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Broadband In China. ADSL, LAN, Cable Modem, Wireless LAN and Satellite Broadband. Telecom Market Overview. Existing Market: 400 million Telephones, 200 million Cellar phone, 58 million Internet users, 3 million broadband users and 20 million “Local Smart Phone” users. 2002 Highlight:
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Broadband In China ADSL, LAN, Cable Modem, Wireless LAN and Satellite Broadband .
Telecom Market Overview • Existing Market: 400 million Telephones, 200 million Cellar phone, 58 million Internet users, 3 million broadband users and 20 million “Local Smart Phone” users. • 2002 Highlight: • CDMA: 7 million users • “Local Smart phone” increased from 10 million to 20 millions and cover 300 cities in the past 2 years • SMS: 100 billion messages, revenue $1 billion US • LU: Invested $2 billion US in China • Nokia: $3 billion US revenue
Broadband Access • Broadband users increased from 1 million to 3 million in 2002. China Telecom 50%, CNC 20% and others 30% • Access methods: • ADSL: China telecom, CNC • LAN: CNC, China Broadcasting Net, Bluewave WWW and Great Wall Broadband. • Wireless: CNC and others • Cable modem: China Broadcasting Net • Satellite: China Satcom, Two-way Com, others
ADSL • ADSL is the biggest winner for broadband access in 2002. It should have good business future. • Reached 2 million users; estimated 6 million by 2003 end. • Successful business model: • Low cost to beat other competitors: installation fee $35, services fee (unlimited access) $20. • Expanded new services: VOD, games, education, tele-medicine, stock exchange and home communities. • Limited investment and relatively good returns • Employ existing phone line • Easy to install and service
LAN • Deployed metro LAN in cities since 2000 • China Cable Net, Great Wall Broadband, Blue Wave WWW and CNC. • Only a few success cases • China Cable in Zhan Jiang has 5000 to 10000 users and barely breakeven. China Cable + CNC success in two cities. • CNC provides service for about 2000 office buildings and small communities in cities. It combines network resources of China Cable Net to provide LAN in some cities. • Failed case • Blue Wave WWW bankruptcy after spend $10 million US in two years • Great Wall changed to become an ISP and set up Great Wall Broadband Dream
Cable Modem • Cable Modem trials in many cities since 1999, but fails to be deployed widely. • Shanghai, approximately 20 thousands, Beijing several thousands. • The Cable operators do not have ICP and ISP license. • Insufficient investments for system upgrade. • No successful business case. • Require backbone broadband access facilities linking operators such as the old @home etc. • May be too late for mass market deployment.
WLAN • WLAN is the hottest investment project in China since 2002. • Leaders: CNC, China Telecom, China Mobile • Frequency band: 2.4 GHz and 5.8 GHz • Market: Office buildings for enterprises and companies; schools; hotels and airport, small communities. • Success cases: • CNC WLAN covers about 2000 office buildings in 50 cities. • University campuses • The competitors: 3G, GPRS, data offerings from Local Smart Phone operations.
Satellite • DVB/IP and Direct PC are the two systems trying to provide broadband data for users. • The operators: CETV, Two-Way Satcom, China Satcom, CNC, China Telecom, and others. • Frequency band: Ku • System providers: Hughes, Norsat, Gilat, Comstream, Web Sat, Skystream • Main market: Education, stock information, • Success: CETV deployed about 15 thousands receiving systems • Potential problems • Not at business breakeven • Too many small operators • No killer applications
Conclusion • Broadband access increases rapidly in China • Many good business opportunities • Wireless LAN + Cable Net • Cable Net has the backbones in the cities • Low investment and easy to deploy • Progression from small implementations • Competitive in high density areas