforms earlier this year.

He added that Sun is a powerful figure who lobbied strongly
for the MRFTV's powers to be kept intact before the creation of the SARFT. There is
speculation that the "super" culture ministry could be a reality in two to three

Kaushik Shridharani, a regional media analyst with Salomon
Smith Barney, is moderately optimistic about the MII's stewardship. He believes that
telecommunications has seen the most policy liberalization of any industry, as China
actively works to increase telephone penetration from the 1995 estimate of less than five
per 100 people.

Given the cautious easing of restrictions sanctioned by the
MRFTV before it was dissolved, which included approval of plans for direct-to-home
satellite transmissions, it seems that "the ice is beginning to break open,"
reckons Shridharani.

However, the analyst in Beijing warned against undue
optimism. His caution is based on the lack of clearly delineated responsibilities between
the MII and SARFT on operational issues.

"If a cable service wants to add a new channel, if a
provincial station wants to uplink to a satellite for wider distribution, who does it go
to for permission?" he asked.

Issues like these could spark inter-ministry battles that
are only likely to be settled with the creation of a single policy overlord.

In Hong Kong, Shridharani sees the creation of the TBB as
the government's admission that something had to be done about its broadcasting
policy. The preservation of cable operator Cable TV's monopoly in the territory and
the migration of international programmers to Singapore had given the rest of the world
the impression that Hong Kong was either unwilling to harm local interests, or that the
industry enjoyed a low priority compared with others like financial services and
telecommunications, which are the most deregulated in Asia.

Shridharani warned that more coordination is needed unless
Hong Kong wants to fall further behind the rest of Asia. He cited the announcement that
Singapore was entering into a partnership with private enterprise to introduce digital
terrestrial TV by the end of year as an example of the island republic's enthusiasm
for new technology.

Under the accord, the private Advent TV is expected to use
a digital frequency to broadcast programming from government-owned Television Corp. of
Singapore by early next year.

Hong Kong officials, in contrast, are at least a year away
from even allocating digital spectrum.

Attempts to gauge views of the new secretary of the TBB,
Kwong Ki-chi, who claims to be a huge proponent of IT matters, will have to wait until
early this month, when he returns from a monthlong leave period and starts his new job.

Mandy Au Yeung, an information officer with the Hong Kong
government, commented only that authorities remain committed to a level playing field for
all those who wish to base themselves in Hong Kong.

That's swell. But Hong Kong's broadcasting policy
will remain intact until the results of a wide-ranging review, which will examine issues
such as competition in the pay TV industry, are disclosed in the last quarter of this
year. So, while Hong Kong prepares for yet another study, it will find itself slipping
further behind the rest of the region, which is busy implementing actual polices.