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Rumor: China Telecom Prepares for CDMA Network Operation

Economic Observer, 1/26/08

According to an informed source, China Telecom (NYSE: CHA; 0728.HK) has invited CDMA firms including Linkage, AsiaInfo (Nasdaq: ASIA), Longshine, Neusoft and Digital China Si-Tech to present proposals for linking fixed-line and CDMA networks. China Telecom is also working on procurement plans for CDMA network equipment and soliciting manufacturers' evaluations on those plans. As there is a three to five month lead time for equipment orders, China Telecom will enter negotiations on procurement with hardware manufacturers including IBM and Hewlett Packard after Chinese New Year and when the evaluations have been received.

China Telecom will receive network routers and switches as part of the transfer of China Unicom's CDMA network, so will not need to make new purchases of this kind of equipment. However, significant numbers of servers and storage may be procured.

Keywords: ASIA Longshine Neusoft Digital China Si-Tech wireless HP restructuring server 0728.HK AsiaInfo CDMA CHA China Telecom China Unicom Chinese New Year IBM SI storage telecom Linkage

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