China Netcom wishes to overtake China Telecom and become China's top broadband digital transmission services provider in 2003, President Tian Shuoning said on August 24.
Barely a year old, China Netcom is the smallest among the four licensed telecom operators in China.
Within this year it will apply for the license to provide mobile telecom services across the country. Other steps will follow so its dream of becoming top Chinese broadband digital transmission services provider may come true within three years.
Plans are ready for China Netcom to get on the stream in 17 Chinese cities high speed Internet and data transmission on October 28.
Its optical fibre backbone network spans 8,000 km, and boasts a transmission speed of 80 billion bits per second, which will be the fastest in the country, Tian said.
Its clients will be mostly multinationals and large-scale state-owned companies.
So far, China Telecom has been a near-monopoly Internet service provider in the country; but China Netcom will pose serious challenge to it, particularly in the more lucrative fronts of broadband transmission and managing networks for large-scale companies, when it launches its new services in October.
Tian is very upbeat in winning over large corporate clients, saying many including GE, Eastman Kodak, sina.com, the China Central Television and quite a few commercial banks are its targets.
Up to 90 percent of the infrastructure of the new systems are already in place and following a brief period of test run, business can get in full swing in late December.
Its optical fibres are laid underground through subway tunnels or suspended overhead along with urban power transmission lines, which saves a lot of installation costs.
Its clients will be able to enjoy up to 100 million bits per second of transmission speed at the end of the year, fast enough to support video transmission.
Digital transmission at lightening speed is only a part of the company's ambition. It also plans to build two super-large data centers, covering 50,000 square meters in land area, next May in Beijing's suburbs.
Once China joins the World Trade Organization, China Netcom will seek foreign investment or float shares on the stock market before the end of the following year, Tian said.
However, a draft rule disclosed in June this year said only telecom operators with annual revenues of more than 3 billion yuan have the right to partner with foreign investors.
Only China Telecom, China Mobile and China Unicom qualify if that conditon stay.
"It's only a draft rule and China Netcom will look for special permission," Tian said.
China Netcom is doing well in terms of cash flow. Capital spending by the current financial year ends in next March will amount to US$550 million, but that's well covered with the US$600 million of loans three state-owned commercial banks have pledged to make. The loans carry a five-year term and very low interests.
Tian attributed most revenues from the company to the fast-growing IP phone businesses, adding China Netcom can make profits within four years while excluding possible profits from mobile Internet services.
China Netcom was created by the China Academy of Social Sciences, State Administration of Radio, Film and Television, the Ministry of Railway and the Shanghai Municipal Government, with a 25 percent stake for each party.
(eastday.com)
