Strictly Confidential

Table of Contents

1. Market Forecast
2. Key Target Customers
3. Product Strategy
4. Strategic Partnerships
5. Channel Strategy
6. Brand Strategy
7. Organization

4-1
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Summary

 The valuechain for provisioning of enterprise solutions has five main components – Content & Services,
Technology Integration, Mobile Device, Mobile Network, Customer Service. To ensure successful
delivery of enterprise solutions, CKAD should establish partnerships with Application Service Providers
and Systems Integrators
 The need for win-win partnerships is increasingly recognized among both ASPs, Systems Integrators,
customers and operators and CKAD should carefully assess target level of influence, ownership and risk
sharing for each partnership type and opportunity
 A formalized partnership program will help CKAD to attract the best partners, facilitate negotiations and
ensure desired benefits for CKAD:

• Application Service Provider (ASP). The type of partnership pursued should be defined based on the
strength of the ASP’s capability and the value it brings to ZMCC. ASPs will be classified into four
levels – Strategic partner, Premier partner, Selective partner and Basic partner
• System Integrators. Partnerships with system integrators allows CKAD to effectively deliver
enterprise solutions, while bringing significant benefits to systems integrators. CKAD should establish
two types of partnerships with system integrators - Strategic Partners and Outsourcing Partners.
Strategic Partners cooperate with CKAD in both sales and marketing, while Outsourcing Partners take
the role of sub-contractors and CKAD owns and controls the customer interface

4-2
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Summary (continued)

 We have developed a long list of ASP and SI partners based on A.T. Kearney’s internal database,
interviews with industry practitioners and desktop research :

• ASP partners are assessed across four groups of criteria – market presence, company stability,
technology capability and industry focus. A.T. Kearney has compiled the results in a detailed ASP
partner database, including detailed profiles and assessments of 100 candidates.

• SI partners are assessed across four groups of criteria – market presence, company stability, systems
integration and industry focus. Specific sub-criteria and a scoring scheme have been defined to enable
screening and selection. A.T. Kearney has compiled the results in a detailed SI partner database,
including detailed profiles and assessments of 60 candidates

The Excel Spreadsheet partnership database and tools are shared with ZMCC as part of project final
deliverables.

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The valuechain for provisioning of enterprise solutions has five main components
and a range of different players
Simplified
Valuechain for Provisioning of Enterprise Solutions

Content Technology Mobile Mobile Customer

& Services Integration Device Network Service

Value • Develop and provide • Integrate and enable • Delivery of • Enable transmission • Ensure provision of
Added applications applications application to end- of data and service to end-
users information customer

Scope of • Application • Systems integration • Mobile terminal • Mobile network • Service sales and
Activities development • Platform provision specification, access, transport, marketing,
• Application provision design, and and associated customer support,
development functions billing, and
• Authentication
collections

Selected • Application Developer • Systems Integrator • Device • Operators • Operators

Players • Application Service • Technology Provider manufacturer • MVNO • ASP
Provider • MVNO
• Software provider

Source: A.T. Kearney 4-4

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To ensure successful delivery of enterprise solutions, CKAD should establish

partnerships with Application Service Providers and Systems Integrators

Application Service Required partners as technology providers for

Providers providing and developing both horizontal and
vertical applications

Required partners for vertical solutions that

System Integrators must be tailored to industry or customer specific
business / organizational requirements

Source: A.T. Kearney 4-5

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The need for win-win partnerships is increasingly recognized among both ASPs,
Systems Integrators, customers and operators …

Selected Quotes on Partnerships

ZMCC should provide non-commercial support,

For application with large potential but high risk,
especially in marketing and promotion, e.g. co-
ZMCC should proactive invest to help the ASP
branding opportunities

A National ASP A Shanghai-based SI

ZMCC should identify and invest in selected and ASP
ASPs that develop potential killer
applications

ZMCC’s Key Account Managers will not always know ZMCC Manager
how to sell our applications, so we should join forces in We application developers lack marketing
co-selling capability and client base…

A National SI and ASP

A Local Zhejiang ASP

We only want one point of contact and we hope ZMCC can We don’t like being bothered by so many Systems Integrators
recommend ASPs and Systems Integrators, as ZMCC has a and software companies and we expect ZMCC to come to us
strong brand and good reputation together with pre-selected partners

Client, Government Client, Customs Office

Source: Field Interviews, Focus Groups 4-6

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… and CKAD should carefully assess target level of influence, ownership and
risk sharing for each partnership type and opportunity

Selected Types of Strategic Partnerships

Strategic Partnerships Acquisitions

JVs
Full mergers
Minority equity stake –
Exclusive agreement, e.g. operational influence
distribution

R&D partnerships Joint marketing, incl. co-

branding
Increasing
Strategic
Level of outsourcing
Joint sales planning and
execution
Influence
Exclusive
Supply contract

Long-term cooperation
agreement, e.g.
distribution

One-off
arms-length Minority equity stake -
transactions financial only

No Shared Resources
or Equity; Limited
Shared Risk
Source: A.T. Kearney
Shared Resources, No Equity Equity Investment Shared Equity Owned Equity,
Own Assets,
Absorb Full Risk
Increasing Ownership &
Shared Risk/Outcome
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A formalized partnership program will help CKAD to attract the best partners,
facilitate negotiations and ensure desired benefits for CKAD
Dimensions Potential Negotiation Levers Partnership Program
Objectives
Mobile Provision: Subscription Fee, Usage/Transaction
Charge, Platform
Revenue Services: SW License fee, Integration/
Maintenance/Transaction fee Attract the Best
Sharing
Hardware and software: Terminal, Hardware, Software, SIM Partners
card
Commercial
Application cost: Development, Integration, Technical support
Terms
Infrastructure/Platform: Terminal, Server and other H/W,
Bandwidth
Cost Sharing Customer Service/Management: Call Center, Customer Clarify Partner
management and analytics, Billing & settlement, Training Opportunities
Marketing: Marketing/Promotion, Selling cost

Payment Terms Payment Settlement schedule, Payment Collection Charge Facilitate

Sales support: Co-selling, Selling plan, Customer data access,
Negotiation
Joint Sales & Customer care With Partners
Marketing Marketing support: ZMCC Logo, Co-branding,
Non Marketing/Promotion, Marketing plan
Commercial Technical Technical support: Training, Joint-development, Help desk,
Terms Technical documents/specs Ensure CKAD
Support
Benefits
Partnership Partnership management: Dedicated partnership
manager/team, Exclusive, Contract period, Partnership process,
Management Partner list

Source: A.T. Kearney analysis 4-8

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4. Strategic Partnerships
• Partnership Blue Print –
Application Service Providers
• Partnership Blue Print –
System Integrators
• Case Study – AT&T Wireless
Alliance Program
• Short-listed ASP and Systems
Integrator Partners for CKAD

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Partnerships have significant advantages to both CKAD and the ASP
Advantages
Disadvantages
Source: A.T. Kearney analysis
CKAD
• Leverage ASPs as providers and developers
of horizontal and vertical applications
• Enhance ZMCC’s one-stop solution provider
position
• Assist KAMs in understanding and selling
advanced applications
• Access the client base of leading ASPs
• Performance of partners will have impact on
ZMCC’s brand and reputation
• Resources needed internally for partner
support
• Risks related to investments in unsuccessful
application development
ASP
• Access critical marketing and sales
capabilities – access to CKAD customer
base and network
• Leverage CKAD’s strong reputation and
credibility in the market
• Access additional funding for development
of leading edge applications, e.g. through
selective equity investments by CKAD
• Opportunities lost to build relationship with
China Unicom (and other operators),
assuming an exclusive arrangement with
CKAD
• Loose control of new application
development as priorities are influenced by
CKAD’s product strategy
4 - 10
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The type of partnership pursued should be defined based on the strength of the
ASP’s capability and the value it brings to ZMCC
Type of Partnerships between ZMCC & ASPs
• Close relationship • Close, long-term
with partner relationship with partner
• Favourable non- • Model includes most
commercial terms to favourable commercial
help the ASP develop terms and highest level of
applications relevant support
Strong
to CKAD’s product • Co-development and
strategy equity share relationship
Selective Strategic should be considered
Partner Capability & Partner Partner
Credibility
• Reputation
• Experience with ZMCC
• Technology Capability
• Local Presence
Basic Premier
Partner Partner
Weak
• Project-based Low High • Close relationship with
relationship Value to ZMCC partner
• Standardized commercial • Application Potential • Favourable non-
terms • Fit with CKAD Strategy
commercial terms to
• Very limited non- enable rapid go-to market
commercial support of the ASPs products

Source: A.T. Kearney analysis

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Different commercial and non-commercial terms should be applied to different

types of partners
Dimension Strategic Premier Selective Primary
Partner Partner Partner Partner

1. Revenue sharing  () ()

Commercial
Terms 2. Cost sharing  () 

3. Favorable Payment Terms  () ()

4. Joint Sales & Marketing   () ()

Non-Commercial 5. Technical Support    

Terms
6. CKAD Partnership
  
Management

Arrangements for each partner type is

detailed in the following pages
Source: A.T. Kearney analysis 4 - 12
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ASP partnership blueprint – Strategic partner

Dimension Strategic Partner Terms

Strategic
Partner Revenue • Highest percentage of mobile usage revenue sharing
Sharing • Highest discount to 50% on SMS pricing
Elements
• Highest discount for SIM card
Costs Sharing • Highest percentage of development cost sharing
Element • Co-development and equity share could be taken
• Free or least payment collection charge
Payment Terms • Same revenue split w/ and w/o bad debt on SMS
Elements • Payment upon receipt invoice from ASP
• Co-selling
Joint Sales & • Joint marketing/ promotion plan
Marketing • Allow Co-branding
• Allow ZMCC logo use
• Highest level of technical support
Technical • ZMCC technical documents/specs sharing
Support • Free technical training for Partners
• Joint development

CKAD
• Dedicated key account manager for partners
• Customer information access
Partnership • Exclusive terms(?)
Management • Max of 2 years contract
Source: A.T. Kearney
4 - 13
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ASP partnership blueprint – Premier partner

Dimension Premier Partner Terms

• No or little percentage of mobile Usage revenue sharing
Revenue • Discount on SMS pricing is given depending on real
Sharing traffic
• Purchasing of application should be taken into
Premier Elements
consideration
Partner
• Less than 50% discount for SIM card
Costs Sharing • Less than 50% of development cost sharing
Element • Customer service cost sharing

• Standard payment collection charge

Payment Terms • Higher percentage revenue sharing for ZMCC w/ bad debt
Elements • faster payment settlement schedule

• Co-selling
• Allow joint-marketing
Joint Sales & • Marketing cost sharing
Marketing • No co-branding
• Strictly ZMCC logo use

Technical • Higher priority technical support

Support • Technical documents/spec sharing

CKAD • Exclusive terms should be considered

Partnership • Dedicated key account manager
• Max of 1 year contract
Management
Source: A.T. Kearney
4 - 14
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ASP partnership blueprint – Selective partner

Dimension Selective Partner Terms

Selective
Partner Revenue • Revenue sharing could be considered
Sharing • No or less SMS pricing discount
Elements • other revenue terms are standard
• Less than 50% SIM card discount
Costs Sharing • Development cost sharing
Element • Highest percentage of customer service cost bearing from
ZMCC
• Standard payment collection charge
Payment Terms • Same revenue split w/ and w/o debt on SMS
Elements • Faster payment settlement schedule

• Co-selling
•Allow joint-marketing
Joint Sales & • Marketing cost sharing
Marketing • Selectively co-branding
• Strictly ZMCC logo use

• Higher priority technical support

Technical • Share ZMCC technical documents/specs
Support • Free technical training

CKAD • allow access to customers profile

Partnership • Exclusive terms
• Max of 1 year contract
Management

Source: A.T. Kearney 4 - 15

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ASP partnership blueprint – Basic partner

Dimension Basic Partner Terms

• No revenue sharing program
Revenue Sharing • SMS pricing discount allowed being considered
Elements
Basic
Partner • No SIM card discount
Costs Sharing • No development cost sharing
Element

• Standard payment collection charge

Payment Terms • Regular payment schedule
Elements • Higher percentage revenue sharing split for ZMCC w/bad
debt

• No co-branding offer
Marketing • No ZMCC logo use
Support Terms

Technical • ZMCC technical documents/specs access

support Terms • Normal technical support

Customers • Exclusive terms

management and • Less than half a year contract period
other terms

Source: A.T. Kearney 4 - 16

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A partnership between CKAD and ASP has several benefits to the customer,
including product customization, quality, cost and service

Key Benefits for CKAD’s Customer

Product/ A combination of ZMCC’s wireless expertise and partner’s technical

Application background will help understand client issue and create customized
Customization application

Quality & A partnership between CKAD and the application developer will ensure
Reliability quality and reliability of application and service

The initial cost for buying application/software could be reduced if there

Cost Saving
is a usage revenue sharing terms between ZMCC and partner

Superior A partnership will ensure reliable and continuous access to after sales
Service service, e.g. in maintenance

Source: A.T. Kearney 4 - 17

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4. Strategic Partnerships
• Partnership Blue Print –
Application Service Providers
• Partnership Blue Print –
System Integrators
• Case Study – AT&T Wireless
Alliance Program
• Short-listed ASP and Systems
Integrator Partners for CKAD

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Partnerships with system integrators allows CKAD to effectively deliver
enterprise solutions, while bringing significant benefits to systems integrators
CKAD
Advantages • Leverage partners for vertical solutions that
must be tailored to industry or customer
specific business / organizational
requirements
• Leverage the expertise and experience of a
leading Systems Integrator to sell, implement
and maintain enterprise solutions - no need to
develop in-house capabilities
• Leverage the System Integrator’s customer
base to strengthen/build relationships
• Bring credibility to fixed line offering, e.g.
through co-branding
Disadvantages • Implementation outcomes and thus customer
satisfaction relies heavily on the System
Integrator’s capability
• Possibility of lost intellectual capital due to
the inherent risk of non-exclusive partnerships
Source: A.T. Kearney
Systems Integrator
• Growth opportunity with limited investment
in up-front sales, as this is mainly handled
through referrals from CKAD’s Key
Account Managers
• Leverage CKAD’s customer base and
expertise to strengthen/build new customer
relationships
• Opportunity to leverage the CKAD brand
through joint efforts in marketing and sales
• Investment of time an resources in
understanding specific wireless enterprise
solution
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CKAD should establish two types of partnerships with system integrators -
Strategic Partners and Outsourcing Partners
CKAD Partnership Hierarchy – Systems Integrators
• Nature of Relationship. The
nature of the Strategic Partner
status is strategic and involves
close collaboration in areas
ranging from joint sales
execution to dedicated CKAD
partnership management
• Target Structure. CKAD
should establish relationships
with 3-4 Strategic Partners,
CKAD
Typically larger and well
reputed Systems Integrators
that cover a range of industries
• Key Benefit to CKAD. From
CKAD’s perspective, the
Strategic Partners bring
capabilities for
implementation of complex
enterprise solutions and, in
addition, boosts CKAD
credibility in sales and
marketing
Source: A.T. Kearney
• Nature of Relationship.
The nature of the
Outsourcing Partner status
is largely transaction based,
but with some collaboration
with CKAD in marketing
• Target Structure. CKAD
should establish
relationships with 10-15
Strategic Outsourcing Partners.
Partner Typically, smaller Systems
Outsourcing Integrators with specialized
Partner knowledge in an industry or
a particular product area
• Key Benefit to CKAD. The
Outsourcing Partners bring
strong systems integration
capabilities for
implementation of less
complex enterprise solutions
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Strategic Partners cooperate with CKAD in both sales and marketing, while
Outsourcing Partners take the role of sub-contractors

Dimension Strategic Partner Outsourcing Partner

1. Joint Sales Execution 

2. Outsourcing

Arrangement

3. Joint Marketing  ()

4. Joint Sales Planning 

5. CKAD Partnership

Management

Source: A.T. Kearney 4 - 21

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Strategic partnerships will include cooperation across both sales & marketing – a
joint interface towards the customer

Systems Integrator Partnership Blueprint – Strategic Partners

• Joint Sales Execution. The Systems
Integrator is participating in
Joint Marketing
negotiating the sale. The customer
& Sales Planning
will eventually pay the System
Implementation
& Usage Fees Integration fees directly to the
Systems Integrator
CKAD • Joint Marketing. Cooperation may
CKAD Partnership Customer
Sales include:
Management
Execution - Opportunity to co-brand an offer
- Right to use CKAD partnership
logo
- Participate in advertising
- Participate in promotion event
- Joint or individual press release
Sales Execution
Systems - Marketing collateral development
Integrator
• Joint Sales Planning. CKAD and the
Integration & Systems Integrator develop joint
Maintenance Fees plans for business development
• ZMCC Partnership Mgmt.
Dedicated CKAD management of the
partnership
Source: A.T. Kearney 4 - 22
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In outsourcing partnerships, CKAD owns and controls the customer interface

Systems Integrator Partnership Blueprint – Outsourcing Partners

• Outsourcing Arrangement. CKAD
negotiates and pays fees to the
Joint
Systems Integrator based on an
Marketing
Implementation outsourcing arrangement. Thus, the
& Usage Fees Systems Integrator will take the role
of a sub-contractor in
CKAD Enterprise Customer • Joint Marketing. Cooperation may
Systems Solution Sales include:
Integration & Execution - Participate in advertising
maintenance
- Participate in promotion event
Fees
- Marketing collateral development
• Joint Sales Planning. CKAD and
the Systems Integrator develop joint
Systems plans for business development
Integrator • CKAD Partnership Mgmt.
Dedicated CKAD management of
the partnership

Source: A.T. Kearney

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A partnership between CKAD and Systems Integrators has several benefits to the
customer, including improved service quality, convenience and cost

Key Benefits for CKAD’s Customer

High Quality & A track record of cooperation between CKAD and the Systems
Reliability Integrator will ensure quality and reliability of services

A partnership between CKAD and the Systems Integrator will

Convenience in
facilitate the purchasing process, providing a one-stop-shop
Purchasing
solution for the customer

A track record of cooperation between CKAD and the Systems

Cost Effective
Integrator will ensure the most cost effective provisioning of
Implementation
services

Superior A partnership will ensure reliable and continuous access to after

Service sales service, e.g. in maintenance

Source: A.T. Kearney 4 - 24

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4. Strategic Partnerships
• Partnership Blue Print –
Application Service Providers
• Partnership Blue Print –
System Integrators
• Case Study – AT&T Wireless
Alliance Program
• Short-listed ASP and Systems
Integrator Partners for CKAD

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Case Study – AT&T Wireless has established an alliance program for software
providers, equipment manufacturers, consultants & system integrators

In order to work closely with its partners in AT&T Marketing Alliance Homepage
implementing its business solutions, AT&T
wireless launched a comprehensive
marketing alliance program.
There are three types of partner identified
by AT&T wireless:
Software providers:
Leading vendors of software products that
enable wireless access to mobile content.
Equipment manufacturers:
Leading vendors of AT&T Wireless
certified devices that provide connectivity
to the AT&T Wireless Network.
Consultants and systems integrators:
Leading providers of management
consulting and systems integration
services for the integration of AT&T
Wireless services with existing systems,
optimization of business processes, and
strategic business objectives

Source: AT&T, A.T.Kearney analysis 4 - 26

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Case Study – AT&T has defined a three tiers alliance structure for software
providers and set up strict requirements for each type …
Select Alliance
Characteristics • Independent software
companies
• Services utilizing the general
GSM/GPRS network and rate
plans
• Potential integration with
AT&T wireless platforms and
API
Requirements • Solution need to be certified
through AT&T wireless
• Certification must be
completed within 180 days
• Program fee $ 5,000
• Designated alliance manager
• At least one new AT&T
wireless customer generated
per year
Source: AT&T, A.T. Kearney analysis
Premier Alliance
• Software providers that have
AT&T certified solutions for use
on AT&T wireless network
• Interested in an upgraded
relationship
• Designated alliance manager to
work with AT&T in developing
and executing business plans
• required to participate in a
review of their application with
AT&T to provide technical
information for AT&T use
• Committed to $100,000
marketing spending per year for
certified solution
• At least 5 new AT&T wireless
customer generated per year
Strategic Alliance
• Market leading application
vendors
• Want to go-to-market in a
comprehensive manner
• Designed alliance manger to
work with AT&T to develop a
go-to-market strategy aimed at
generating customer success
stories and achieving sales goals
• Committed to $500,00 marketing
spending per year for certified
solution
• At least 10 new AT&T wireless
customer generated per year
4 - 27
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… and commits to different degrees of support for each alliance type
Dimensions Select Alliance Benefits
Sales • Single point of contact
Marketing • Marketing&promotion support
Technical • Free standard access
• Access to developer program
• Technical service available
• Development of Custom solution
support
Training and • Access to all AT&T wireless alliance
others training course
• ‘Billing on behalf of’ service
Source: AT&T, A.T. Kearney analysis
Premier Alliance Benefits
• Joint sales plan
• Help with pre and post sales
implementation
• Joint marketing and business
plan
• Free standard access
• Access to developer program
• Additional technical service
• Access to AT&T wireless
alliance training course
• ‘Billing on behalf of’ service
• Collateral on Certified Solutions
circulated to AT&T sales force
Strategic Alliance Benefits
• Dedicated alliance manager to
develop go-to-market strategy
• Generate customer success
stories
• Invited to develop a co-branded
offer
• Joint marketing and business
plan
• Free standard access
• Access to developer program
• Additional technical service
• Sales force training
• Billing on behalf of’ service
• Collateral on Certified Solutions
circulated to AT&T sales force
4 - 28
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Case Study – AT&T has defined a three tiers alliance structure for system
integrators and set up strict requirements for each type
Select Alliance
Characteristics • Primarily system integrators
who are experts in the
installation of wireless solutions
or providers of consulting
service
• Typically focused on small and
medium-sized companies
Requirements • Maintain a small base of
consulting professionals that
are truly trained on AT&T
wireless enterprise solutions
• At least one new AT&T
wireless customer must be
generated per year
Source: AT&T, A.T. Kearney analysis
Premier Alliance
• Larger consulting firms that
have demonstrated an ability to
provide integration service
• Broad industry knowledge
• Interested in an upgraded
relationship with AT&T
• Designed alliance manager
with AT&T wireless in
developing and executing
against a business plan
• Required to participate in a
review of their wireless
implementation methodology
and architecture with AT&T
• Maintain a medium-sized base
of consulting team
• Committed to $100,000
marketing spending per year
for their wireless practice
Strategic Alliance
• Large consulting firms who
have demonstrated their ability
to provide wireless integration
services with broad industry
knowledge
• Want to go-to-market with
AT&T in a comprehensive
manner
• Designed alliance manger to
work with AT&T to develop a
go-to-market strategy aimed at
generating customer success
stories and achieving sales
goals
• Committed to $500,00
marketing spending per year
• Maintain a dedicated team
• At least 10 new AT&T
wireless customer generated
per year
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Case Study – AT&T Wireless has committed to different degrees of support for
each alliance type
Dimensions Select Alliance Benefits
Sales • Alliance manager assigned
• List in AT&T marketing collateral
Marketing • Eligible to use AT&T wireless logo
for marketing
Technical • Access to developer program
• 5 technical support
Training and others • Alliance billing service
• Access to web training program
Source: AT&T, A.T. Kearney analysis
Premier Alliance Benefits
• Dedicated alliance manager
• Alliance sales planning
• Listed in AT&T customer
presentation
• Joint marketing and business
plan
• Inclusion in AT&T wireless
business link
• Right to use AT&T logo
• Access to developer program
• 15 technical support
• Training on AT&T wireless
products and services
Strategic Alliance Benefits
• Dedicated alliance manager
• Alliance business planning
• Joint selling with AT&T
• Joint marketing and business
plan
• Opportunity to co-brand an offer
• Right to use AT&T logo
• Access to developer program
• Access to AT&T wireless
solution creation lab
• AT&T sales force training
• Alliance billing serivice
4 - 30
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Case Study – In order to support its partners, alliance services are tailored to
each alliance type to provide value to the partners in a tailored manner

AT&T Wireless Developer Program Center

Technical services
• AT&T Wireless developers program
The developers program serves as the central resource
for all technical issues and questions for alliance
members

• AT&T Solution certification

The AT&T wireless solution certification handbook,
available through the developers program, describers the
requirements for certification
Tech
• Technical support Tips
The alliance member receives a grant of support calls
per year based on alliance type and level

Training service
• Web-based training is available through the developers
program, including: Java application guide, Developers
gateway, 3G network simulator tool, Guide to mMode-
compliant iHTML Coding and etc
Technical resource

Source: AT&T, A.T.Kearney analysis 4 - 31

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Case Study – In order to support its partners, alliance services are tailored to
each alliance type to provide value to the partners in a tailored manner
(continued)

Co-marketing services Sales

• AT&T Wireless certified solutions logo • Sales planning

AT&T wireless certified solutions guideline is AT&T alliance manager will use the Business plan to
available in the web-site coordinate sales activities as appropriate for alliance type

• AT&T Wireless alliance and certified
solution directory
AT&T Wireless will list alliance member information
and certified solution in the alliance directory located in
AT&T wireless web-site
• AT&T Wireless Sales Force Training
and communication
AT&T alliance will work with alliance in developing a
specific customer presentation during joint sales calls

• Marketing for certified solutions

Alliance members must commit to marketing the
certified solution, and AT&T Wireless will be
prominently displayed in marketing activities

• Marketing Collateral
AT&T alliance manager will assist the alliance member
in creating or updating collateral for sue by sales force

Source: AT&T, A.T.Kearney analysis

4 - 32
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4. Strategic Partnerships
• Partnership Blue Print –
Application Service Providers
• Partnership Blue Print –
System Integrators
• Case Study – AT&T Wireless
Alliance Program
• Short-listed ASP and Systems
Integrator Partners for CKAD

4 - 33
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We have developed a long list of ASP and SI partners based on A.T. Kearney’s
internal database, interviews with industry practitioners and desktop research

• Database for the partner list includes Existing

– Around 300 current CMCC partners CMCC’S
– List of Service Providers for enterprise Partner List
solution development that have met with
CMCC
– Companies with CMCC partnership
experience Existing
• In addition, our existing database includes Kearney’s
more than 10,000 registered ICP/ASP in Database
Beijing and Shanghai, and around 1,000
Develop
system integrators and software company
Partner List
list
• Research reports and web searches were
used to identify leading application Desktop
developers and systems integrators research
• Interviews with:
– Leading ASPs including Linktone,
Sincetimes, Peakmobile
Industry
– Venture capitalist
Interview
– Overseas ASP employee

4 - 34
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We have applied a rigorous process for identifying, screening and evaluating

potential partnerships

Partner Selection & Prioritization Process

Develop/Revise
Develop Define Selection Select Partner
Partner
Partner Long List Criteria & Scoring Candidates
Prioritization Tool

• Developed partner long • Defined screening • Developed partner • Finalized database

list based on A.T. criteria based on A.T.
Kearney internal Kearney’s previous
database and research project experience and
on the China market relevant industry
• Conducted interviews considerations • Tool allows for
with industry experts • Developed
and venture capitalists prioritisation criteria
to ensure up to date and developed for ranking
accurate information, partners across
including all key players categories
for each category • Established scoring
system for each
prioritisation criteria
selection tool, with over 100
model based on application
Microsoft Excel developers and 60
spreadsheet system integrators in
the long list
sorting of partners • Based on out
using weighted understanding of the
criteria scoring market, partners were
– By service scored and ranked
category • Profile was set up for
key partner candidate
– By industry

Source: A.T. Kearney 4 - 35

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ASP partners are assessed across four groups of criteria – market presence,
company stability, technology capability and industry focus

Market Company Technology Industry

Presence stability
• Is the candidate a leader • How long has the
in the market? company been in
business?
• How is the candidate’s
corporate reputation? • Does the company have a
sufficient level of
• Does the candidate have a financial support
presence in Zhejiang
market? • Is the candidate
generating a high level of
revenue for services
provided
capability focus
• Is the candidate fully web • Does the client have a
enabled? solid relationship?
• Does the candidate has • Does the company have
good track record and some existing
experience? relationship within
industry?
• Does the candidate has a
strong technology team? • Is the company strong in
any industry?
• Does the company has
marketing capability?

Weighting / Relative Importance (Total 100%)

Source: A.T. Kearney 4 - 36

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Specific sub-criteria and a scoring scheme have been defined to enable screening
and selection

Scorning Scheme
Sub-criteria
1 2 3
Well-known nationwide/current CMCC
Market Presence

Brand awareness Little or No Brand Awareness Well-known at the provincial level

Partner

Zhejiang market
Not Presence in Zhejiang Market Have Partner or Own Office in Zhejiang Local Company
presence
Corporate image /
Little Exposure or Knowledge Neutral Image or Reputation Very Favourable Image or Reputation
reputation
Operating commercially for less Operating commercially for more than 6 Operating commercially for more than
Years in business than 6 months months one year
Company
Stability

Strong financial backing. Investment

Investment by local/global company or
Financial strength No or little financial backing
venture capitalist
from famous local/global company or
venture capitalist
Successful produce/service with strong
Revenue generating No successful service/product so far Little revenue generated
revenue
Strong in certain industry, with moderate Strong relationship in key industry, with
Industry strength No or short client list
client citation long/strong client citation
Industry
Focus

Sound marketing plan with dedicated Clear marketing plan with experience
Market capability Lack marketing capability
marketing people marketing team

No Successful Solution/product So Above One Successful Solution/product Good Track Record With Solid
Track record/experience Far Launched Experience
Technolog
Capability

Strong Application Development Team,

Source: Technology
A.T. Kearney team Less Than 5 People, Lack of More Than 5 People, One or Two People
More Than 10 Technology Team, Most 4 - 37
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A.T. Kearney has compiled the results in a detailed ASP partner database,
including detailed profiles and assessments of 100 candidates

Extract: ASP Partner Database

Vertical
Solution Partner
category characteristics
includes
location, industry
focus

Partner Brief
information information
includes on candidate
company type of
name and business
website

Source: A.T. Kearney Partnership Database 4 - 38

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Shortlists of partners can be generated with a filter tool that sorts by industry
and/or service category

Extract: ASP Partner Database

Filter tool for

composite
ranking
Vertical
Solution
category

Ranking
criteria

Scoring
example

Source: A.T. Kearney Partnership Database 4 - 39

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ASP Partner Candidates – Sample Shortlist

Sample Shortlist of ASP Partners

Search: Rank players by attractiveness and type
of solution provided The largest number of entries in
the database are in mobile
Solution category Company name Location
monitoring & control, tracking
Monitoring&Control 北京闻达尔信息系统集成 Beijing & trading and advertising
Monitoring&Control 森泰克 Beijing
Monitoring&Control 北京映翰通网络技术有限公司 Beijing
Monitoring&Control 醒时世纪 Beijing
Tracking&Tracing 森泰克 Beijing
Tracking&Tracing 招商迪辰 Shenzhen
Tracking&Tracing 思特奇信息技术股份有限公司 Beijing Although an emerging market in China,
Tracking&Tracing Metrowalker Hongkong
Vertical Business 赢思软件技术有限公司 Shanghai we have identify major local players -
Vertical Business 意贝斯特信息技术有限公司 Shanghai most of them have a track record and
Vertical Business Research in Motion Canada
Vertical Business Avantgo U.S.A experience in this field
Vertical Business aether systems U.S.A
Mobile Workforce mgt 赢思软件技术有限公司 Shanghai
Mobile Workforce mgt 意贝斯特信息技术有限公司 Shanghai
Mobile Workforce mgt Peakmobile Beijing
Mobile Workforce mgt Salesforce.com Beijing
Mobile Workforce mgt e.piphany U.S.A Since there are only few qualified
Mobile Workforce mgt aether systems U.S.A local ASPs, ZMCC should consider
Mobile Workforce mgt Extensity U.S.A
Payment&Transaction 黎明公司 Shenzhen partnering with experienced domestic
Payment&Transaction 捷银互动有限公司（Summit） Shanghai developers and leading overseas
Payment&Transaction 724 solutions Canada
Payment&Transaction Mobipay Spanish companies to ensure leadership in
Advertising&polling 灵通网 Shanghai service innovation
Advertising&polling 上海英斯克公司 Shanghai
Advertising&polling Ogilvy Interactive Shanghai

Source: A.T. Kearney Partnership Database 4 - 40

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Partner Profile: CCTK

CCTK’s wireless monitoring system has

Company Basics Highlights been applied to police, utility and
environmental protection industry

• Established in March, 2000.

• Twenty-one branches across
China. Zhejiang branch opened
in 2001
• Aim to be leader in Telecom
Value Added Services area
Multiple
• New utility wireless data LBS
monitoring terminal technology product
has received certification from used in
transportat
the Ministry of Utility
ion
• Strong financial backing and industry
large coverage in China,
including Zhejiang province

Current Monternet partner and

subsidiary of famous listed
Zhongguancun technology

Source: A.T. Kearney Partnership Database 4 - 41

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SI partners are assessed across four groups of criteria – market presence,

company stability, systems integration and industry focus

Market Integration Industry Client

Presence Capability Focus Relationship
• Does the candidate • Does the candidate • Does the candidate • How may clients does
have business in have experience in the have focused the candidate have?
Zhejiang? wireless system industry?
integration? • Is the company strong
• How strong is the • Is the candidate’s in any industry?
candidate’s brand and • What level of System focused industry
reputation? Integrator attractive to ZMCC? • How attractive of the
Certification does the candidate’s client to
• What is the • How strong is the ZMCC?
candidate have?
candidate’s position in candidate’s position in
the National Top100 their focused industry?
System Integrator
Ranking?

Weighting / Relative Importance (Total 100%)

Source: A.T. Kearney 4 - 42

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Specific sub-criteria and a scoring scheme have been defined to enable screening
and selection

Scoring Scheme
Sub-criteria
1 2 3
There Are Branches in Zhejiang
Currently No Business in
Zhejiang Presence Zhejiang
or Having Cooperation With Zhejiang Local Company
Presence
Market

Zhejiang Company

Well Known and Ranked

Little Brand Awareness in In the Top 100 System Integrators
Corporate reputation System Integration Area List, but Not Well Know
Top 10 in the Nationwide
Top 100 System Integrator

Having Experience but No Track

Record of Wireless System Having Been Cooperated
No Experience in the Wireless
Track Record Integration in China; Or Have With Operator to Do
Integration
Capability

Area
Potential to Do Wireless System Wireless System Integration
Integration

Below Level II in the System Level II of System Integrator Level I of System Integrator
Integration Team Integrator Certification Certification Certification
Client Relationship

Few Zhejiang company in the
Industry Focus client pool
The industry focus is weak or the
focused industry is not attractive
to ZMCC
Zhejiang client but not attractive
to ZMCC
The industry focus is attract to
ZMCC but the candidate’s
position is not strong
Attractive client pool to
ZMCC
Leader of the focused
industry and the industry is
just attractive to ZMCC

Source: A.T. Kearney 4 - 43

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A.T. Kearney has compiled the results in a detailed SI partner database,

including detailed profiles and assessments of 60 candidates
Ranking criteria, including Market
presence, Integration capability,
Extract: ASP Partner Database Partner Characteristics industry focus and client relationship

No. and
Company’s
name

Company’s Weighting
Location

Company’s SI
certification

Composite
Rank
Ranking in the
Top 100 SI
Industry focus

Source: A.T. Kearney Partnership Database Zhejiang Presence 4 - 44

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SI Partner Candidates – Sample Shortlist

Sample Shortlist of SI Partners

Rank Company
1 IBM
• Ranked high in the Top 100 system integrators
2 HP
• Have track record in the wireless system integration
3 联想神州数码有限公司 area except AsiaInfo
4 东软集团 ( 东大阿尔派 ) • Have branches in Zhejiang or cooperation with
Zhejiang companies
5 亚信科技（中国）有限公司
6 北京北大青鸟商用信息系统有限公司
7
北京方正奥德计算机系统有限公司
8 Zhejiang local company with strong
industry focus and client pool
9
北京合力金桥系统集成技术有限责任公司
10
浙江大学快威科技集团有限公司
11
12 杭州恒生电子股份有限公司
13 杭州信雅达系统工程股份有限公司
Small companies, but with focus on
14 wireless solutions and systems integration
上海三吉电子工程有限公司
15
北京闻达尔信息系统集成有限责任公司
16
北京节点通网络技术有限公司
Source: A.T.清华深讯科技发展有限公司
Kearney Partnership Database 4 - 45
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Partner Profile: WIRE

Strong Local Reputation & Capabilities

• Level I certification System Integrator
• Ranked 53 in the national Top 100 System
Integrators
• Ranked 16 in the Top 100 IT company in the
E-government area
• Top 10 Zhejiang software company Broad range of system integration solutions

Partnership and Local Client Base Solution Sub Segment Industry

• Closely aligned with international leaders Broad band Web based video solution Various industries
application
- IBM strategic alliance in China solution E-government solution Government
- CISCO gold agency
- Oracle partner E-learning solution Large Corps; Education
• Strong client base in Zhejiang Enterprise EDP solution Distribution companies
- Electricity: Zhejiang electronic bureau; North application
solution Sales management solution Enterprises
China electronic bureau, etc
- Government: Zhejiang Police Bureau;
Government Easy E-government Government
Zhejiang provincial office; Zhejiang
application solution
commerce bureau, etc solution
- Enterprise: Zhejiang airline corps. Xiaoshan
airport, etc … … …

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BACK UP

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Issues to be addressed

 How large share of an enterprise solution sale comes from SI revenues?

 Are SI and operators competitors?
 Is maintenance service normally included in an SI contract? Or is it charged separately as
needed?
 Talk to Key Account Mgr to understand how they would prefer to sell a complex ES (who
pays who what, SI and CKAD) – why?
 Check payment arrangement – are our assumptions sensible?
 Check Optus

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Different type of partnership will be introduced depending on the following two

dimensions

I:
H IV I Solution example : Mobile workforce
ZMCC + ZMCC + SI + management; Monitoring control
Application application Partner: independent SI with industry
developer developer expertise need to be introduced
Degree of integration with

Or ZMCC + Or ZMCC +
application application II:
developer + SI developer Solution example: Tracking& Tracing
legacy system

Partner: application developer generally do

system integration work themselves, but niche
SI would be involved in certain case

III:
II Solution example: SMS-based service
III
ZMCC + Partner: application developer could do system
ZMCC +
application integration themselves
application
developer
developer
Or ZMCC + SI
IV:
Solution example: mobile-office
L Partner: application developer in this area are
L H generally solution provider, but local SI might
be involved in certain case
Industry/customer specific needs

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ZMCC should focus on factors which are important for application developers
for their partnering with ZMCC

1 • Clear revenue sharing model

Revenue sharing model
• Revenue sharing from ZMCC for high-cost
application development

2 • Co-brand, authority for using ZMCC logo

Marketing/selling support
• Co-selling with ZMCC

3 • Simplified partnership process

Service level agreement
• Guaranteed network and other service quality

4 • Single contact of window

Good work relationship
• long-term/strategic relationship commitment

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As one application reach different states of maturity, ZMCC should shift its
partnership focus as well

H
Mature
Stage
• Seek strategic
Development
partner
Stage
Maturity of market

• Enforce
Incubator qualification
• Selectively seek
stage • Refine business term
partner
s
• Open/transparent
• Actively • in favor of ZMCC
relationship
seek/cultivate partner • Non-commerical
• Provide assistance
• Provide favourable terms are much
in key areas
commercial terms for more applicable
potential partners • Refine business
terms to share risks
• Provide assistance at
all levels
L
Short-term Long-term
Time

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Critical issues in negotiation with application developers

 Mobile usage revenue sharing should be addressed only to

1. Strategic partner
2. New application with no clear prediction on usage
3. Project involve long-term maintenance and follow-up service
 Development cost sharing should be addressed only to:
1. Strategic or Premier partners
2. Potential high- value application in incubator stage
 Service cost sharing might occur when:
Client is critical to ZMCC
 Co-branding could be applicable only when:
1. Strategic partner
2. Selective partner

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A further alliance model with leading application developers should be

considered by ZMCC in the future in order to enhance its leadership position in
providing innovative corporate solution and acquiring high application margin
 Informal business relationship  Managerial partnership  Partnership Joint Venture
Legal and • Contract, no separate legal entity • Same as informal business • Separate legal entity in the form of
financial • Resources given by each party relationship a partnership
concept • Contract on branding and how to • Separate dedicated management • Separate P&L statement
use outputs team • Distribution of profit/loss can be
• Commercialisation in parent decided every year independent
companies from ownership structure
 ZMCC might own final product

Dedicated
Entities Management J
structure Joint Resources
Joint Resources
V

Partner  ZMCC Partner ZMCC Partner ZMCC

Pro: • Easy to establish & easy to close • Easy to establish & easy to close • Dedicated resources allow
• Theoretical flexible • Theoretical flexible commitments in service delivery
• Higher commitment from both • IPR's issue does only need to be
companies resolved between partners once

Contra: • Arrangement need to be • Arrangements need to be • Higher risk & higher cost
negotiated for every application negotiated for every application • Market (other operation)
• Resource availability cannot be • Resource availability might still perception would be negative
guaranteed be a problem

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Different partnership model should be developed for each level of partners

Partnership Level
Dimension
Preliminary Primary Strategy
A. Commercial Arrangement
• Revenue sharing elements, e.g:
- Integration
- Maintenance
- Continued wireless usage
• Cost sharing elements, e.g:
- Integration
- Customer service
B. Non-Commercial Arrangement
• Partnership manager assigned
• Partnership business planning
• Right to use ZMCC partnership logo
• Opportunity to co-brand an offer
• Participate in Advertising
• Participate in marketing promotion Event
• Joint or individual press release
• Marketing collateral development
• Joint selling with ZMCC’s KAMs

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Different partnership model should be developed for each level of partners

Strategic Primary Preliminary

Commercial
Revenue share:
- Integration service charge Customer+ZMCC pay to SI Customer+ZMCC pay to SI Customer pay to SI
- Maintenance service charge Customer+ZMCC pay to SI Customer pay to SI Customer pay to SI

- Continued wireless usage fees Customer pay to ZMCC, Customer pay to ZMCC, Customer pay to ZMCC, no
further share with SI further share with SI further share with SI
Cost share:
- Integration cost SI+ZMCC undertake SI undertake SI undertake
SI+ZMCC undertake ZMCC+SI undertake SI undertake
- Customer service cost

Non-commercial
- Co-Brand an offer  N/A N/A
- Right to use ZMCC partnership   
Logo
• .
- Participate in advertising
  N/A
- Joint selling with ZMCC’s
  N/A
KAM
  
- Technology support
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