News Release

Cisco Selected for China Telecom's "ChinaNet" IP Backbone Northern Network

Beijing, P.R. China, October 10, 2002 - Cisco Systems, Inc.
Oct 10, 2002

Beijing, P.R. China, October 10, 2002 - Cisco Systems, Inc. announced today that China Telecom has selected Cisco technology and products for the construction of its northern ChinaNet IP backbone network expansion. The network will connect 10 provinces, including Beijing and Tianjin, and will maintain China Telecom's competitiveness across China, while maintaining service for its already large customer base in the north. The project will use carrier-class equipment such as the Cisco 12000 Series Internet routers, Cisco 7000 series routers.

Following the restructuring of China Telecom by China's Ministry of Information Industry (MII), the company's northern assets were absorbed by China Netcom. To provide competitive services in North China, as well as continue service to current customers, China Telecom is rebuilding its entire ChinaNet IP network for the north. Increased regional capacity allows for the smooth flow of data over China Telecom's nationwide network, supplying subscribers with a superior broadband experience and significantly improving Internet development in China. Domestic enterprise and private customers will now have nationwide access to the fastest Internet connections, advanced communications services such as Multiprotocol Label Switching (MPLS) virtual private networks (VPNs), and greatly expanded multimedia capabilities. The expanded network architecture, coverage and service portfolio will significantly increase China Telecom's revenue and competitive advantage.

"We are very pleased to have been selected by China Telecom for the ChinaNet network. The agreement underscores the quality and strength of the business relationships that we have forged with China Telecom. Cisco understands the significant place this backbone network plays in China Telecom's growing operations, and we are very excited that we will play such a major role in helping China Telecom, China's leading operator, to build this important network," said Jia-Bin Duh, President, Cisco China. "With Internet Protocol becoming the standard for service in the domestic market, we see Cisco being able to make great contributions to the future development of China Telecom and China's telecommunications market."

China Telecom chose to continue its long-term relationship with Cisco in re-establishing its presence in the north due to its success and satisfaction with Cisco products and services. China Telecom will maintain its considerable investments in both nationwide backbone network technology and future MAN networks by ensuring that all systems are compatible and take advantage of Cisco technology innovation. The Cisco solution will allow China Telecom to offer innovative services and applications to meet the growing demands of customers now and in the future.

ChinaNet's northern expansion, to be completed in 2002, will cover Beijing, Tianjin, Liaoning, Jilin, Heilongjiang, Inner Mongolia, Hebei, Henan, Shandong, and Shanxi. Once completed, the northern network will be connected to China Telecom's 21-province service area in the south of China. The ChinaNet Backbone Northern Expansion includes northern 15-city nodes and international gateways, providing Internet service, international Internet transit service, MPLS VPNs, among other services.