Monday, April 4, 2011

How underserved markets in China and Peru are effectively positioned for ChinaTel’s wireless broadband technologies

SAN DIEGO, USA: Frost & Sullivan, a leading research and growth strategies firm, issued one of its latest white papers entitled “The Emergence of a New Wireless Broadband Provider”. In the authorized report, Frost & Sullivan delivers detailed insights about ChinaTel’s business initiatives in China and Peru, while also showcasing seven core components that support the company’s ability to deliver on its promise of building wireless infrastructure in key markets worldwide. The report also highlights leading data and statistics about China and Peru that strongly favor ChinaTel’s market positioning.

According to the report, China is one of the fastest growing economies in the world, but still has broadband penetration that’s ranked below many other countries. In addition, the report states that the per-capita disposable income of the urban Chinese population actually increased by 8.8 percent in 2009 as compared to the previous year. Moreover, the report shares that China has the largest mobile population (833 million users), meaning that access to information anytime, anywhere is becoming a key resource fueling the economy in China.

Most important to any service provider is access to underserved customers. The shear population of China and growth rate of the Chinese economy places ChinaTel in an enviable position – Frost & Sullivan

The white paper also highlights the rapid expansion that ChinaTel has experienced through assertive dealing-making with international broadband companies. Initially, the Company only owned the exclusive rights to roll out its Wireless Broadband Access (WBA) networks to the 29 largest cities in China through its partnership with CECT-Chinacomm. Now, the Company has quickly expanded its footprint to become the largest WBA network carrier in China by adding two additional major China-based network partnerships, including:

* Golden Bridge’s 9 city last mile WBA network; expandable to 100 cities+ within China (ChinaTel owns 49 percent).
* Sino Crossing 34,000 km fiber backbone throughout 90 percent of China (ChinaTel’s owns 51 percent).

As stated in the report, the Sino Crossing fiber asset, when upgraded, is capable of transporting in excess of 100 gigabytes of data per second each, which is the equivalent backbone of Tier 1 networks in the US being deployed by Verizon and Qwest. Furthermore, Frost & Sullivan highlights four important marketplace drivers that will increase the value of ChinaTel’s investment in the Sino Crossing fiber project including the fact that:

* Globally, mobile data traffic will double every year through 2014, increasing 39 times between 2009 and 2014.
* The transport of VoIP traffic by traditional Tier 1 carriers will become more important and will drive international telcos to look for additional networking partners in China.
* China still has strong social media growth potential since the country has not yet fully opened its networks and embraced social media the way the West has.
* The Sino Crossing fiber asset provides stability to ChinaTel by opening additional revenue streams through last-mile wireless solutions that ChinaTel will be deploying.

ChinaTel has also gained spectrum in Peru, via its subsidiary Perusat, to launch WBA networks in seven targeted cities within the country. Frost & Sullivan states that ChinaTel’s footprint in Peru demonstrates the Company’s ability to extend beyond the borders of China. Frost & Sullivan also shares some important Internet usage data on Peru, highlighting that the country’s Internet usage has risen from just 10 percent of the population in 2003 to 25 percent of the population at the end of 2008, according to statistics from the World Bank.

Finally, the white paper showcases seven core components that Frost & Sullivan believes are the cornerstones to ChinaTel’s ability to delivering an effective business model in the international wireless broadband arena, including the fact that:

1. WBA technologies are now well-known in the marketplace.
2. China and Latin America are still emerging markets, underserved by wireline and wireless service providers (leaving a door of opportunity for ChinaTel).
3. ChinaTel’s partnership with ZTE, which allows them to bring solid technology platforms to the market that can be easily upgradable to LTE, is a strong benefit.
4. ZTE is ChinaTel’s preferred service provider based on a solid MOU agreement in place.
5. By owning 51 percent stake in Sino Crossing, ChinaTel does not have to pay other service providers for backhaul.
6. By owning 49 percent of Golden Bridge, plus control of its board, ChinaTel can now expand its original licenses from the 29 up to 100+ cities in China.
7. ChinaTel’s investment in Peru, as well as other countries it is targeting, proves that it is on course for generating subscribers and revenues globally.

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