China Telecom HK, CTI Team

HONG KONG -- China Telecom (Hong Kong) International Limited ("China Telecom Hong Kong") and City Telecom (HK) Limited ("CTI") today announced to launch one-stop-shop IP-VPN services for connections between Mainland and Hong Kong. This breakthrough initiative is the first official announcement that China Telecom Hong Kong had made for "hand-in-hand" cooperation with a Hong Kong telecom operator.

In line with Closer Economic Partnership Arrangement (CEPA) directives, commercial cooperation between Mainland and Hong Kong is now closer than ever, arousing a pressing need for Pan-China communications. This trend is evidenced by the increasing use of cross border VPN business connecting company branches across various locations between Mainland and Hong Kong. With the one-stop-shop IP-VPN service offered by China Telecom Hong Kong and CTI, Hong Kong corporations can now access reliable dedicated network services to run diversified applications, such as file transfer, video conferencing, remote surveillance, mobile office, voice and video internal call services. In the past, such services were limited only to the large multinationals, but with this service partnership between China Telecom Hong Kong and CTI, these services are now available on a mass scale.

China Telecom Group aims to enhance "informationization" of corporations by delivering VPN benefits, which is one of its key initiatives to satisfy corporate customers' needs. The cooperation with CTI consolidates both parties' strengths and China Telecom Hong Kong is confident that it will captured corporate market share and enhance customers' satisfaction levels. Also, this joint campaign will increase brand awareness for Hong Kong corporate and retail consumers towards the whole China Telecom Group, achieving its long term goal to enhance brand awareness.

Whilst CTI has been working closely with China Telecom for years, this joint service promotion to Hong Kong customers marks a further breakthrough. China Telecom is the premier carrier in China, possessing the most extensive and reliable network coverage and facilities. CTI is Hong Kong's most innovative carrier possessing advanced fibre network, strong sales force and customized service support. This campaign was themed as "One-Stop-Shop", expressing our determination to integrate China Telecom and CTI's respective competitive strengths to provide unprecedented value and convenience to customers.

China Telecommunications Corp.

City Telecom (HK) Ltd.