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Pacific Century Cyber Works

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Pacific Century Cyber Works

PCCW Ltd.
Public
Traded as 0008
Industry Telecommunications
Founded In August 2000, PCCW acquired Cable & Wireless HKT (originally The Hong Kong Telephone Company Ltd., formed in 1925)
Headquarters Hong Kong
Key people Richard Li, Chairman, Alex Arena, Group Managing Director
Products Fixed-line, Broadband Internet access, IPTV, Mobile, IT Solutions, Data Centers, Contact Centers, Integrated Global Communications, Infrastructure, Advertising and Interactive Services
Employees 19,300 (2010)
Website www.pccw.com/eng

PCCW Limited (Chinese: 電訊盈科有限公司) is the holding company of HKT Group Holdings Limited, a Hong Kong based information and communications technology (ICT) company. PCCW also holds a majority interest in Pacific Century Premium Developments Limited. PCCW is headquartered in Hong Kong and operates in Europe, the Middle East, Africa, the Americas, mainland China and other parts of Asia.

PCCW shares are listed on American depositary receipts on the OTC Pink market in the US (Ticker: PCCWY).

Main business

HKT Group Holdings Limited (HKT) was formed in 2008 to hold the telecommunications services, media and IT businesses of the PCCW Group in a reorganization designed to improve the Group's operational efficiencies. PCCW/HKT was the first quadruple play provider in Hong Kong, and offers media content and services for fixed-line, broadband Internet, TV and mobile. The group sells to local and international business customers, as technical services and project outsourcing to network operators and public and private sector organization.

PCCW/HKT has more than 8,000 PCCW Wi-Fi hotspots in food outlets, shopping malls, universities, and public transport.

Commercial and International business

The PCCW Commercial Group provides ICT services to small, medium and large enterprises. The group managed the installation of Asia's largest IP-enabled network for securities and derivatives markets, built for Hong Kong Exchanges and Clearing Limited and known as SDNet. It includes an electronic passport system, known as e-PASS, and the Smart Identity Card system for the Hong Kong SAR Government.

PCCW Teleservices operates a contact centre outsourcing business along with an operation in the U.S. It handles inbound and outbound calls, emails and other transactions for customers.

PCCW Global runs a fully meshed IP, fiber and satellite network, providing voice, data and multimedia for multinational enterprises, as well as service providers.

Geographical operations

PCCW's businesses have a presence in the following regions:[1]

Fixed-line.

PCCW's fixed-line service, eye Multimedia Service and PCCW eye2 are delivered by Hong Kong Telecommunications (HKT) Limited, an operating division of HKT Group Holdings Limited. The Group's fixed-line network enables users to make local and international phone calls with voice availability of 99.99%.

The eye Multimedia Service allows users to make voice or video calls, watch TV, access a digital music service, and run consumer entertainment and finance applications. PCCW eye2 is a portable media center with an 8-inch (200 mm) touch-screen LED monitor, through which customers can access more than 100 types of content and interactive applications.

Broadband internet.

As one of the Group's four quadruple-play platforms, NETVIGATOR a broadband provider. It reaches 97% of all households in Hong Kong with a choice of Internet access speed and services. The capabilities of optical fiber are available to 67% of Hong Kong's households via a variety of NETVIGATOR Fiber Direct service packages.[2]

NETVIGATOR broadband users can can use NETVIGATOR Home Wireless, as well as PCCW Wi-Fi hotspots and NETVIGATOR Everywhere, a wireless service interconnecting Wi-Fi HSPA networks.

Mobile.

PCCW mobile is an operating division of HKT Group Holdings Limited (HKT).

As well as providing voice and data communications, PCCW mobile offers media content and interactive services as one of the Group's four quadruple-play platforms. This enables subscribers to choose mobile services, such as real-time TV, streamed digital music, shared viewing of photos and video clips, remote monitoring, ticketing, instant messaging, email solutions and an integrated fixed/mobile office communications.

IPTV

now TV is an IPTV and pay-TV provider in Hong Kong. It is delivered by PCCW Media, an operating division of HKT Group Holdings Limited (HKT). now TV serves Hong Kong with more than 190 channels of local, Asian and international programming, including premium content such as Spanish La Liga, Italian Serie A, French Ligue 1, J-League, French Open, ATP World Tour, and World Snooker Tour. In addition, now TV is a producer of news, sports and infotainment programming and a provider of interactive services. now TV can be viewed on PCCW eye2, a portable media center with an embedded decoder, and select now TV content and interactive applications can also be accessed via the group's 3G mobile network and broadband service.

PCCW Engineering.

PCCW announced the formation of wholly owned subsidiary CASCADE Limited in January 2003, and transferred almost a quarter of its work force to Cascade. Cascade employed more than 3,000 staff as of June 2003. Cascade provides PCCW's telecommunications network operations with support and maintenance services. It provides also network infrastructure design, build-out and maintenance services, consulting solutions, customer installation and maintenance services, project management, operating systems development and maintenance and technical support to clients other than PCCW. Started from Dec 08, Cascade became a Subsidiary of PCCW-HKT Limited, which PCCW-HKT is still 100% owned by PCCW. The name of Cascade is removed from now on, become a part of HKT and named as "Engineering", a business unit of PCCW-HKT, simply like Commercial group of PCCW. All staff in Cascade had transferred to PCCW-HKT without changing. [3]

PCCW Global

PCCW Global is an operating division of HKT Group Holdings Limited (HKT). With centers in Hong Kong, Herndon, Virginia in the US, London in the UK, and Dubai in the United Arab Emirates, plus teams covering the Middle East, Africa, Europe, Asia and the Americas, PCCW Global supply voice and data services to multinational enterprises and service providers. The PCCW Global network covers over 1,800 cities and 120 countries, and supports a list of integrated global communications solutions which include:

  • IP solutions;
  • Transmission solutions including fiber and satellite;
  • Managed services and solutions; and
  • Voice services.

Incident with YouTube

On 24 February 2008, Pakistan Telecom caused a major interruption of access to the video sharing website YouTube.[4][5][6][7] Pakistani Government authorities directed Pakistan Telecom (PTCL) to "block" the YouTube site, to prevent access within Pakistan. PTCL engineers accidentally leaked a "black hole" announcement to PCCW. PCCW had recently provided temporary access to PTCL in order to restore the nation's loss of internet access due to a previous major submarine cable break event. PTCL began leaking the "black hole" BGP announcement to PCCW prior to PCCW's completion of the BGP validation and filtering policies process on the newly activated link. This allowed the announcement to propagate to other networks.

Once detected, PCCW immediately blocked the leaked announcement from PTCL and access was restored to YouTube within 2 hours." [8][9]

PCCW Solutions (Unihub, Business eSolutions)

PCCW Solutions is the information technology services and business process outsourcing (BPO) division of PCCW. Press releases prior to February 2006 refer to it by the name Unihub. It is owned by Wen Yunsong, son of China's prime minister Wen Jiabao.[10] Unihib was a re-branding of PCCW's Business eSolutions division, from 1 September 2003.[11]

Business eSolutions division formed a venture with China Telecom to provide IT solutions to major business organizations in 2002. This was in addition to PCCW's PCITC alliance with Sinopec, formed to serve Sinopec plus other players in China's petrochemical sector. The division also contributed to the new Hong Kong Identity Card system in 2003.[10]

In early 2003, Business eSolutions entered a contract to provide services for Bank of China's credit-card back office processing system in China. It also extended a 2002 enterprise resource planning (ERP) project into more provinces for China Mobile and completed the flight information display system (FIDS) for Xiamen Airport, and a human resource management and financial management system for the Hong Kong Council of Social Service.

PCPD

Majority-owned by PCCW, Pacific Century Premium Developments Limited ("PCPD", SEHK: 00432) develops and manages property and infrastructure projects, as well as investment in buildings in the Asia-Pacific region.

PCPD holds the development rights for the Cyberport project, which is owned by the Government of the Hong Kong Special Administrative Region and includes the Bel-Air residential development.

Apart from the Bel-Air residential development, PCPD holds the right of first refusal to join with PCCW to redevelop PCCW-owned telephone exchange buildings into residential and / or commercial properties.

UK Broadband

The UK Broadband Group (UKBG) provides equipment and wireless services and solutions to the telecommunications industry, service providers, channel partners and the public sector in the U.K. The Group holds multiple licenses for both fixed and mobile spectrum. It offers include 4th generation Wireless Technology (4G), Wi-Fi, Wireless Ethernet and fixed high-speed wireless link services, as well as wholesale wireless data capacity. UKBG is a wholly owned subsidiary of PCCW and it combines the role of being PCCW's 4G wireless technology centre with building a wireless services, and wholesale data capacity business in the UK focused on B2B and B2G customers, in particular the public sector and businesses looking for wireless data solutions for their needs in CCTV, mobile working, education, healthcare, disciplined services, transport, data offload, wireless Ethernet and resilient connectivity.

In reality, although the company won several of the auctions for UK fixed wireless broadband access licences in 2004, and purchased several more in post-auction deals, its UK consumer wireless broadband service (known variously as Netvigator, and later Now! Broadband) has never had a significant roll-out and subscriber numbers are negligible in comparison with the potentially addressable market. Their Netvigator service has actually closed down in some geographies where a service was initially offered.

Corporate social responsibility

Community services - PCCW provides communications services for a variety of social service schemes. This includes support for students, single parents, the unemployed, distressed people and the elderly who benefit from counseling hotlines, info-line services for Medilink and networks to help find employment.

Each year, PCCW provides practical and financial help to charitable, community, cultural and environmental causes[which?].

PCCW has been a member of the Environmental Committee of the Hong Kong General Chamber of Commerce since the early 90s. The Committee periodically meets to discuss environmental issues such as Hong Kong air quality and carbon reduction measures. PCCW has also been a Board member of Business Environment Council (BEC) since the early 90s and was one of the founding members of Private Sector Committee on the Environment (PSCE).

Education

The PCCW foundation has provided sponsorship for local data network service for the Internet2 project initiated by the Joint University Computer Centre (JUCC). The project enables staff and students at local universities to connect and exchange with Internet2 universities all over the world in researching the next generation of networking technologies. The foundation also supports the Workplace English Campaign and other education-related initiatives, such as annual scholarships for top students nominated by local universities.

Corporate history

PCCW was formed by Richard Li, the younger son of Hong Kong tycoon Li Ka Shing. Formerly Pacific Century Development, it was an investment holding company. The company's English name was changed from "Pacific Century CyberWorks Limited" to "PCCW Limited" on 9 August 2002.

It then won a controversial land deal, acquiring valuable waterfront real estate from the government without any public auction bids. The Hong Kong Government, under chief executive Tung Chee Hwa, gave away the land to his new high-tech residential and commercial venture called Cyberport.[12]

The stock of Pacific Century CyberWorks rose from HK$6.00 to HK$19.50 between December 1 to 28, 1999. Dec 23 is a Heritage of Pacific Century CyberWorks, break record of single company in Hong Kong history with a HK$5 billion transaction. Pacific Century CyberWorks become the seventh (value over HK$170 billion) listing company in Hong Kong Exchange on Dec 28, 1999.

PCCW acquired Hong Kong Telecom (HKT) in August 2000, which was formerly known as the "Hong Kong Telephone Company" (founded in 1925). Initially, HKT owner Cable & Wireless entertained a bid from Singapore Telecommunications, but there was Beijing concern about a Singapore company owning the largest Hong Kong telephone system. PCCW entered the scene and offered Cable and Wireless PCCW stock and US$11 billion in bank loans by HSBC, Bank of China, BNP Paribas & Barclays. The acquisition vaulted PCCW from a dot-com holdings company to one of the largest universal corporations in Hong Kong. PCCW is now also the leading Internet service provider in Hong Kong, using the Netvigator brand for dialup modem and DSL service. PCCW has been the object of much scorn in Hong Kong as a result of the HKT purchase. In 2003 the company's stock price was down 96 percent from its 2000 peak. In the face of challenges due to debt, intense local telecoms competition and a struggling international joint venture Reach (50/50 owned by PCCW and Telstra), PCCW was the worst-performing blue chip on the Hong Kong Stock Exchange (HKSE) in 2002 and 2003.

In 2003, Cable and Wireless finished cashing in all the stock from the 14.7 percent stake it had in PCCW. Worth US$5 billion at the time of the 2000 acquisition of HKT, the stock sales yielded only $1.9 billion in the end.

Richard Li gave up his spot as PCCW's chief executive officer in July 2003 but remained as chairman and executive director. Jack So, who left his chairman position at Hong Kong subway operator MTR Corporation Limited, took up the job of group managing director at PCCW on 25 July 2003.

Attempted exit

Although PCCW's substantial shareholder China Netcom had earlier expressed objection to any disposal of key assets to foreign groups, it also refused to increase its stake; Richard Li attempted to exit from the business in 2006. Li received competing offers by two consortia led by Australia's Macquarie Bank and private equity firm Texas Pacific Group/Newbridge submitted expressions of interest last month to acquire PCCW's core telecom and media assets.[13]

PCCW chairman Richard Li has agreed to sell his indirectly held 22.66 percent stake in PCCW on 11 July 2006 to Fiorlatte Ltd, a new startup company wholly owned by Francis Leung Pak-to, for a total consideration of HK$9.16 billion. In turn, Francis Leung Pak-to has agreed to sell an 8% stake in PCCW to Telefónica for 323 million euros. Leung, former Peregrine investment banker, is closely associated with Li Ka-shing. PCCW's stock, which had joined Hang Seng Index (HSI) index on 9 August 2000,[14] ceased to be a HSI constituent, effective 10 June 2008.[15] PCCW

Purported Cable & Wireless takeover bid

News report from the Sunday Times on 6 February 2003 revealed that PCCW made a preliminary takeover approach to Cable & Wireless on December 2002 as the British company's share languished near record lows.[16]

Li told the Sunday Times newspaper that PCCW would not launch a hostile bid for C&W but that the two companies could work together to enhance shareholders' value.

The Times quoted Li as saying that he was planning to try again that week with a two billion pound (US$3.27 billion) bid for C&W. Following the news report, PCCW issued a statement through the Hong Kong stock exchange on 6 February 2003 morning saying it had not made a formal offer for C&W and was not in takeover talks with the company. Later in the day, in London and Hong Kong, PCCW issued statements saying it had made a preliminary takeover approach to C&W in a letter at the end of 2002.

PCCW apologised on 10 February 2003 for making what were seen by some in the market as contradictory statements. The Hong Kong Stock Exchange demanded an explanation from PCCW after noting discrepancies between the two statements regarding its approach to C&W about a possible bid.

In any case, C&W had rebuffed PCCW's takeover approach by February 2003.[17]

Privatization plan

An attempt was made in December 2008 to take the company private. On 30 December, majority shareholders Pacific Century Regional Developments, controlled by Richard Li, and China Unicom Group raised their joint offer for PCCW from HK$4.20 a share, minutes before shareholders were due to vote on the original buyout plan.

In a heated shareholders meeting held on 4 February 2009 which lasted seven and a half hours, the shareholders approved the PCCW plan allowing its majority shareholders to force out all minority shareholders of the company amidst allegations of vote-buying.[18] Privatisation would allow PCCW to be delisted from Hong Kong Stock Exchange,[19] while its parent would remain listed in Singapore.

Governance activist David Webb alerted the authorities to allegations that hundreds of agents at Fortis Insurance Co. (Asia), once part of PCCW, may have been given board lots of 1,000 PCCW shares.[20] The Securities and Futures Commission found that Francis Yuen, a Li associate and member of the buyout group, had instructed a senior executive at Fortis to distribute PCCW shares to about 500 Fortis agents. Yuen and Fortis Asia regional director, Inneo Lam, had exchanged telephone calls shortly before Lam ordered half a million PCCW shares that were later split into board lots and given away to his staff;[21] Lam's secretary had asked for, and received, share transfer forms from Yuen's secretary. Majority shareholders gained approval from the High Court to proceed in their US$2.2 billion privatisation, but the Appeals Court unanimously overturned the ruling.[22]

See also

References

External links

  • PCCW Homepage
  • PCCW Mobile
  • PCCW Solutions
  • Netvigator (Internet Services)
  • now TV (Digital TV Services)
  • Yahoo! - PCCW Limited Company Profile

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