This document discusses cost efficient network strategies for telecom operators facing challenges from over-the-top services. It provides four case studies of China Telecom's strategies: 1) Network evolution to IP and new infrastructure to improve efficiency and reduce costs. 2) Establishing large cloud computing data centers with new technologies to lower power usage effectiveness. 3) Adopting new energy-saving technologies in telecom facilities. 4) Increased infrastructure co-construction and sharing to reduce capital expenditures and improve utilization. Building cost efficient networks through these approaches is becoming essential for telecom operators.

1. This document is offered compliments of
BSP Media Group. www.bspmediagroup.com
All rights reserved.

2. Cost Efficient Network Experience in
China Telecom
Nov, 2013
Customer-Oriented Culture Embedded in the Philosophy of
“The Highest Excellence is Like That of Water”

3. About CCS - I
 CCS is China’s biggest telecom infrastructure service company, with Over 50-year telecom service
experience.
 CCS’s foot print has covered 60+ countries/regions, providing professional service for 100+ operators.
 Revenue in 2012: 10 billion USD.
Strategic Partners &
Public Shareholders
51.4%
8.78%
China Communications
CCS Services Corporation
Limited
•
•
•
3.41%
36.41%
China’s biggest Telecom Infrastructure Services Company
Leading Business Process Outsourcing Company
A fast-growing Application and Content developer
Integrated
Solutions
TIS - Telecommunication
Infrastructure Services
Customers
Government
Organizations
BPO - Business
Process Outsourcing
Global Telecom Equipment
Vendors
Operators
ACO - Applications,
Content and Others
Enterprises
中国电信香港公司 2

4. About CCS - II

With our two overseas business units – CCSI and CITCC, we provide integrated solutions, onestop services and turn-key projects for Multinational Operators, Vendors and Corporations.
澳门
CT overseas platform
CCS overseas platform
CCS main business regions overseas
中国电信香港公司 4

5. Telecom Operators are facing challenges from OTT
1
85% data volume VS 39% revenue
85% of data volume is pure data, contributes only 39% revenue. (Chetan
Sharma,2012)
2
100Million USD
Telecom operators lose 100Million every day USD caused by skype. (Mobile
Squared, 2013)
“I knew it was over when I downloaded Skype.”
-----FCC Chairman Michael Powell recognized the challenges
from Skype and similar services.
3
18 times traffic VS 1.6 times revenue
Mobile internet traffic will increase 18 times in next 5
years since 2011. Meanwhile, the revenue will grow
1.6 times. (Cisco,2012)
AT&T: 80 times VS 1.5 times
Traffic and Revenue Increased Since 2011
20
18.8
15
10.5
10
5.83
5
1
0
2011
1.8
1.1
2012
3.24
1.21
2013
Revenue
1.33
1.46
1.61
2014
2015
2016
中国电信香港公司 4
Traffic

6. CCS’s Proposal: Strategy to Reduce Scissors Gap Between
Traffic and Revenue
Smart
Pipeline
Increasing
Revenue
 Data traffic control
New Public
Service
 Smart City Concept
New business  Cloud platform
mode
 Industry-specific applications
CAPEX
Reducing
 Simplify network structure
 Telecom infrastructure resources
sharing (Case 4)
OPEX
Reducing
 Network evolution (Case 1)
 Cloud computing (Case 2)
 New technology (Case 3)
Reducing
Cost
Energy-saving
emission reduction
中国电信香港公司 5

7. Content
Case Study:
Cost Efficient Network Experience of China Telecom
中国电信香港公司 6

8. Cost Efficient Network Case 1: Network Evolution
Spaghetti
Lasagne
Network is flattening
Open Service Platform
TDM
IP
IP
TDM
IP
All IP Network
Supporting the third party
to develop application
Improving carrier efficiency
and reducing cost
Next infrastructure
network: FTTx, LTE
中国电信香港公司 7

9. Cost Efficient Network Case 1: Network Evolution (continued)
Network evolution
All IP Network
Evolution
IP+TDM Hybrid
Network
Case
High efficiency and low cost
Core Network: Soft switch replaced TDM equipment
Power saved:
50%
Space saved:
60%
Weight decreased: 60%
3G distribution
base station
Wireless base
station evolution
Case
Power divider
BBU
Compared with metro station, BBU+RRU:
Power saved:
90%
Space saved: no need equipment room, easy to deploy
Air conditioner: no need
中国电信香港公司 8

10. Cost Efficient Network Case 2 : Cloud Computing IDC
Asia biggest cloud computing IDC in Inner Mongolia:
Opened in August, 2013
New Technology :
Cloud computing
HVDC power supply system
Accurate air delivery system
Ventilation system
Others (Cost-efficient air
conditioner system)
PUE
1.27
1.60
IT Equipment Power kw
30240
30240
IDC Total Power kw
Advanced CFD simulation
38405
48384
Electricity saved per year kwh
9979
Cost saved per year
(Million USD)
13.43
中国电信香港公司 9

11. Cost Efficient Network Case 3 : New Technology in Supporting
Facilities Energy Saving
Energy Saving
Scenario Recommend
Power supply
system energy
saving
20%
1
2
Intelligent heat transfer
system
18%
1
2
Accurate air delivery
system
Air conditioner
energy saving
intelligent ventilation
system
15%
Battery constant
temperature cabinet
3
23%
switching power supply
Energy saving
2
2
6.5%
HVDC power supply system
19.5%
1
3
Polar energy
Clean energy
1
Telecom equipment room 2 Base station room 3 IDC
Wind solar hybrid Power
system
中国电信香港公司
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12. Cost Efficient Network Case Study: Benefit of cost efficient
network
 The annual growth rate of power consumption per unit revenue has been reduced
year by year.
 Power consumption per TB has dropped significantly in recent years.
KWH/1000USD
350
250
27.44%
274
215
342
328
345
344
30.00%
25.00%
19.71%
20.00%
15.00%
150
4.27%
50
10.00%
0.88%
5.00%
-0.29%
0.00%
2008
-50
2009
2010
2011
electricity consumption/1000USD
600
500
2012
2013E
growth rate of electricity consumption/1000USD
0.00%
KWH/TB
504.59
Source: China Telecom, 2012
-10.00%
406.2
400
-19.50%
300
200
-5.00%
274.38
-32.45%
100
-20.00%
171.89
-37.35%
105.18
64.08
-38.81%
-39.08%
0
-30.00%
-40.00%
2008
2009
2010
electricity consumption/TB
2011
2012
2013E
growth rate of electricity consumption/TB
中国电信香港公司
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13. Cost Efficient Network Case 4: Telecom infrastructure coconstruction and sharing
Background: Duplicated construction is serious in China. For example: access fiber utilization is about
30%.
Reduce CAPEX (improve utilization)
Benefit
Save land
Save energy
Protect environment
Requirement by China Government
Infrastructure
Sharing rate
(no less than)
Co-construction rate
(no less than)
Iron Tower
30%
42%
Pole supported
transmission line
52%
15%
Base station
33%
30%
Pipeline
50%
16%
Indoor distribution system
Co-construction
Co-construction
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14. Cost Efficient Network Case Study: Benefit by
infrastructure co-construction and sharing
Expenditure saved/CAPEX
Expense saved by co-construction and sharing
Billion USD
3
2.8
2.5
2.5
2.1
40.0%
2
1.5
1.1
1
0.5
0
50.0%
30.9%
29.6%
31.8%
30.0%
20.0%
17.7%
2009
10.0%
2010
2011
2012
Source: MIIT (Ministry of Industry and Information Technology of China), 2013
Source: MIIT, 2012
Infrastructure
Unit
Joint construction and sharing
Iron Tower
Piece
27,000
km
50,000
Transmission line
km
79,000
Base station
Piece
36,000
Pipeline
km
19,000
Indoor distribution system
Set
4,000
Pole supported transmission line
中国电信香港公司
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15. Summary
Building a cost efficient network is becoming a MUST for us
If you would like to know more about us, what can we
do for you? then come and visit us at stand F26
中国电信香港公司
14

16. Contact us
Email : southafrica@chinaccsi.com
Tel:
+27 116562576
Website: http://www.chinaccsi.com

17. Our Cooperation with CT

Service coverage in over 60 countries and regions including Hong Kong, Macau, Middle East, Southeast Asia, Africa and America

China Telecom mainly serves Chinese multi-national enterprises, operators and international companies while CCS mainly provides
ICT infrastructure service. The cooperation between the two can provide customers with a total ICT solution .
Belgium
Canada
Turkey
Egypt
Libya
Algeria
USA
Syria
Morocco
Niger
Mali
Mexico
Venezuela
Cote d’lvoire
Columbia
Iran
Chad
Senegal
Kazakhstan
Sudan
Nigeria
Cameroon
Congo (Kin)
Zambia
Thailand
Saudi
Arabia India
Malaysia
Ethiopia
Kenya
Uganda
Angola
Brazil
Uzbekistan
Beijing (CCS HQ)
Qatar
Nepal Myanmar
Pakistan
Vietnam
HK(CCSI HQ)
UAE Bangladesh
澳门
Cambodia
Singapore
Sri Lanka
Indonesia
Tanzania
South
Africa
Zimbabwe
Namibia
Mauritius
New
Zealand
Botswana
CT overseas platform
CCS overseas platform
CCS main business regions overseas
中国电信香港公司