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CHIEF Telecom Inc.

2001.06.29

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Industry ProspectsIndustry ProspectsIndustry ProspectsIndustry Prospects

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Telecom Telecom InfrastructureInfrastructure

CommunicationCommunication

InformationInformation

Broadband Broadband ApplicationApplication

Industry Structure of TelecomIndustry Structure of Telecom

The development of Telecom Ind

ustry is tied to the completeness of

the Telecom infrastructure.

The superior Telecommunication

environment is built on the Telecom

infrastructure, providing relevant co

mmunications products and derived

broadband services.

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The Trend of Multi-Service NetworksThe Trend of Multi-Service Networks

Current Telecom networks

provide one-to-many

connections and cause the

limitation.

Star topology can eliminate the

insufficiency of bandwidth.

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Multi-choice of BandwidthMulti-choice of Bandwidth

The only operator

Single choice of bandwidth

Telecom deregulation

Multi-service networks

Several bandwidth providers

Multi-choice of bandwidth

User 1

User 2

User 3

User4User 5

User 1

User 2

User 3

User 4User 5

Carrier 1

Carrier 2

Carrier 3

Carrier 4‧

‧‧

‧‧‧

‧‧‧

ChungHwa

TrafficAggregation

Center

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Declining price led to the specialized bandwidth providers Declining price led to the specialized bandwidth providers

Aggregation point of regional hubAggregation point of regional hub

Why need Tele-CenterWhy need Tele-Center

Demand of web hosting & co-location servicesDemand of web hosting & co-location services

Demand of services from Telecom usersDemand of services from Telecom users

Demand of connectivity between Carriers and ISPsDemand of connectivity between Carriers and ISPs

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Advantages of Neutral Tele-CenterAdvantages of Neutral Tele-Center

Carrier-neutral

Shared facilities can save infrastructure investment

Maximum choice from different service providers

Island characteristic country will requireone Tele-center

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CHIEF is a Neutral Tele-CenterCHIEF is a Neutral Tele-Center

CHIEF provides Telecom infrastructure facilities and telco

grade services : It gathers Local Operator, Global Carrier,

SSP, ASP, IDC, ISR, ISP & ICP, providing bandwidth

exchange services and related broadband products.

Clients

Clients

Clients

ClientsClientsClients

IDC

Local Operator

ISP

Global Carrier

CHIEF’s CHIEF’s Carrier HotelCarrier Hotel

Clients

Clients

Clients

ClientsClients

CHIEF’s CHIEF’s Application Application

PlatformPlatform

ICP

Clients

SSP

ISR

Clients

Clients

ASP

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CHIEF is a neutral

aggregator in Telecom

& information industry

CHIEF is a Tele-Center

CHIEF is an Exchange

Center

CHIEF‘s Cooperation ModelCHIEF‘s Cooperation Model

企業價值企業價值企業價值

Type ⅠOperators

Application Service

Providers

Telecom Hardware ProvidersCHIEFCHIEF

MarketplaceMarketplaceCHIEFCHIEF

MarketplaceMarketplace

Type ⅡOperators

Software Tool

Providers System Software Providers

Computer Hardware Providers

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Global Traffic ChartGlobal Traffic Chart

Resources ： ITU, 2000

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Taiwan Traffic ChartTaiwan Traffic Chart

Resources ： ING BARINGS, Aug. 2000

Market incoming minutes(M mins)CHT-incoming minutes(M mins)Monthly minutes(M mins)

0

500

1000

1500

2000

2500

98 99 00F 01F 02F 03F 04F

0

20

40

60

80

100

120

140

160

180

200

Market outgoing minutes(M mins)CHT-outgoing minutes(M mins)

Monthly minutes(M mins)

500

1000

1500

2000

2500

20

80

4060

100

120140160180200

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Telecom Service revenuesTelecom Service revenues

Resources ： ITU, 2000

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OperationOperationOperationOperation

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CHIEF can create innovative Telecom Services

CHIEF can create innovative Telecom Services

The Opportunity of CHIEFThe Opportunity of CHIEF

Differences

between

Telecom

Products &

Services

Time Gap

to Launch

Services

Competition

between

Telecom

Operators

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CHIEF‘s Resources & NicheCHIEF‘s Resources & Niche

CHIEFCHIEFCHIEFCHIEF

Huge TelecomMarket Size

Huge TelecomMarket Size

Up-trend Telecom Market

Up-trend Telecom Market

Industry Growth Following

Telecom DeregulationIndustry Growth Following

Telecom Deregulation

Right Time for

InvestmentRight Time for

Investment

Deep Understanding of

Telecom IndustryDeep Understanding of

Telecom Industry

First-Mover AdvantageFirst-Mover Advantage

Experience in Both

Telecom & IT IndustryExperience in Both

Telecom & IT Industry

Tremendous FinancialPerformance

Tremendous FinancialPerformance

Established Channels

Established Channels

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CHIEF‘s Black Hole Effects CHIEF‘s Black Hole Effects

CHIEFCHIEFTele-CenterTele-Center

CHIEFCHIEFTele-CenterTele-Center

Telecom Resources

Com

mun

icat

ion

Res

ourc

es

Internet

Resources

Local Operator Global Carrier

SSP

ASP

IDC

ISR

ISP

ICP

Customers

Customers

Customers

Customers

Par

tner

s

Partners

Part

ners

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Accomplishments Accomplishments

Taiwan Total Taiwan Total

Taiwan TotalTaiwan Total

Chief TotalChief Total

Chief TotalChief Total

Forecasted available bandwidth will be 300Gbps at the end of 2001

Forecasted available bandwidth will be 200Gbps at the end of 2001

Average 180M mins per month (In & Outbound)

5M mins per month (now)

47M mins per month (Year end)

Bandwidth

Voice

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CHIEF‘s StrengthCHIEF‘s Strength

Island characteristicIsland characteristic

CHIEF is the CHIEF is the Only & Only & Unique Unique

GatewayGateway

CHIEF is the CHIEF is the Only & Only & Unique Unique

GatewayGatewayBandwidth DemandBandwidth Demand

Traffic MomentumTraffic Momentum

Demand in Neutral Tele-CenterDemand in Neutral Tele-Center

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CHIEF‘s management PhilosophyCHIEF‘s management Philosophy

Identify in the early

stage of the

industrial

horizontal

diversification in

order to maintain

neutrality

Endeavor to

establish common

resources to be

shared with

partners

Gather all

members in the

value chain,

regardless of

their positions,

and cooperate

with each others

Cooperate with

other members

to sustain a

health, thriving

industrial

ecology

Diversified

SpecializationResource-

sharingIndustrial

CooperationWin –win Solution

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CHIEF’s Tele-CenterCHIEF’s Tele-Center

InfrastructureInfrastructureInfrastructureInfrastructureBackbone Networks

Access NetworksCarrier HotelData Center

ServiceServicePlatformPlatformServiceService

PlatformPlatformBilling System

Network ManagementPayment GatewayClearing House

E-CommerceE-CommerceE-CommerceE-Commerce EoSContent Delivery Sys.

MarketingMarketingMarketingMarketingTele-Marketing

Promotion ProgramChannelSystem Integration

TPIXTPIXData

Exchange Center

TPIXTPIXData

Exchange Center

TPVXTPVXVoice

Exchange Center

TPVXTPVXVoice

Exchange Center

TPCXTPCXContent

Exchange Center

TPCXTPCXContent

Exchange Center

CRMSCM

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CHIEF‘s Business CategoriesCHIEF‘s Business Categories

CHIEFCHIEF‘s Business Categories‘s Business Categories CHIEFCHIEF‘s Business Categories‘s Business Categories

C&C New Telecom Century ： Computer & Communication

Cooperation & Conflict

Carrier HotelCarrier Hotel

Exchange CenterExchange Center

ChannelChannel

ApplicationApplication

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CHIEF Multi-Vender, Multi-ServiceCHIEF Multi-Vender, Multi-Service

CHIEF Link / CHIEF Marketing

Multi-Media Access / Backbone Network

IDC 、 CHPSSP 、 STP

ASP

Type OperatorsⅠType OperatorsⅡ

Carrier HotelManagement

Service

Exchange Center

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CHIEF’s TeamCHIEF’s Team

President of InveStar Capital & Digitimes, Co-founder of Acer Group, Directors of listing companies

TCU

CTUChairman

Kenneth Tai

Vice ChairmanC. S. Tsen

NCKU

PresidentJohnson Lu

Sales Mgr., Acer Inc.,Sales Mgr., Acer Technology

KW CollegeElectronic Engineering

Managing Directors, Hinet/DCI,CTO, Chunghwa TelecomCTO, Taiwan Fixed Network Co.

COOLarry Chai

VP, Nortel Networks

GM, Global One Taiwan

Depaul U., M.S. in Telecom Northwestern U., Computer Science

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CHIEF’s Team (Cont.)CHIEF’s Team (Cont.)

PresidentCOO

PresidentCOO

Channel Service

/ Telecom

Business Unit

VP Tony Chang Telecom Technology

Business Unit

VP Johnny Liu

Information

Business Unit

VP Charles Chang

Taichung

Branch Office

VP Joy Chen

International

Business Unit

VP C.H. Tai

Kaohsiung

Branch Office

VP Peter LeeOperation

Management

Business Unit

VP Joyce Tsai

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CHIEF‘s MilestoneCHIEF‘s Milestone

Y1996~Y1999 Y2000 Y2001Y1991~Y1995

Establishment Help DGT to

establish front- and back-end information systems and online telecom services

Received data resell agency license from Chunghwa Telecom

Became the largest broadband service agent in Taiwan

Over 2000 distribution partners

Key customers : MCI WorldCom, Global One, etc.

Transform to Tele-Center

First Carrier Hotel in service

Key customers : eASP, AboveNet, etc.

Second Carrier Hotel launched

Hsinchu, Taichung & Kaohsiung sites completed

Establish presence in China

Key customers : UUNet, SingTel, etc.

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TPIX to be the densest node in East Asia

TPVX to be THE voice switching center in

Taiwan & East Asia

To be the Telecom Hub in Taiwan, Great China

& East Asia

TPIX to be the densest node in East Asia

TPVX to be THE voice switching center in

Taiwan & East Asia

To be the Telecom Hub in Taiwan, Great China

& East Asia

200Gbps bandwidth at the end of 2001 Taiwan’s only bandwidth hub

200Gbps bandwidth at the end of 2001 Taiwan’s only bandwidth hub

Strategy & GoalStrategy & Goal

L-TermL-Term

S-TermS-Term

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Categories Content Revenue

Carrier Hotel Establish or Customer-Design of data centers

and relevant Telecom equipment.

Provide hosting & co-location services to Type

I & II Service providers

Planning /

installation income

and lease income

Exchange

Center

Voice, data & content exchange and

aggregation centers, including TPIX, TPVX

and TPCX

Transaction fees

service charges

CHIEF‘s Revenue ModelCHIEF‘s Revenue Model

Channel Marketing and sales arm of multi-brand

bandwidth related services

Commissions and

service charges

Application Provide e-commerce transaction services,

corporate applications, and entertainment /

lifestyle services

User fees