SHENZHEN, China -- ZTE Corporation (“ZTE”) (H share stock code: 0763.HK / A share stock code: 000063.SZ), today announced that China Telecom, the largest telecom carrier in China, achieved an industry breakthrough by deploying ZTE’s Ethernet Passive Optical Networks (EPON) Solution. By deploying the solution, China Telecom was able to successfully cutover between EPON technology that carries CDMA 1X services and EVDO high-speed data services to implement the world’s first EPON technology that offers 3G services.

The announcement is the culmination of the successful trial conducted by Shanghai Telecom, a subsidiary of China Telecom, in February 2009. Early last month, the company finally completed the cutover of the CDMA 1X service and EVDO high-speed data service over EPON and achieved on-site service test results with flying colors. During nearly one hour of continuous call testing, the voice service demonstrated good quality and stable signals, while the EVDO data service smoothly and steadily play online videos. This only proves that EPON is an alternative technology platform to help operators offer 3G services.

ZTE’s EPON Solution helped Shanghai Telecom to address transmission problem between its backend machine rooms and CDMA base stations located in remote facility. As a result, Shanghai Telecom is now able to provide its subscribers with excellent quality, high access speed along with rich, reliable and more convenient fixed CDMA convergence services. More importantly, Shanghai Telecom was able to reduce overall network construction cost – a key factor in launching its 3G service.

Today’s 3G networks generally have more stringent operational requirements including key features such as network clock delay, clock synchronization and network jitter, hence resulting in operators facing an enormous challenge to offer 3G services. ZTE’s EPON Solution has advanced features that not only address mobile base station backhaul for operations, but also provide unified access for backhaul and broadband services. This enables fast network construction and deployment, and helps in sharing of network resources, which ultimately reduces operators’ TCO and leading to maximizing their business profits.

“We’re pleased to provide Shanghai Telecom with our EPON Solution to help them get the recognition of being the first operator in the world to run 3G services over EPON. The success of the test indicates that there is a huge opportunity for EPON being widely adopted in different telecom networks such as GSM and TD SCDMA/CDMA. ZTE’s EPON technology helps carriers to enhance their All-services operation, along with lower cost to realize the convergence of fixed and mobile networks,” said Mr. Xu Ming, Vice President, ZTE Corporation.

ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763)