- Born in Hong Kong
1979 - Age 13, sent to California, attends Menlo Park
1983 - Goes to Stanford, obtains degree in computer
1987 - Age 21, moves to Canada, works at Gordon Capital
1990 - Returns to Hong Kong to work for father's
company Hutchison Whampoa
May 1991 - Establishes STAR satellite television
July 1993 - Sells controlling stake (63.6%) in STAR to
Rupert Murdoch's News Corp. for $525m; subsequent deal in 1995 for total
News Corp. control takes sale total to $950.5m
1993 - Launches Pacific Century Group (PCG)
Nov 1995 - March 1997 - Develops real estate projects
in Toronto, southern China, Beijing and Tokyo
March 1998 - PCG announces joint venture with Intel
(with 40% stake) called Pacific Century Convergence Corp. to develop
information technology systems
March 1999 - Hong Kong government announces award of
Cyber-port project to PCG which pledges to invest around $1bn
May 1999 - Announces reverse takeover for Hong
Kong-listed Tricom, which is renamed Pacific Century CyberWorks; pays
$315m for the deal
May 1999 - Announces creation of CyberWorks Ventures, a
listed high-tech venture capital investment fund
May 1999 - Joint venture created with Credit Suisse
First Boston to manage and invest in Asian properties
August 1999 - launches Pacific Century CyberWorks
August - October 1999 - spends some $600m buying stakes
in 13 information technology companies -
Richard Li buys Cable & Wireless HKT for $38 billion (USD)
Richard's date last night made HK media headlines
Ella Liang 梁芳,
aged 27 is born to Mira Yeh's brother who is a trained architect, and a European
mother. Educated in the UK and trained as a
barrister, Ms. Liang moved to Hong Kong recently joined a medium sized firm this September in Queensway.
-- Front Page, APPLE
DAILY 2011 October 4
Fingers crossed. Hope
this romance works for the Chief now that his business life is running
smoothly. He deserves a break and is one
of the most far-sighted and Action leaders in this world.
Richard's Business Trust
PCCW's proposed listing of its telecom assets in the form of a trust and Swire
Properties' listing by introduction will bring two blue-chip Hong Kong assets
to the market--- something rarely seen these days.
New listings by pure Hong Kong companies
are a rarity these days when virtually all IPOs on the Hong Kong stock
exchange are by companies based either in China or some other country outside
our borders. The reason, of course, is that most Hong Kong companies are
So it is interesting to see not just one, but two major Hong Kong businesses
preparing for a listing in the next few months, namely Swire Properties and HKT
Trust, which comprises PCCW’s telecommunications business. Both are spin-offs
from companies that are already listed, but account for the majority of
revenues and profits at their respective parent companies, making this an
interesting exercise not just for the unit that is being spun off, but for the
parent company and its shareholders as well.
The two listing candidates have chosen different routes towards their separate
Swire Properties, the property development and investment unit which is
currently wholly-owned by Swire Pacific, said in statement at the end of last
week that it has decided to list by introduction. This means that it won’t be
issuing any new shares, although it will distribute about 17% of Swire
Properties’ share capital to existing investors in Swire Pacific.
PCCW on the other hand is aiming to float its telecom assets on the Hong Kong
stock exchange in the form of a dividend-paying trust and said over the weekend
that it may raise about $1.3 billion, assuming it is able to sell as much as
40% of the trust and based on a valuation floor that translates into a dividend
yield of about 9%.
Swire’s announcement is a change from its earlier plan, which saw Swire
Pacific pursue a Hong Kong IPO in late April/early May last year. The company
was aiming to raise up to $2.7 billion by selling about 15% of its share
capital, but called off the deal a day before pricing amid a deteriorating
The cancellation was a big disappointment for the group as the property unit
needed money to finance its continued expansion, particularly in China. Swire
Pacific was also keen to equip Swire Properties with its own funding platform
so that it would be able to more easily raise additional capital as and when
needed. Hence, there has been a lot of speculation about whether Swire
Properties would make another attempt at an IPO. The volatile market
environment that has persisted for much of this year is making new listings
challenging, however, and would also likely require the shares to be sold at a
big discount to net asset value – something that would probably not go down
well with Swire Pacific’s existing shareholders.
However, a couple of month ago, Swire Properties sold its Festival Walk mall in
Hong Kong to Singapore’s Mapletree Investment for HK$18.8 billion ($2.4
billion), which means it now has enough capital to cover its current funding
requirements without having to sell new shares.
But the group still wants to create a platform for future fund raisings and a
listing by introduction will achieve that without the company having to take
any market risk. According to last week’s statement, the plan is to
distribute 10% of Swire Properties’ share capital to the public shareholders
of Swire Pacific and another 7% to John Swire and Sons (JSS), which is the
controlling shareholder of the parent company. This ratio means the ownership
structure between controlling and minority shareholders will be the same for
both Swire Pacific and Swire Properties. JSS owns approximately 39% of Swire
Pacific’s share capital and 56.8% of the voting rights.
Since Swire Pacific’s shareholders will receive the shares in Swire
Properties for free this should be a fairly uncontroversial exercise. And with
the property division accounting for 76% of Swire Pacific’s total asset value
and the parent company having a market capitalisation of about $9.8 billion, a
10% free-float should result in decent liquidity in the stock – something
which is otherwise a big problem when it comes to listings by introduction.
PCCW is taking an altogether different approach to the spin-off its telecom
business, which it acquired from Cable & Wireless in 2000. Floating the
assets as a dividend-paying trust, allows PCCW to raise cash for debt
repayments and at the same time distribute a bigger portion of the earnings
from the telecom business to shareholders.
The listing vehicle will not be a business trust as the regulatory changes
needed to allow such vehicles to list in Hong Kong are not yet in place – it
is being referred to as a fixed single investment trust. However, the company
and its bookrunners have come up with a structure that is very similar to the
business trusts listed in Singapore, but works under the current Hong Kong
listing rules. One key difference, according to sources, is that it will only
take 50% of the shareholders’ vote to remove the trustee and management
companies, compared to 75% for Singapore business trusts. Also, there will be
no regulatory requirement with regard to how much dividend the trust needs to
pay, although PCCW has said that HKT Trust will pass on 100% of the adjusted
funds flow to its unitholders.
PCCW’s controlling shareholder Richard Li, the youngest son of Hong Kong
tycoon Li Ka-shing, will be hoping that he has finally found a structure that
will be acceptable to minority shareholders after several failed attempts to
take PCCW private in recent years.
In a statement issued on Sunday, that provided further details on the proposed
structure, PCCW argued that a separate listing of the telecom business will
unlock value for shareholders and better identify and establish the fair value
of the telecom business. It will also create a more defined business focus and
efficient resource allocation with regard to the telecom business, and at the
same time increase the visibility of PCCW’s remaining businesses – media,
solutions and properties.
And it will boost the financial resources, both for the telecom business and
for PCCW, the company said.
The first HK$7.8 billion ($1 billion) of the net IPO proceeds will go to HKT
and will be used to reduce its debt. This will ensure that more cash will be
available to distribute to the unitholders. Any proceeds above that will go to
PCCW and will go towards additional investments in its growth businesses, such
as the media and solutions businesses, with the aim of creating value for its
The company earlier this month said that HKT Trust will be listed in the form
of share stapled units, which will have three components: a unit in HKT Trust;
a beneficial interest in one ordinary share of HKT Limited that is linked to
the unit; and a preference share in HKT Limited that is stapled to the unit.
And on Sunday it said it will sell between 25% and 36.7% of these share stapled
units as part of a global offering, or up to 40% including a greenshoe. At the
top end of the range, pre-shoe, the net proceeds are estimated to be $1.3
billion and at the bottom end about $873 million. This assumes a price per unit
that translates into a 9% yield, based on the company’s cash flow projections
One source noted that the 9% yield gives PCCW a significant buffer versus the
sector average of a 6.5% yield, although that may well be necessary in the
current market environment. PCCW itself is currently trading at a 2012 dividend
yield of about 5.3%, according to Bloomberg.
The IPO will include a 10% tranche earmarked for Hong Kong retail investors,
but the company will also offer 10% to existing PCCW shareholders in the form
of a preferential offering. That latter portion can be upsized to 30% depending
on the demand. However, PCCW shareholders have complained for years about the
company’s lagging share price, so it is somewhat difficult to see them being
interested in paying for the same assets that they have already bought once.
That in mind, PCCW will also distribute an additional 5% of HKT Trust’s share
capital (on top of the global offering) to its existing shareholders for free.
These bonus shares will not be handed out immediately, however, but will be
distributed in two portions – at the end of the first quarter following the
listing and then again 60 days later. While this is free, it is also designed
to limit the selling of PCCW shares in the lead up to and immediately following
the listing of HKT Trust.
-- 2011 September 28 FINANCE
Richard's happiest moments? - the Birth of
that he's sired three sons, the succession issue is out of the way for tycoon
Richard Li of Hong Kong.
Ethan Li, eldest son of Richard Li
Ming Pao Daily News received today a
statement, signed by Isabella Leong and sent via fax, confirmed she has broken
up with Richard Li, and that they will share a joint-custody for their three
The Statement began by wishing all media
friends a good year ahead, added she (Leong) has also entered into a new
phrase in 2011 - she has ended the relationship with Richard Li.
She pointed out that they shared a memorable time together, and will raise
the children jointly; as their health and happiness is the couple's shared
vision. Leong wishes the statement will put an end to endless guess and
Nolasco da Silva)是香港藝人，出生於澳門，是葡中混血兒。
Isabella, born Luisa Isabella Nolasco da
Silva is a Hong Kong artistes, born in Macau of Portugese and Chinese parents,
had given birth to Ethan, Richard Li's heir and first child two years ago,
followed by a pair of twin boys last June.即時新聞)
2011 February 26 MING PAO
Isabella delivered Twin Boys for Richard Li
Born in the United States
Apple Daily reported on July 7, 2010
that Isabella Leong has reportedly given birth to a pair of twin boys at a
San Francisco hospital late June for Richard Li. It is
understood that Richard was with her during the delivery and the pair were
said to have tears in eyes when witnessing the arrival of the twins, who
will be their second and third children after ethan who was born last April.
The news is said to be confirmed by Richard in person, upon his return to
It is not known whether they will be issuing any photos of the twins, like
what they did for Ethan, their first born.
Both are not available for comment.
The July 17th edition of Apple
Daily reported that Isabella Leong, the mother of Richard Li's three boys
has no intentions at this stage to be Mrs.
現 年 27歲的徐子淇年前嫁入豪門成為千億新抱後，
denies marrying Richard Li. There's been talks of the wedding bells
following the 22-year-old's second attempt at motherhood of which a pair of
twin boys were born late June in San Francisco. Little birds in the high
society has it that Superman Li Ka-shing is over the moon about the arrival
of Richard's second and third heirs and has since agreed to let Isabella in,
as a Li family member. It was reported that Richard Li was to go to visit the
mother and babies himself but was tired down by work.
In a rare attempt to break the silence, Isabella, speaking via her
spokesperson, Michelle Lo, denies any plan of marriage and says she is happy
as she is and has no plan of being Mrs. Li at this point in life.
- 2010 July 17 APPLE DAILY
Hong Kong's Pacific Century Group hails
Hong Kong tycoon Richard Li's Pacific
Century Group said Monday it was "very pleased" after sealing a
500 million dollar deal to buy part of US insurance giant AIG.
PCG will pay an initial 300 million dollars in cash for AIG
Investments, part of American International Group's investment advisory and
asset management business, the US firm said in a statement Saturday.
are very pleased to sign this agreement with AIG, although of course with a
number of months until closing we will save our celebrations until
completion," a PCG spokesman said Monday. "
AIGI have a strong
management team, running a substantial portfolio of assets. The company
suits our investment philosophy of making long term investments in quality
The units being sold to PCG operate in 32 countries and
manage approximately 88.7 billion dollars in investments belonging to
institutional and retail clients, AIG said.
AIG was the largest single
recipient of US bailouts, with the government pumping more than 170 billion
dollars into the firm in late 2008 to keep it afloat and taking a
controlling stake in the group in the process. The company was on the verge
of collapse last year after backing trillions of dollars in risky financial
products amid a home mortgage meltdown that triggered financial turmoil. It
has been selling off various units as it seeks to steady its financial
The buyout marks a bold foray into asset management for Li,
chairman of Hong Kong's biggest telecommunications firm, PCCW, and the son
of Li Ka-shing, one of the wealthiest men in Asia.
- 2009 September 7 AFP
This photo from Apple Daily last week says it all!
Richard Li shows off heir Ethan Li with mother Isabella Leong in Toronto
exclusively confirmed to us (Apple Daily), Riichard Li and Isabella
Leong issued a photo of their new born baby boy, named Ethan in
English and Li Cheung-Chi by his grand father Superman Li.
It is known that the baby boy was born in April in Toronto where Richard Li
is presently accompanying Isabella for her post-natal recovery. When
asked any plan of a marriage it is said that both (Li and Leong) are
immensely enjoying their role as parents and have no plan for further
expansion of the 'family'... - 2009 June
Tao Daily News:
Richard Li confirmed to the paper today that
he will arrange to have Isabella and Ethan return to meet his Father, aka
Superman Li, in late July. - 2009 June 11
Baby Ethan at 10 pounds on May 26th
Bonny boy makes for a double dividend
Now we know why PCCW chairman Richard Li Tzar-kai was so generous in
handing out a special dividend to shareholders in April. He was probably
celebrating the fact that he was about to become a father.
Apple Daily's exclusive picture of the latest addition to the Li
clan with his proud mum and dad was the talk of the dim sum tables all over
Baby Ethan was born in Canada on April 26, four days after Mr Li's
HK$15.93 billion bid to privatise PCCW was blocked by the Court of Appeal,
prompting the company to announce on April 23 the special dividend of
HK$1.30 per share.
The gossip columns are sure to be full of speculation about what the
future holds for Ethan and his mother, 21-year-old former Emperor
Entertainment Group singer-actress Isabella Leong Lok-sze.
But one thing is certain, the new arrival has the blessing of grandfather
Li Ka-shing, who gave the baby his Chinese name of Cheung-chi, which
translates as "long-term good governance".
It was Richard Li who chose the English name Ethan. We wonder if it had
anything to do with his liking for Ethan Hunt, the name of the leading
character in the Mission Impossible movies.
Baby proves big news
It was said that even Li Ka-shing was shocked to hear that the report of
his new grandson had appeared in the Apple Daily yesterday.
Knowing how popular the exclusive would be, the newspaper ramped its
print run up to 400,000 copies, compared with the usual 300,000. The report
was not on the front page of the paper - that belonged to the June 4
candlelight vigil at Victoria Park - but the publisher arranged with
distributors for the section in which it appeared to be the one that was
displayed on newsstands.
It is understood that the team who worked on the report shared a HK$2,000
cash bonus, compared with the usual HK$300 daily prize. The team that put
together the June 4 package this week shared a bonus of HK$10,000.
- 2009 June 5 SOUTH CHINA MORNING POST
Richard and Isabella bought in the
prestigious Forest Hills district of Toronto where he has always dreamed to
Ming Pao Weekly is
published Sunday June 7 and is the only publication that scoops the
interview with Leong and Li in great length.
reads Richard Li arranges Isabella and son to stay in Singapore
"When asked of how he felt (about
having another grandson), "Superman" Li Ka-shing (nakename fondly
used by Hong Kong media) said "of course I am immensely happy". It
is known that Ethan Li will become the fourth heir to inherit senior Li's
100 Bn HKD empire, after Victor, his uncle, Richard, his father and Michael,
his first cousin and uncle Victor's only son.
Appeared on Ming Pao Weekly's cover, Isabella Leong is quoted saying,
"we (Richard and I) have never been so content in our lives. Ethan is a
happy baby. He just cannot stop smiling, and such good nature of his is
infecting everyone that's around him." Isabella, aged 20, having named
the best actress in Portugal film festival in 2008, is one of the most
promising stars in Hong Kong. With her renowned performance in Hollywood
mega-production "Mummy 3", she is immediately attracted lots of
attention from movie producers and publicists worldwide, including a movie
production by award-winning Chinese director Zhang Yimou. However, the young
mother expressed no wish to return to the glittering life on the silver
screen, instead she told the weekly reporter that she prefers to devote
herself to nurture baby Ethan, "so that he will grow up to be a useful
person that lives up to the expectation of his father and
grand-father." Indeed, Ethan's Chinese name "Cheung-chi"is
chosen specially for him by his beloved grand-father aka
It is understood that "Cheung-chi" has a profound meaning from
Ancient Chinese literature, bearing the hope of Long and Peaceful Reign (of
a country, or a nation, institution, company etc). Local observers note that
"Cheung" echoes "Cheung Kong", Li's flagship in Hong
Kong which is listed as 0001, the very first in the local stock market.
Isabella is of Portuguese descendants. Her late father came from a very
wealthy family that had linkage to the royalty in Portugal back centuries
ago. Isabella immigrated to Hong Kong at aged 12, followed her Hong
Kong-born mother and elder sister. -
2009 June 8 APPLE
In hiding for 10 months, Isabella and Richard Li are "making
[more] babies" in Tokyo
Isabella holding her HK passport.
Dressed so plain and low-key, Isabella was seen in Tokyo Airport at around 2
pm on Sunday November 14th. She was sent to the airport by a driver, neat and
clean and not bejeweled, except a pair of pearl earrings.
Isabella seen talking non-stop with ground
hostesses, very friendly.
更 當眾除低黑色 Gucci
Isabella is taking the 5:10 pm flight to Toronto. She was constantly
playing w her iphone - one wonders if she's reporting what happened to Richard?
She had to take off her Gucci boots when going thru customs.
Isabella， 5呎 6吋半高着上
Below is the her conversation with the reporter:
F：《 FACE》 梁：梁洛施
F(Face Magazine): Isabella, stand still for a pix?
梁：唔影喇！I: no la!
F: Had fun w Richard for a week, where now you are heading to?
... (keep smiling)
How're the twins? What're their names?
Good! Me go la, bye bye!
飛勻三國 Covering three countries
Isabella working out in Toronto, Canada
Tokyo where Richard and Isabella spent time together recently
'10 1月 casual look
Sammi Cheng Sau-man the local cantopop singer
NEXT MEDIA magazine 2010
The Shek-O home and the Toronto real estate developments were acquired by Andrea
Eng, on behalf of Richard Li.
- 2010 November
11 ORIENTAL DAILY
PCCW was always destined to grow. Run
by Richard Li, second son to property tycoon Li Ka-shing, it had the
financial and operational backing locked in from the outset.
At the time, the $12 billion loan was a record transaction in the Asia
syndicated loan markets -- more than double the size of the previous
record holder in fact -- and in our awards write-up we said it
"opened the door for leveraged financing across the broader spectrum
of the region's capital markets".
The leads decided to structure a deal as a leveraged financing secured
against the assets of the target company and a non-recourse structure
through a special purpose vehicle owning the HKT shares was used. The
debt-to-Ebitda ratio was nine times, versus typically no more than 5.5
times for European deals at the time.
Aside from kick-starting the loan
market into booking bigger and better deals, the loan also paid almost $90
million in fees, which got divvied up between the four lead arrangers
(Bank of China, Barclays, BNP and HSBC). The deal was not so
profitable for the second tier of 18 banks that were left with an average
return of about $2.5 million each because of over-subscription. In
absolute terms this was still a fairly sound pay-out, but considering
initial indications of returns of up to $10 million each, some of the
banks may have come off feeling slightly short-changed for their
Overall although he suffered a personal toll
during the exuberance of the dotcom era although his wealth and empire
Cyberworks - there were a few skeptics
His STAR-TV business start-up is a case study at
Harvard Business School.
Messiah of Cyberasia
of the world's largest Internet companies has suddenly emerged in, of all
places, Hong Kong
odd thing happened last month, just before Christmas. A Hong Kong firm, only
eight months old, run by the 33-year-old son of an old-style property tycoon
and with a business plan that almost nobody fully understands, suddenly
became one of the biggest Internet companies in the world, with a
stockmarket value of $21 billion. Odder yet: it might even deserve it.
firm is Pacific Century CyberWorks (PCCW),
a name still little known outside Hong Kong. That will soon change, thanks
to the vaulting ambitions of its founder, Richard Li, and the billions of
dollars he can marshal behind them. PCCW
is assembling a satellite-based broadband Internet network, modelled on
America's Excite@Home, with the aim of becoming the largest broadband
Internet business in the world. It has also built a venture-capital arm,
CyberWorks Ventures, that has already invested $500m in cash and equity in
nearly 30 companies. They include big stakes in SoftNet, a broadband
data-provider passing 2.4m cable subscribers in America, and CMGI,
an American-based venture-fund with a similar investment strategy. PCCW's venture-capital investments alone are now worth nearly $2
a rate of nearly a deal a week, PCCW
is putting together the pieces of what could soon be one of the world's
biggest Internet conglomerates. It is building the pipes's from satellite
capacity and transmission to deals with the cable-television network
operators that will reach individual subscribers-to bring broadband data to
millions of households in Asia. It is buying stakes in dozens of companies
that will fill these pipes with content and services, from portals such as
Sina.com to Internet telephony, gaming and e-commerce. And it is starting
joint ventures with heavyweights such as Hikari Tsushin, a leader in Japan's
booming mobile-phone industry, that may extend its reach to mobile
multimedia as well.
PCCW has become Asia's Internet darling. Bankers are
falling over themselves to praise it (although it suffered badly in the
stockmarket correction that pounded Hong Kong this week). The firm's deals
in the past month, says Credit Suisse First Boston, have made it “the
Asian e-infrastructure play”. Credit Lyonnais calls it an “all-in-one of
Excite@Home, Yahoo! and CMGI
in Asia”. Lehman Brothers proclaimed that “an Internet star is born”.
Not bad for a firm that, Credit Suisse notes, was a small telecoms-equipment
distributor a few months ago.
PCCW really so magical? No firm could be. It is not really
eight months old--it just looks that way because Mr Li bought a small local
firm called Tricom Holdings last May and used it to list the Internet
ventures of his existing property conglomerate, the Pacific Century Group,
which until then was best-known for winning a sweetheart deal from Hong
Kong's government to build an industrial park. Cyber-Port, as it is called,
has moved to the periphery of the firm's operations's where it belongs. The
Internet ventures had been in the works for more than two years; indeed, the
first sign that something was up was when Intel paid $50m for a minority
share in Mr Li' sInternet project in early 1998.
is Mr Li a newcomer to either satellites or technology: he started Pacific
Century in 1993 with the billion dollars he got for selling Star TV, his first media venture and today the leading satellite broadcaster in
the region. He has a degree from Stanford in computer engineering. And there
is the small matter of his father, Li Ka-Shing, Hong Kong's richest tycoon
and a force in telecoms thanks to his ownership of Hutchinson Whampoa, which
last year made a fortune selling its stake in the Orange mobile network in
Britain to Germany's Mannesmann. The elder Mr Li has virtually no part in PCCW: yet few names carry more weight in Asia. When he started in business
the younger Mr Li's arrogance made him plenty of enemies, but he has since
grown up, discovering his inner geek along with a softer style.
younger Mr Li was already a wealthy man when he started: last year Forbes
ranked the Li family tenth-richest in the world, with about $13 billion. The
elder Mr Li's canny trading last year probably added $5 billion or so to
that. But in the space of only a few months, Mr Li junior has nearly
equalled his father. Sohaib Umar, an analyst with Credit Lyonnais Asia,
calculates that the junior Mr Li owns 54.5% of PCCW,
a stake that is now worth nearly $9 billion. Add his property and other
investments and the total may exceed $12 billion, not counting his share of
the family wealth.
any case, it is easy to make too much of the family connection. PCCW is not an outpost of the elder Mr Li's empire, nor is it the dalliance
of an indulged son (the elder Mr Li's sole financial contribution was to
invest $62m to help set up Star TV
in the early 1990s). But the younger Mr Li did inherit one trait that has
served him well: a knack for deal-making perfectly tuned to the frantic pace
of the Internet. Aides describe him negotiating billion-dollar deals in a
few hours, sealing clauses with rapid fire (“Done!”) on a mixture of
instinct, experience and some of the best connections in the technology
the chairman as chief negotiator has allowed PCCW
to react to openings as nimbly as any startup: in the dot.com industry these
days, the ability to invest and strike alliances quickly counts for more
than soldiering on behind a solid business plan. That might make PCCW
sound like Japan's Softbank, but it is not. Unlike the phenomenal Internet
investor, PCCW aims to build a real business, not just a portfolio.
new star dawns
in PCCW's core broadband-access business, doubts remain. On
the face of it, there is something counterintuitive about PCCW's dream. It wants to bring broadband Internet access to all of Asia
(mainly China, India and Japan) via televisions and interactive set-top
boxes. This is natural enough for Mr Li: take his old Star TV
plan, replace "television"with "broadband Internet" and
you would not be far off. But Star is thought to have lost more than $600m
in less than a decade and is still losing money. Asian viewers, like
European ones, turn out to have a taste for expensive local programming.
Most also refuse to pay for content. They are, needless to say,
poor--indeed, Mr Li's target audience is one of the least affluent in the
contrast Excite@Home's consumers are rich. Yet the American company has
fought to find customers for its own broadband offerings. After four years,
it has only about 1m subscribers and its business is only now taking off.
Can Mr Li really thrive in India and China when Excite@Home has struggled in
Silicon Valley and New York?
Mr Li thinks that it can--and he might be right. Excite@Home suffered
because American cable operators had neither the money nor the urgency to
upgrade their own systems to carry two-way data. But broadband is taking off
now because AT&T's huge investment in cable firms has kick-started the market-and led to
price competition with telecoms firms that offer broadband services over
Asia, Mr Li argues, the cable operators have even more reason to invest:
many of the households he wants to supply have no telephone at all. Asian
cable infrastructure, especially in China, is newer and easier to convert to
two-way data than America's and where it is not in good condition (such as
in India), it is cheaper to replace, thanks to lower labour costs. Overall, PCCW hopes to reach more than 16m households by 2005, out of an Asian cable
market of more than 160m by then. These will be mostly rich, urban Asians.
There are an awful lot of these, even in otherwise poor
a few months, PCCW will
be able to prove its point. It plans to launch its service, initially as
satellite-television channels with Web content, by mid-year. One test will
be whether PCCW can bring together enough compelling content to create a service people
will pay for-something neither Cable & Wireless HKT
or Singapore Telecom has managed with their own broadband services in those
cities. Their potential audiences, of just a few million, are too small to
justify the dozens of expensive channels of local content required to
Li's audiences will at first be even smaller and spread over even more
disparate cultures. Hence the venture fund, whose investments are intended
to supply the content that PCCW cannot. Sometimes being a billionaire really does have
its advantages. -
8 January 2000 Economist
In the end, Richard Li and his
Pacific Century Group shall prevail cause "Size
Does Matter" as Business Week points out and the influence
and economic engine of the Li family world-wide shall endure the ups and
downs of global economic trends.
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