PacificNet Positions Itself for the Launch of China 3G Services and Unveils
its 3G Value-Added Services and Mobile Games at ITU
BEIJING, Dec. 7 /Xinhua-PRNewswire/ -- PacificNet Inc. (Nasdaq: PACT), a
leading provider of customer relationship management (CRM), mobile internet,
games and gaming, ecommerce and Value-Added Telecom Services (VAS) in China,
announced today that its Chairman and CEO, Tony Tong, Victor Tong, President,
and Super Wang, General Manager of PacificNet's Guangzhou 3G subsidiary,
discussed its 3G strategy while attending the 3G Showcase at ITU Telecom
World 2006 ( http://www.ITU.int/WORLD2006/ ). ITU Telecom World is the
largest telecom conference and expo in the world and is hosted at the
AsiaWorld-Expo, Hong Kong, from December 4-8, and is sponsored by the
International Telecommunications Union (ITU) and attended by all of the major
telecom leaders of the world.
(Logo: http://www.prnasia.com/sa/200611281258.jpg )
Commenting on the status of the long anticipated issuance of 3G licenses
in China, Mr. Wang Xudong, China's minister of the information industry,
announced at the ITU Telecom World 2006 that China will issue 3G
licenses "very soon", and reiterated a commitment to enable operators to
offer 3G services during the 2008 Olympic Games in Beijing. Mr. Zuo Xunsheng,
CEO of China Netcom (CN) also declared at the ITU that China Netcom and China
Telecom (CHA) could receive the 3G licenses as early as February 2007. In
addition, Mr. Chen Wu, VP of China Unicom Macau Branch, announced at the ITU
that Macau Unicom plans to launch 3G services in Macau in the second quarter
of 2007.
With the long anticipated issuance of 3G licenses in China, the ITU
Telecom World 2006 draws a lot of attention from industry leaders, telecom
experts, telecom scholars, and government officials involved with 3G
services. These include China's Ministry of Information Industry (MII),
China Mobile, China Unicom, China Telecom, China Netcom, Huawei, ZTE,
DaTang's TD-SCDMA, Qualcom, Nokia, Motorola, Samsung, NMS, and leading
hardware vendors, handset providers, content providers, and value-added
service provides involved in the 3G industry value-chain. 3G services enable
video calls, faster data downloading speeds and mobile Internet access.
Mr. Tony Tong, Chairman of PacificNet, discussed the company's 3G value-
added service offerings with the imminent roll-out of 3G services in China by
its telco partners. Mr. Tong stated, "As discussed by China's leading
government and telecom leaders at the ITU this week, we expect that the
Chinese government will officially grant the 3G licenses within a few months
and we are sure there will be 3G networks operational in the main cities
before the Olympics in 2008, or even earlier. We welcome the imminent
arrival of 3G services in China. No matter who gets the 3G licenses,
PacificNet will benefit because we have good working relationships with all
four of the major telecom operators in China: China Mobile, China Unicom,
China Telecom and China Netcom."
PacificNet has been an active player involved in providing value-added
telecom services, mobile games, mobile applications, and CRM services in
China, the world's largest mobile user base with about 400 million mobile
users. With China's anticipated 3G launch, the stakes are high and the
opportunities are immense for new 3G value-added services. Telecom users in
China can experience our iPACT VAS through our broad geographical presence
and local VAS offerings in 27 provinces in China through our VAS operating
subsidiaries including Guangzhou 3G, Clickcom, and Wanrong. We look forward
to the launch of 3G services in China as we expect it will drive the demand
for PacificNet's iPACT, mobile games, CRM, IVR, and VAS services. We are well
positioned to capture the business opportunities in China's future 3G
services market.
PacificNet recently signed an agreement with China Unicom to become one
of the designated value-added short message services (SMS) providers for Uni-
Info, a recently launched mobile information service to service mass market
China mobile users. Uni-Info is an SMS-based information subscription and
delivery-on-demand service launched by China Unicom and is now available to
its GSM (Global System for Mobile Communications) and CDMA (Code Division
Multiple Access) phone users. Its content offerings include a wide variety of
services such as entertainment and financial information, as well as
interactive gaming and dating, enabling its subscribers to enjoy the
convenience and access to first-hand information via SMS in over 20 cities
and provinces in China.
PacificNet has also been a long term CRM service provider for China
Telecom in providing Customer Relationship Management (CRM) consulting,
telemarketing management and call center training services. China Telecom
has selected PacificNet for multiple and on-going projects to enhance the CRM
service level and telemarketing management capability of China Telecom's
customer service center called the "10000 Information Hotline."
PacificNet's MOABC.com is a leading mobile internet portal in China with
11 million registered users and boasts one of the top-ranked mobile internet
sites, featuring mobile social networking services (SNS), mobile games, and
entertainment. This free WAP portal provides a variety of mobile internet
services such as news, mobile gaming and entertainment services, mobile
blogs, mobile email (Mo-Mail), Avatar and virtual pets, mobile online dating,
mobile instant messaging, virtual communities, mobile social community and
virtual showrooms to China's increasing mobile phone and internet user base.
"With the early success of our mobile WAP portal services in China, we
believe the market potential is strong for our WAP.MOABC.COM mobile portal
and community, especially in light of the impending launch of 3G services in
China," said Victor Tong, President of PacificNet. "With over 11 million
registered users, we believe that our fun and entertaining mobile portal and
sizable user-base will contribute positively to PacificNet's overall strategy
in mobile gaming and e-commerce. With China being the largest and fastest
growing telecom market in the world, with over 400 million mobile
subscribers, we believe that our strong experience in mobile social
networking services (SNS) and mobile games will contribute positively to
PacificNet's growing CRM and gaming service network in China and Macau."
According to industry reports, there are currently 151 3G license holders
operating in 56 countries and 207 3G-networks globally, serving a total of
200 million 3G users worldwide. In Asia, 3G subscribers have reached a market
share of 38% while 62% of the total mobile subscribers are 3G enabled in
Japan and Korea, respectively. According to estimates, the total anticipated
3G market size in China will reach RMB 285 billion (US$35.6 billion) within 5
years after the launch of 3G in China, creating about 30 million new jobs
annually in China's 3G services market. According to recent industry reports
by CCID and DoNews, 3G Killer Apps will concentrate on the 3Gs: Games,
Gambling and Girls, as mobile online games will become vastly more popular
with the launch of 3G networks in China. Forecasts frequently note that
online and offline mobile gaming differs greatly in terms of their service
models. Online gaming uses a telecom service model earning revenues from
traffic fees during play, while offline mobile gaming is simply a game
application downloaded onto a handset for a small fee. The forecasts predict
strong growth for WAP, JAVA and BREW, while the proportion of SMS-enabled
games will drop. With over 400 million mobile phone users, China has already
become the largest mobile population in the world. Moreover, the number of
mobile users is still growing rapidly and has far exceeded the number of PC-
based internet users, which is about 120 million, in China.
About ITU and China's 3G Standards
The International Telecommunication Union (ITU) is an international
organization established to standardize and regulate international radio and
telecommunications. It was founded as the International Telegraph Union in
Paris in May 17, 1865, and today is the world's oldest international
organization. ITU, headquartered in Geneva, Switzerland is an international
organization within the United Nations System where governments and the
private sector coordinate global telecom networks and services. Its main
tasks include standardization, allocation of the radio spectrum, and
organizing interconnection arrangements between different countries to allow
international phone calls.
3G (or 3-G) is short for third-generation technology. The services
associated with 3G provide the ability to transfer both voice data (a
telephone call) and non-voice data (such as downloading information,
exchanging email, and instant messaging) simultaneously. In marketing 3G
services, video telephony has often been used as the killer application for
3G. The European flavor of 3G is called W-CDMA, a technology with the
backing of Nokia and Ericsson; a version used by some U.S. carriers is called
CDMA 1000x; and China's is called TD-SCDMA. TD-SCDMA (Time-Division
Synchronous Code-Division Multiple Access) is a 3G mobile telecom technology
standard that has been submitted to the ITU by the Chinese government. In
May 2000, the International Telecommunication Union (ITU) approved TD-SCDMA
as a global 3G standard. Since then, China's domestic vendors, for the first
time, have control of a telecommunications industry standard, and bears the
responsibility of nurturing the technology's development to compete against
WCDMA and CDMA2000 1x EV-DO in China's 3G market. Domestic control of TD-
SCDMA means greater autonomy and potentially lower costs for domestic vendors
and operators. Currently, TD-SCDMA, WCDMA and CDMA2000 1X EV-DO, are the 3G
standards to be launched in China. With the full support of the Chinese
government and the TD-SCDMA Industry Alliance (TDIA), TD-SCDMA is well
positioned to compete in the China 3G market.
TD-SCDMA (Time Division-Synchronous Code Division Multiple Access) is a
3G mobile telecommunications standard, being pursued in the People's Republic
of China by the Chinese Academy of Telecommunications Technology (CATT),
Datang and Siemens AG, in an attempt to develop home-grown technology. On
January 20, 2006, the Ministry of Information Industry of the People's
Republic of China formally announced that TD-SCDMA is the country's standard
of 3G mobile telecommunication.
About PacificNet
PacificNet Inc. is a leading provider of Customer Relationship Management
(CRM), e-commerce and gaming technology in China. PacificNet's clients
include the leading telecom companies, banks, insurance, travel, marketing,
and business services companies, and telecom consumers, in Greater China.
PacificNet's corporate clients include China Telecom, China Mobile, Unicom,
PCCW, Hutchison Telecom, Bell24, Motorola, Nokia, SONY, TCL, Huawei, American
Express, Citibank, HSBC, Bank of China, Bank of East Asia, DBS, TNT, and Hong
Kong Government. PacificNet employs over 1,400 staff in its various
subsidiaries throughout China with offices in Hong Kong, Beijing, Shenzhen,
Guangzhou, Macau, and branch offices in 28 provinces in China and is
headquartered in Beijing and Hong Kong.
About Guangzhou 3G
PacificNet's subsidiary Guangzhou 3G is one of the leading value-added
telecom and information services providers in China with both voice (IVR and
call center) and data (SMS, MMS, WAP, JAVA, GPRS) connection to the four
major telecom operators: China Mobile, China Unicom, China Telecom, and China
Netcom, covering both mobile and fixed-line networks. Guangzhou 3G also
offers a wide variety of IVR and other wireless and fixed-line, value-added
telecom services including color ring back tone (CRBT) services, background
music (BGM) services, VICQ mobile instant messaging services, sports and
soccer news, weather forecasts, stock market, music and mobile karaoke,
mobile TV, games, entertainment, chat line and dating services. Guangzhou 3G
currently employs 238 staff and has offices in 26 provinces in China.
Safe Harbor Statement
This Company's announcement contains forward-looking statements.
Statements that are not historical facts, including statements about our
beliefs and expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. Potential risks and
uncertainties include, but are not limited to, PacificNet's possible future
losses, uncertain regulatory landscape in China, and fluctuations in
quarterly operating results. Further information regarding these and other
risks is included in PacificNet's Form 10KSB and other filings with the SEC.
