IR News

- Signed ADSL equipment export agreement for 70,000 lines with Xinjiang Province China Telecom for supply to 60 regions including the city of Hami
- LGE won the international bidding beating out global leaders such as Cisco and Alcatel as well as local players like Zhongxing
- LGE plans to build an ADSL equipment production line at its production subsidiary in Guangdong province, LG-TOPS, for full local supply
- To leverage the success of the ADSL bidding to win supply at the second bidding for CDMA by China Unicom

LG Electronics is advancing into China’s high-speed Internet equipment market in full force.

LGE announced that it signed an equipment supply agreement with Xinjiang Province China Telecom to ship ADSL (Asynchronous Digital Subscriber Line) equipment developed with LGE’s own technology (Model: AccesSTAR).

The agreement was signed between Managing Director Seok-hee Joo of LG-TOPS, LGE’s subsidiary in Guangdong province and Director General Jin Ming of Xinjiang Province China Telecom at a signing ceremony attended by Vice Chairman Yong-ak Ro of Head of LG China. Based on the agreement, LGE will supply ADSL equipment for over 70,000 lines to 60 regions including the city of Hami in Xinjiang province
LGE won the supply agreement through a highly competitive international bidding organized by China Telecom. It was first selected as the preferred company after beating out tough competition from not only leading foreign companies like Cisco, Alcatel, and UTSarcom, but also local players like Huawei and Zhongxing. LGE was then chosen as the official supplier after passing the product test.

Xinjiang Province is located at the center of the Western region development project currently pursued by the Chinese government and is a market with one of the highest growth potentials in China. As China Telecom plans to gradually expand service coverage area after initially starting its ADSL service with 60 regions, an equipment supply volume increase is anticipated.

LGE says that making LG-TOPS, its production subsidiary in Guangdong Province, the center for its ADSL business in China along with continuous marketing efforts based on products with global competitive edge played key roles in winning the lucrative contract.

LGE already has local production facilities for ADSL equipment at LG-TOPS and plans to use the ADSL contract in adding momentum to its advance to the Chinese market.

China started 512Kbps ADSL service from 2001 and according to the Center of Computer & Micro-Electronics Industry Development, a research center under the Ministry of Information Industry, ADSL demand is expected to jump to 1 million lines this year, then to 3 million in 2002 to reach 8.5 million lines by 2003.

“LGE is very much interested in expanding its presence in China’s telecommunications market especially in the CDMA sector. We are very encouraged with our performance so far. We have successfully launched our CDMA WLL products and now won a lucrative ADSL equipment contract here. We are now going to direct our efforts toward winning the second bidding for CDMA to be conducted by China Unicom,” said Managing Director Seok-hee Joo of LG-TOPS.