Transcript Broadband In China

Broadband In China
ADSL, LAN, Cable Modem,
Wireless LAN and Satellite
Broadband
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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
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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
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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