China Telecom and its subsidiaries, China Telecom Global and China Telecom Americas, offer wide-ranging advantages including strong transmission, domestic network and local support capabilities to multinational companies (MNCs) that require deep domestic connectivity in China to support their large or rapidly growing operations.
That’s according to Gartner’s research report Critical Capabilities for Network Services, Asia/Pacific, which stresses the importance of MNCs partnering with the right Chinese internet service providers to successfully establish or grow operations in the country.
“A large number of global and regional providers support the marketplace,” the report states. “While their network capabilities are fairly comparable on the surface, their business focus, target customers and consequently their product and service strategies can differ significantly.”
That’s why communication service providers’ (CSPs’) ability to support MNCs with regional network requirements is so important, and why MNCs must look beyond their Chinese incumbent provider to find the CSP that best serves their needs.
Key Findings for MNCs
The Gartner report found that MNCs with operations in emerging markets such as China want international CSPs to extend their coverage into these markets. This would be either through multiprotocol label switching (MPLS) interconnections or virtual private networks (VPNs), along with managed customer premises equipment (CPE) services.
The report also revealed that CSPs are introducing direct connections to cloud providers, as well as software-defined wide-area network (SD-WAN) and network function virtualization (NFV) services. However, “most are in the early stage of implementation, and product availability and features differ significantly.”
Key Recommendations for MNCs
The Gartner report recommends that MNCs select Chinese internet service providers based on their ability to meet their primary needs for regional connectivity, extended domestic reach, low-latency service or high-capacity requirements.
MNCs looking to enter Asia–Pacific markets should also seek to extend their relationship with their CSP to include direct connections to cloud providers such as Amazon Web Services (AWS) and Microsoft Azure.
And planning to migrate from CPE to NFV services using cloud-based services and virtual CPE will offer MNCs operating in China faster deployment, easier management and cost savings.
Case Study: China Telecom
The Gartner report compared the performance and capabilities of 14 global CSPs against its key findings and recommendations.
It concluded that China Telecom’s “strong domestic network and local support capabilities give it an advantage when supporting large MNCs with extensive China requirements.”
This is evidenced by the fact that China Telecom has won more non-Chinese MNC customers in the past 12 months from a range of industries. These include the banking and finance industries which require effective low-latency services; logistics and retail companies with a large number of sites; and e-commerce companies that require large bandwidth.
“In all instances, China Telecom has a few key competitive attributes – large bandwidth on key routes, well-diversified networks, competitive pricing and the ability to support requirements in China,” the report states. “China Telecom is also the leading provider for Chinese MNCs.”
The report found that China Telecom has a competitive low-latency service that connects 13 financial centers around the world and provides a choice of routes, all with guaranteed latencies.
China Telecom also has “strong transmission capabilities and rapidly improving IP VPN and Ethernet networks, enabling the provider to increasingly compete for MNCs with international networking requirements,” the report states.
China Telecom has significantly invested in global infrastructure and has Ethernet over MPLS (E-VPL and E-LAN) services connecting 10 markets in the Asia Pacific and 34 cities in China.
“Its MPLS network in the Asia Pacific covers 10 markets, with extensive MPLS network-to-network interfaces (NNIs) to extend its coverage, including connectivity to many emerging markets,” the report concludes.