High-Capacity Networks Planned in China

HONG KONG (05/02/2000) - A group of Chinese companies led by HiNet Holdings Ltd. today will announce an agreement to build a fiber-optic network that by midyear will connect Guangzhou, one of southern China's most important industrial cities, with Beijing and Shanghai.

The announcement follows news yesterday that an Internet service provider based in inland Shaanxi province will build a broadband network, using a sophisticated traffic-control system provided by Cisco Systems Inc.

The HiNet-led fiber trunks will span 12,000 kilometers, from Beijing in the north to Guangzhou in the south, and from Guangzhou northeast to Shanghai. They initially will be equipped for 2.5G bits per second (bps) throughput and later can be expanded to 80G bps, according to B.D. Lau, chief operating officer of HiNet.

The HK$500 million (US$64 million) project is a joint venture among HiNet subsidiary Shine United Investment, Guangzhou South China Telecommunications Investment Ltd. (GZSC) and Chang Tong Communication Engineering Ltd. It will provide a backbone for data center services provided by HiNet subsidiary DigiNet Group Ltd., which plans to begin offering collocation and other Internet-related services this month at data centers in Hong Kong and the nearby Shenzhen Special Economic Zone. By midyear, DigiNet will open additional centers in Guangzhou and Shanghai, Lau said.

The group also will lease capacity on the fiber trunks to telecommunications and Internet service providers, Lau said. GZSC currently provides fiber capacity to China United Telecommunications Corp. in Guangzhou.

HiNet and its partners are tapping into a growing need for bandwidth in China, Lau said.

"China is a huge market, and not only because of the proliferation of Internet usage, but also (private) data communication," Lau said. "All this is creating a huge demand for bandwidth, and especially for linkage between cities and provinces."

The trunks will be connected to an existing GZSC network that extends throughout Guangdong Province, where Guangzhou is located, according to Lau.

Users in other cities passed by the trunk, including Wuhan, Xiamen, Fuzhou, and Hangzhou, will have access to the fiber through gateways, Lau said.

Yesterday, Cisco Systems Inc. announced that Internet service provider Shaanxi Telecom will build a multimedia network to carry services such as voice over IP (Internet Protocol), video on demand, and virtual private networks.

The network, built with approximately US$3.5 million worth of Cisco gear, will use Cisco's Multiprotocol Label Switching (MPLS) technology. MPLS is designed to speed up the routing of data packets through the core of a network. The network will include Cisco's 12008 Gigabit Switch Routers as well as access servers and enterprise-class switches and routers. Cisco SC2200 signalling controllers will provide support for the telecommunications Signalling System 7, according to a Cisco statement.

HiNet Holdings, in Hong Kong, can be reached at +852-2998-3888. Cisco, in San Jose, California, is at +1-408-526-4000, or via the Web at http://www.cisco.com/.

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