PSINet Inc. (Nasdaq: PSIX) moved up 2 1/2 to 89 1/4 Wednesday after announcing that Hong Kong's Telecommunications Authority awarded it subsidiary licenses to build wireless facilities and a submarine cable, and connect its global network to a satellite system from Hong Kong to PSINet's global network.
PSINet said it will use the wireless network license to provide its own broadband access to 87 percent of the business market and 75 percent of the high-usage residential market in Hong Kong.
It also said it plans to cover the major Hong Kong business districts, including the Kowloon peninsula from Tsuen Wan to Kwun Tong, and from Chai Wan to Central on Hong Kong Island, which contain about 195,000 potential business customers and about 1 million potential residential customers.
About 29 percent of Hong Kong's 6.8 million residents make it one of the largest Web-use areas in the Asia Pacific region, according to a 1999 survey by market research firm ACNielson.
PSINet said the liberalization of Hong Kong's telecoms market, coupled with the company's wireless license, enables it to provide broadband Internet services directly to businesses and individuals without using Hong Kong Telecom facilities.
"The wireless licenses create high quality competition for alternative local loop broadband services in Hong Kong, improving Internet services and reducing prices for businesses and consumers," said CEO William Schrader in a prepared release.
Last month, PSINet announced that its fourth-quarter revenue would jump to more than $185 million. It also set a 2-for-1 stock split.
First Call consensus expects it to lose $1.86 a share in the quarter.
PSINet shares hit a 52-week high of 107 3/16 in January after falling to a low of 30 3/8 in October.
Twelve of the 13 analysts following the stock maintain either a "buy" or "strong buy" recommendation.
Reuters contributed to this report.