Zhang Chunjiang: 50% of This Year's Spending on Broadband, Accelerating Broadband Strategy

June 6 news, China Netcom Group Chairman Zhang Chunjiang recently revealed that 50% of China Netcom's 2007 capital expenditure will be invested in broadband.

With the decline of traditional fixed-line telephony services, fixed-line operators have gradually shifted their focus to data value-added services. It is understood that China Netcom has adopted broadband, internationalization, and the Olympics as its three major corporate strategies, with the broadband strategy at the core. China Netcom's goal is to increase the proportion of broadband service revenue to 32%. In the first quarter of this year, China Netcom's broadband subscriber base approached 16 million, nearly quadrupling from 3.28 million in 2003. According to China Netcom's 2006 financial report, broadband revenue grew by 34.9% in 2006, reaching RMB 10.556 billion. By the end of 2006, broadband subscribers had grown by 31.4% to 15.081 million, and the share of growth-oriented service revenue in total revenue rose by 5.8 percentage points to 26%.

A recent survey by UK-based research firm PointTopic shows that broadband subscribers worldwide have exceeded 281 million, with a broadband penetration rate of 14.5%. Broadband subscriber growth in the Asia-Pacific region has been even more rapid. China has also demonstrated strong broadband development momentum in recent years, with an average growth rate exceeding 50%. As of March this year, China's broadband subscriber base reached 56.26 million. However, statistics show that China's current broadband penetration rate is still below 4%, lagging behind developed countries and indicating significant growth potential.

Zuo Xunsheng, Vice President of China Netcom Group, previously stated that during the Olympic Games, China Netcom will increase broadband infrastructure construction and technology application to meet Olympic requirements. Industry analysts believe that China Netcom can not only enhance its broadband network brand through the Olympics but also use this opportunity to expand into the international market.