UTStarcom Wins More China Deals

ALAMEDA, Calif. -- UTStarcom Inc. (Nasdaq: UTSI), a leading provider of wireless, wireline, and broadband access equipment, today announced that it has signed a contract with Beijing China Netcom valued at $57.9 million for UTStarcom's IP-based PAS (Personal Access System) (iPAS) platform. Beijing China Netcom will deploy iPAS in the central city area of Beijing.

"Operators in China continue to show strong acceptance of our PAS and iPAS products," said Ying Wu, president and CEO of UTStarcom China. "We initially introduced PAS technology as a telecommunication option for smaller suburban cities. However, the solution has proven ideal even for China's largest metropolitan areas, including Beijing, which has a population of 12.8 million. We expect to see more opportunities for both PAS and iPAS deployments in cities throughout China, as both customers and operators benefit from UTStarcom's technology."

Based on the terms of the contract, UTStarcom's softswitch-based iPAS system will offer comprehensive voice and data services to customers in a 400-square-kilometer area in the central city area of Beijing. Beijing China Netcom initially launched the service on May 17, 2003, targeting large corporate users such as government institutions, hospitals, and universities. Once deployment is complete, PAS will be available to everyday consumers to enjoy wireless communication in all of Beijing city proper, as well as in the 10 surrounding county-level cities. Beijing China Netcom also launched a short message service (SMS) and plans to gradually offer the complete value-added services of wireless Internet access, wireless email, and online content browsing.

"We're very happy with the performance of UTStarcom's iPAS systems, which are already in use in some hospitals and government buildings," said Zhao Jidong, general manager of Beijing China Netcom, at the Beijing PAS service launch on May 17. "We're encouraged by the positive feedback from PAS customers and believe both individuals and corporations will widely accept the technology, given the large potential market and broad range of PAS services."

Due to its relatively low radiation level and quick deployment time, UTStarcom's PAS technology has been used successfully for communications purposes at three of Beijing's hospitals during the recent SARS epidemic. UTStarcom and Beijing China Netcom co-donated US $1.2 million worth of PAS infrastructure, phones, and handsets to provide voice services for SARS patients and the hospitals' medical staff.

In a separate release:

UTStarcom Inc. (Nasdaq: UTSI), a leading provider of wireless, wireline, and broadband access equipment, today announced that it has signed a contract expansion valued at approximately $20 million with China Telecom Guangdong province for additional handsets for new subscribers, as well as expansion of its IP-based PAS (Personal Access System) (iPAS) system.

The contract supports system expansion of Zhong Shan, Fo Shan, Shun De and Dong Guan, which are four neighboring cities of Guangzhou, the provincial capital of Guangdong. In addition, a portion of this contract will go directly to the production of handsets to meet increased subscriber demand in those four cities, as well as in Guangzhou city proper. The five cities launched PAS service respectively in April 2003, resulting in nearly 300,000 subscribers in less than two months of service. The cities are among the most affluent and are experiencing some of the most rapid economic growth in Guangdong. China Telecom is expanding the previous contracts to increase system capacity and network coverage to satisfy consumer demand.

"Guangdong province and the surrounding cities make up one of the largest telecom markets in China for all major operators and equipment vendors in China," said Ying Wu, CEO of UTStarcom China. "This expansion contract further demonstrates the strong market acceptance of PAS in China and the need for accelerated handset production and system expansion to keep up with demand."

Additionally, China Telecom Guangdong province will soon offer value-added services with PAS, such as short messaging service (SMS), in all cities that have PAS services.

UTStarcom Inc. China Netcom Corp. Ltd. China Telecommunications Corp.