【導(dǎo)讀】-1-. CONTENT. Regulatoryoverview. Marketoverview. Businessmodels. Nextsteps. -2-. AGENDA. BusinessModels. Wholesale/carrier. Issuesgoingforward. -3-. Roadmapforpursuing. businessmodelsand. expectedfinancial. performance. CNCbusinessplan. Major. issues. Expected. output. linerevenueforCNC?fiberworks?bybusinessmodeland. selectedscenarios. Assessmentof. market. opportunities. HowwillChina. datamarket. develop?Howlargeisthe. overallopportunity. foranewentrant?andrevenueforecast. byproductarea. Regulatoryand. petitive. analysis. inChina?Willequalaccessfor. voiceanddatabe. grantedandwhen?WhateffectwillWTO. have?Regulatorymapping. andCNCshare. predictionsacross. scenarios. -4-. upsidepotential. resourcesinvolved. serviceandcoverage. shouldbeginASAP. tofocus. -5-. Overall. approach. Where. How

　　

【正文】 gxSHI … BUT COMPRISES TREMENDOUS UPSIDE POTENTIAL 0204060801001201401601802001998 20xx 20xxInter Access Leased Lines ILD DLD Local 0510152025303520xx 20xxOther Portal Broadband Content Web Hosting/ Collocation Existing Services Emerging Services 9804 CAGR 124% 40% 10% 7% 11% IP VPN Broadband Network Applications 71% 83% 186% 98% 111% 286% 0004 CAGR Market size (RMB BN) Market size (RMB BN) 78 96 187 Overall 16% Overall 86% 3 32 Source: CNC team inputs。 foreign benchmarks。 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。 technical support response ? Poor response to customers ? Limited bill customization CT approach Significant opportunity for CNC establish position in customer solutions, ease of use, and responsive service Areas highlighted most in customer interviews Source: Customer interviews。 BCG analysis 28 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI STAGED PRODUCT INTRODUCTION NECESSARY TO MANAGE QUALITY Hypothesized Product Introductions Voice Data 20xx 20xx 20xx 20xx 20xx 20xx Phase I amp。 II Phase III Phase IV Leased Lines ? Mobile carriers ? Eerprise High bandwidth dedicated inter access for businesses and ISPs Access Ports VPN ? Basic enterprise Broadband applications ? Platforms to enable VOD, etc... Web Hosting Dark Fiber Residential ISP? Advanced VPN ? Extra ? Voice, video QoS guarantees ? Industry specific offerings Other emerging services (. eCommerce) IPphone voice ? Prefix ? “Dialaround” solutions Equal access voice? On voice? Focus on quality over quantity Market as integrated products Stress CNC role as integrated data player Positioning Issues 29 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI CNC SHOULD USE CREATIVE WAYS TO GROW THE MARKET, AVOID HEAD TO HEAD COMPETITION Competitors all focus on the same demand from the same customers Savagely pete on price Reactively wait for customers to identify need, request products Pursue growing customers data intensive enterprises ? Fresh opportunities for sales, instead of peting over existing business ? Approach proactively with new products, instead of waiting for customers to initiate sales process Creatively identify new markets ? . market for panies requiring very rapid provisioning or customized products ? Bee the only choice for these panies Lobby the government to support more emerce and information industries growth CT CNC Uni Jitong CT is likely to be unable to meet growing demand alone Traditional, narrow view New approaches to growing sales 30 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI TOTAL GDP VS. GDP/CAPITA IS A PRELIMINARY INDICATOR FOR ATTRACTIVE LOCAL ACCESS MARKETS Example: 15 Initial Cities with POPs on CNC Network 1 , 0 0 0 , 0 0 06 , 0 0 0 , 0 0 01 1 , 0 0 0 , 0 0 01 6 , 0 0 0 , 0 0 02 1 , 0 0 0 , 0 0 02 6 , 0 0 0 , 0 0 03 1 , 0 0 0 , 0 0 03 6 , 0 0 0 , 0 0 00 20 40 60 80 100 120Shanghai Beijing Guangzhou Tianjin Hangzhou Wuhan Nanjing Jinan Shijiazhuang Zhenzhou Changsha Xuzhou Xiamen Fuzhou Shenzhen Examples of additional cities not in initial 15 designated for CNC POPs Hypothetical breakeven curve for building local access Suzhou Wuxi Total GDP (k RMB) GDP/cap (k RMB) 31 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI VERY DENSE MARKETS SUCH AS SHANGHAI BEST SERVED BY METRO FIBER RINGS M POP/rail station Hong Qiao Development Area People’s park Huai Hai Road Xujiahui Pudong Financial Zone Fiber length: Along subway: Along elevated ring road: Along road: 17000m 9000m 8000m of major business buildings accessed: ~200 Fibers along Subway in construction Subway Elevated ring road Road (dig required) Dense Business Area served Metro stations M M M 32 China Net The Boston Consulting Group ConfidentialDestroy by Shredding 4503405Interim14Dec99TZDgxSHI SHANGHAI ECONOMICS VERY ATTRACTIVE DUE TO HIGH BUILDING AND BUSINESS DENSITY 2 4 8705133 1 0 6789 5 4 1 4 2 4 6 1 445 3 1 6 0 0 5 0 0 4 0 0 3 0 0 2 0 0 1 0 0010020030040050060070080090010005 year PV(1) (M RMB) CapEX OpEx Revenue 5 year NPV@15%: ~310M RMB 5 year IRR: ~70% Shanghai presents most attractive enterprise solutions market SG amp。 A Allocated backbone IDD Emerging data(3) DLD Data services SONET/switching equipment OSS Allocated backbone(2) (1) Assuming 15% cost of capital (2) Cost of providing F/R and ATM service on backbone allocated over first 4