【正文】 BCG analysis 27 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI CUSTOMER NEEDS EXIST THRUGHOUT THE VALUE CHAIN CT’s Offering Yields Significant Gaps Learn Buy Get Use/support Pay Customer value chain Needs identified ? How data services can help their business ? Assistance deploying solutions ? Quicker and more convenient application channels ? Rapid and reliable provisioning ? Faster, reliable repair services ? Prompt, customized billing ? Lack customer focus ? Solutions virtually nonexistent ? Mostly oneway product marketing ? No customer input for provisioning ? CT determines queue without specific timing ? No penalties for missed appointments ? Negligent repair service ? Slow fulfillment amp。 industry interviews。 consider supplying fixedline incumbents Cover POPs in all major calling zones。 develop local leased lines work in key locations Aggressive deployment of backbone infrastructure to provide unparalleled bandwidth Establish high bandwidth international gateway to differentiate inter access Superior service with clear positioning ? “The clear alternative to CT” ISP Long distance voice Capture early revenue from to fund development of subsequent business models Top 60 POPs by end of year 20xx utilizing mix of leased lines from CT and CNC work Position off voice as first product from “China’s first data carrier” Do not overextend resources in VOIP as it does not fit CNC’s long term strategy Create “dialaround” solutions for business and interconnect terms 17930 6 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI Enterprise solutions POTENTIAL BUSINESS MODELS COVER WIDE RANGE OF PRODUCT/MARKET ALTERNATIVES Opportunity for growth Current market size Wholesale/ carrier Consumer ISP? Domestic and International Long Distance Voice Residential Med/large enterprise customers Carriers Potential traffic per consumer Products Emerging data Data Voice Emerging data niche 7 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI AGENDA Business Models ? Domestic and international longdistance voice ? Wholesale/carrier ? Enterprise solutions ? Issues going forward 8 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI APPROACH TO DOMESTIC AND INTERNATIONAL VOICE BUSINESS MODEL Objectives Hypothesized Approach Capture early revenue from launch of prepaid IP calling cards ? “Cash cow” for funding other business model development Pursue prefix and equal access long distance for business customers as soon as possible to begin establishing relationships Manage pricing and product life cycle effectively to maximize total margin and avoid investing in declining products Do not overextend ourselves nor blur our “data” image Fight the regulatory battle to ensure favorable approaches to equal access and interconnect Market calling cards to business customers in the short term for travelling personnel Emphasize quality image/brand to distinguish from CT and Uniposition calling card as first step in being a next generation full services provider Establish mechanisms to link marketing expenditures with revenue and margin growth by product to ensure effective investment Emphasize low cost targeted marketing and loyalty programs ? Do not overextend ? Always emphasize advanced technology and evolution to full services provision 9 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI DOMESTIC AND INTERNATIONAL VOICE SUMMARY Preliminary Economics Phase I CapEx (20xx,20xx): ~ B RMB ? Fiber/construction: ~ B RMB ? IP/DWDM equipment: ~720 M RMB ? POP/VOIP: ~530 M RMB ? OSS/Network management system: ~100 M RMB OpEx expected to be ~30% of revenue by 20xx Market share and revenue estimates 20xx ? Off DLD: 30% ? Off ILD: 30% ~ $2 B RMB ? IP Intl. termination: 27% 5 year NPV: Essentially breakeven considering off voice alone1 Key Issues to be Addressed Interconnect agreements with local PTA’s。 BCG analysis 14 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI AGENDA Business Models ? Domestic and international longdistance voice ? Wholesale/carrier ? Enterprise solutions ? Issues going forward 15 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI APPROACH TO WHOLESALE/CARRIER BUSINESS MODEL Objectives Hypothesized Approach Develop wholesale business as traffic generator to improve economics of backbone through higher utilization Bee the wholesale carrier of choice with technologically superior service offerings including high bandwidth international gateway connectivity Consider wholesaling access to CT, Uni, and Jitong depending on petitive implications Superior customer service with clear positioning ? “The clear alternative to CT” Aggressive deployment of backbone infrastructure ? Connecting top 15 cities by end of 20xx and expanding to top 50 cities by 20xx Seek partnerships to establish high bandwidth international gateway connectivityabsolutely essential for differentiating CNC offering Develop interconnection capabilities in all major POPs and mobile basestations in key geographical location