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China
Telecom selects FLAG Telecom to provide international
capacity between China and US West Coast
Largest capacity purchase ever placed
by China Telecom (CT) provides a platform to deliver
advanced services and further demonstrates confidence
in FLAG Telecom’s strength in the region.
Hong Kong and London, 25 August, 2004– In
one of the largest cash deals this year, China Telecom,
one of the leading operators in China, has awarded
FLAG Telecom, a leading provider of international
wholesale network transport and communications services,
a multi-million dollar contract for multiple STM-16s
providing a substantial 30Gbits/s capacity between
China and the United States. The STM-16s will provide
full-circuit, high quality connectivity to carry
large volumes of voice, data and Internet traffic
between China and the US West Coast. In meeting
China Telecom’s requirements FLAG Telecom
is providing an integrated solution based on its
FLAG North Asia Loop (FNAL) system and Tyco Telecommunications’
TGN Trans-Pacific cable.
This contract is expected to satisfy mid- to long-term
forecast demand and positions FLAG Telecom as a
major supplier to China Telecom. The demand for
connectivity is being driven primarily by the continuing
rapid growth of IP traffic and bandwidth-hungry
Internet applications. The number of internet subscribers
reached 11 million by the end of June 2004, growing
by 50% over the figure at the end of 2003. The user
base is expected to expand at 100% in the year of
2004 and grow at an average of 50% annually in the
next three years.
Mr Chang Xiao Bing, the Chief Operating Officer
of China Telecom, said: “At present, the driving
forces for growth are Internet and Broadband. This
agreement with FLAG enables us to meet the burgeoning
demands of our customers and ensures we meet the
anticipated growth in new broadband services. China
Telecom selected the bid by FLAG as it offered an
extremely high quality, scaleable solution at a
cost-effective price. Our connectivity will be carried
entirely on the latest generation of terabits/s
loop cable systems, providing additional resilience.
Our two organisations have enjoyed a long-standing
relationship dating back to 1997 when China Telecom
provided the landing station at Shanghai for the
world’s first private international cable
– the FLAG Europe-Asia system. FLAG is one
of our major long-term suppliers and we look forward
to continuing our close working relationship with
them.”
Patrick Gallagher, CEO, FLAG Telecom, said: “China
Telecom has now put in place a fast, reliable and
scaleable international platform to deliver advanced
services and meet forecast demand for high-speed
connectivity. This is much more than a supplier
agreement and demonstrates China Telecom’s
confidence in FLAG’s ability to meet their
exacting quality requirements; in our experience
in the marketplace and our assured future with the
support of our parent, Reliance. Together with Reliance
and our partner suppliers we are able to provide
a global one-stop shop both for bandwidth and innovative
products and services – all at extremely cost-effective
pricing for customers.”
Owen Best, President Asia Pacific, FLAG Telecom,
commented: “Broadband subscribers in China
grew by more than 14 per cent to 2.85 million in
the first quarter of this year. However, although
China today has the largest number of broadband
users in Asia, we have yet to see the market penetration
rates achieved in Korea and Japan. Over the next
couple of years, as the broadband demand starts
to bite with the continued roll-out of fibre to
the home (FTTH), we anticipate an enormous impact
on the market.”
About
FLAG Telecom
FLAG Telecom, a member company of the Reliance Group,
has an established customer base of more than 180
leading operators, including all of the top ten
international carriers. FLAG owns and manages an
extensive optical fibre network spanning four continents
and connecting key business markets in Asia, Europe,
the Middle East and the USA. FLAG also owns and
operates a low latency global MPLS based IP network,
which connects most of the world's principal international
Internet exchanges. FLAG offers a focused range
of global products, including global bandwidth,
IP, Internet, Ethernet and Co-location services.
In the first international acquisition by the Group,
FLAG Telecom became a Reliance Group company on
12 January 2004. Recent news releases and further
information are on FLAG Telecom's website at: www.flagtelecom.com.
About Reliance Infocomm
Reliance Infocomm Ltd., India’s largest mobile
service provider, is a part of the Reliance Group
founded by Shri Dhirubhai H. Ambani (1932-2002).
Reliance Infocomm has established a pan-India, high-capacity,
integrated (wireless and wireline) and convergent
(voice, data and video) digital network, to offer
services spanning the entire Infocomm value chain
– infrastructure, services for enterprises
and individuals, applications and consulting. The
Reliance Group is India's largest business house
with total revenues in the financial year ended
March 2003 of Rs 800 billion (US$16.8 billion),
cash profit of over Rs 98 billion (US$2.1 billion),
net profit of over Rs 47 billion (US$990 million),
market capitalisation Rs 974 billion (US$21.7 billion)
and exports of Rs 119 billion (US$2.5 billion).
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