The ABC’s of ZTE

THE Chinese company now in the middle of the controversy surrounding the Arroyo administration’s initiative to set up a $329-million national broadband network to link government offices, Zhong Xing Telecommunication Equipment Company Limited (ZTE Corporation) was founded as Zhongxing Semicondudctor Co. Ltd. in 1985 in Shenzhen, China. The company was established by a few state-owned companies affiliated with China’s Ministry of Aerospace Industry.

By 1996, ZTE had begun the transition to a multi-product research and development strategy, adopting wireless switching, transmission, access, videoconferencing and power supply systems.

Now, ZTE is a global provider of telecommunications equipment and network solutions. Its shares are publicly traded on the the Shenzhen and Hong Kong Stock Exchanges. It is China’s largest wireless equipment provider and its second-biggest manufacturer of telephone equipment.

ZTE develops and manufactures telecommunications equipment for fixed, mobile, data and optical networks, intelligent networks, next generation networks, and cellular phones. Its main product lines include switching, access, transmission, mobile communications, data communications, and videoconferencing. The company’s products can be found in around 40 countries.

It has worked on many projects around the world. ZTE has conducted a PSTN (public switched telephone network project) in Bangladesh. It built Softswitch and CDMA (code division multiple access) networks in China, as well as a CDMA WLL (wireless local loop) network in Algeria. It is also the largest CDMA provider to BSNL, India’s largest telecoms service company. It provided telecoms services for the 2004 Olympic games in Athens, Greece. It has also teamed up with telecom companies such as Alcatel, Ericsson, France Telecom and Portugal Telecom.

ZTE has won a $66-million contract to modernize signaling and telecommunication systems for railway lines in Vietnam and has signed a contract with Tunisie Telecom to deploy a national transmission network in Tunisia. It has just been appointed to build Portugal’s backbone transmission network.

In 2005, it was ranked 80 among the Top 100 Information Technology Companies by BusinessWeek. The magazine also included ZTE in its 2006 ranking of China’s top 20 brands. ZTE global marketing director Howard Xue said that ZTE has completed projects in over 120 countries, and has been doing business in the Philippines since 2002.

In his Philippine Star column, Jarius Bondoc wrote that ZTE has been having problems in other countries such as Mexico, Ecuador, Ethiopia, Indonesia, Liberia, Libya, and Burma.

Mexico City residents have accused their mayor of mistaken priorities for commissioning ZTE to set up high-speed internet and broadband hotspots instead of using funds for water and electricity.

ZTE has been accused of graft and bribery in Ecuador and Ethiopia, and price dumping in Indonesia. In Liberia, ZTE’s country manager and his co-conspirators have been indicted for bribery. The company is being investigated in Libya for submitting false claims of track record and technical skill. There is an ongoing probe in Burma for reportedly corrupting a general who is also the minister of post and communication.

ZTE has denied Bondoc’s allegations that it bribed Commission on Elections chairman Benjamin Abalos Sr. and provided him with women in order to broker the NBN deal.

View the ZTE advertisement.

The company has defended its contract with the government and denied bribing other public officials.

Securities and Exchange Commission records show ZTE Corp. has the following officials in 2002:

Board of Directors

• Zhang Taifeng
• Hou Weigui
• Zhu Kerang
• Yin Yimin
• Shi Lirong
• He Shiyou
• Li Juping
• Liu Wenping
• Ma Shiping
• Wen Huiguo
• Chen Geng
• Jiang Zhizhong
• Chen Xisheng

Board Secretary

• Feng Jianxiong

General Manager

• Hou Weigui

Deputy managers

• Zhou Susu
• Wei Zaisheng
• Qiu Weizhao
• Fang Rong
• Ni Qin
• Ding Mingfeng
• Xie Daxiong
• Ye Weimin
• Chen Jie
• Zhou Wengou
• Zhang Chuanhai