Cisco Teams With China Telecom To Build Information Highway; Cisco Wins Framework Cooperation Agreement to Power ChinaNet With 500 Cisco 12000 Series Internet Routers.

Business Editors/High-Tech Writers

BEIJING--(BUSINESS WIRE)--May 7, 2001

Cisco Systems, Inc. (Nasdaq:CSCO), the worldwide leader in networking for the Internet, has signed a framework cooperation agreement with China Telecom to power ChinaNet nationwide. Under the agreement Cisco will provide more than 500 high-speed Cisco 12000 and 12400 Internet routers over the next year to help China Telecom build a robust, convenient, and stable information highway stretching across China.

According to the agreement, Cisco will provide network equipment to China Telecom's ChinaNet, currently the largest ISP in China, to expand its nodes in more than 300 cities, helping China Telecom to extend multiple value-added Internet services to provinces throughout the country. This initiative further consolidates the strategic agreement struck between Cisco and China Telecom last August. Under that agreement, Cisco worked with ChinaNet to expand 54 nodes of its backbone network using Cisco 12000 series Internet routers.

China Telecom chose Cisco equipment based on the following factors. First, Cisco's products and solutions fully satisfied China Telecom's technical requirements. Second, employing Cisco's standardized Cisco 12000 and 12400 series Internet routers throughout the country will support China Telecom's nation-wide development of its IP-based value-added services like MPLS and virtual private networking (VPN). Third, the Cisco solution ensured industry leading support services, including 24/7 technical centers and experienced, high-caliber technical support teams.

"We are very pleased to be developing China's Internet infrastructure with China Telecom," said Jia-Bin Duh, managing director, Cisco Systems China. "China has put a high priority on developing its information technology infrastructure and the Internet will play a large role in that development. Cisco has also made a significant commitment to the Chinese market and we are very pleased that we have been selected to help expand ChinaNet nation-wide."

In the Asia Pacific region and in China, Cisco Systems is the clear market leader in the high-end router market. The company has an 80%+ market share in the region and in the Chinese market according to the latest quarterly data from market researcher IDC.

Specifically designed by Cisco for service provider IP backbones, the Cisco 12000 series Internet router family is capable of satisfying current IP backbone demands for bandwidth, performance and reliability. The 500 12000 series routers ChinaNet is deploying will accelerate transmission speeds throughout China, in order to create a more rapid and stable core IP backbone.

Following the completion of three phases of expansion, ChinaNet now possesses China's highest speed IP network backbone. This current deployment will also lay the foundation for upgrading the backbone to 10Gbps connections as traffic growth increases. The interconnection speeds across the backbone have been increased from 155Mbps to 2.5Gbps, boosting the overall network bandwidth to 800G bps. ChinaNet's physical nodes cover more than 300 cities in 31 provinces, autonomous regions, and municipalities, extending services to all regions where traditional phone service networks are located. This makes ChinaNet China's leading Internet backbone with the highest bandwidth, the most extensive coverage, most stable performance, best functionality, and the richest source of information content.

In expanding ChinaNet, China Telecom strengthened its cooperation with major ISPs both at home and abroad to realize interconnection between ChinaNet and other major Internet backbones. ChinaNet boasts international gateway bandwidth of up to 3.3G, and has made large investments in fiber MAN and high-speed access networks. Based on fiber-to-residence, fiber-to-building, and fiber-to-curb (FTTX), ChinaNet employs FTTX+LAN technology to provide 10-100M broadband access for commercial, business and residential customers. In cities with the demand, ChinaNet built ADSL networks to provide access bandwidth of up to 2-8Mbps for PSTN users through twisted pairs, bringing the convenience of backbone acceleration and a non-restricted web-surfing experience to users' homes.

About Cisco Systems

Cisco Systems (Nasdaq:CSCO) is the worldwide leader in networking for the Internet. Cisco news and information are available at http://www.cisco.com.

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