ChinaCache International Holdings Ltd. Issues Letter to Shareholders
BEIJING, April 29, 2013 (GLOBE NEWSWIRE) -- ChinaCache International Holdings
Ltd. ("ChinaCache" or the "Company") (Nasdaq:CCIH), the leading total
solutions provider of Internet content and application delivery services in
China, today issued a letter to the Company's shareholders from Mr. Song Wang,
Founder, Chairman and Chief Executive Officer of ChinaCache. In the letter,
Mr. Wang commented on ChinaCache's 2012 full year performance, key trends in
its target markets and the Company's outlook for 2013.
2012 was a year of strategic repositioning and progress for ChinaCache. Thanks
to our high-quality customer wins, our annual revenue grew more than 30% to a
record RMB 813.7 million, our gross margin increased 120 basis points over
2011 to 31.2%, while our overall customer count grew more than 63% in 2012 to
1,265, compared with 775 at the end of 2011.
This focus on sustainable, high-quality customers and comprehensive,
value-added solutions has helped change the way ChinaCache is perceived within
the industry, both in China and abroad. We are building upon our leadership
position in the CDN space and introducing new services to meet the needs of
customers in multiple segments.
We entered 2013 well positioned for a year of growth and success as a result
of favorable trends in China's Internet industry and our targeted end markets,
as well as a series of strategic initiatives we undertook throughout last year
that are having a lasting, positive effect on our business.
With that, I would like to share with you some of the highlights of 2012 and
how they position ChinaCache for future growth.
In the third quarter of 2012, we initiated the strategic reorganization of our
sales force. During this process, we took steps to re-align our sales team to
better support our strategy of pursuing higher quality revenue opportunities.
We now have four sales units, including teams focused on Internet companies,
enterprises and telecom operators, and a fourth team that is targeting small
to medium customers and government agencies. This structure enables us to
deliver solutions and products designed specifically for the distinct needs of
each vertical, and I am pleased with the progress we have made as well as the
initial results of this transition.
As a result of these initiatives, we won business with a number of renowned
companies including China Eastern Airlines, Air China, Hainan Airlines and Air
France, financial institutions such as China Everbright Bank and China
UnionPay, leading Android app store gfan.com and global brands such as Cartier
and Hermes, just to name a few. I believe that these high-profile customer
wins clearly demonstrate the strength and potential of our new
industry-focused sales approach.
Looking at the industry in which ChinaCache operates, I believe that we are in
the right market, with the right product at the right time. The majority of
the world's population has some way of connecting to the Internet, whether it
is through a desktop PC, mobile handset or other device. The online population
is growing every day, and ChinaCache is poised to benefit from this rapid
According to Gartner estimates, the number of smart phones will grow to 1.8
billion units globally by the end of 2013, surpassing the 1.7 billion PCs in
use to make handsets the world's preeminent Internet devices. In China,
according to iResearch, the number of mobile Internet users will reach 710
million around 2015, surpassing desktop Internet users. There is a tremendous
need to improve the speed, reliability and safety of users' Internet
connections both in China and internationally, and this need is creating a
significant, unmet demand for solutions such as ours.
I believe that we are leveraging our industry-leading technology and R&D
capabilities to capture this large, growing market opportunity for both fixed
line and mobile Internet applications. Since late 2011, we have been
aggressively promoting our proprietary Content-aware Network Services, which
we see as the next phase in the evolution of CDN technology. While legacy CDN
technology was designed to support fixed-line networks with content consumed
mainly on the desktop, we have built upon this core function to create a
solution that is network-aware, device-aware and application-aware, and
capable of optimizing content for any situation.
*Network-aware enables us to determine the type of network through which
specific online content is traveling, whether it is a fixed line or mobile
network, and even whether it is a 2G, 3G or 4G mobile network.
*Our device-aware capabilities allow us to identify each end-user's device
and optimize data accordingly. We determine whether a user is accessing
data on an iOS, Android or other device, and transmit the data in a way
that maximizes user experience on that particular device, without
straining the network.
*Our application-aware technology allows us to provide network services
tailored to specific applications such as e-commerce or online video,
which require different capabilities and resources than static content.
In short, we are able to provide the best end-to-end solutions for our
customers and their end-users regardless of the network, the device or the
application, and we believe this is the right approach to address the needs of
China's rapidly developing Internet market. According to the China Internet
Networks Information Center, the number of Internet users in China reached 538
million by the end of June 2012, increasing 11% in the first half of 2012,
with Internet penetration growing to 39.9%.
Building upon our Content-aware Network Services, we have introduced enhanced
services such as our CC Index platform, which identifies bottlenecks in
Internet networks and provides real-time data as well as a comprehensive
quarterly report on network status and Internet statistics throughout China.
Our Intelligent Traffic Reduction, or ITR technology, helps optimize bandwidth
utilization efficiency, and Cloud Extension Solutions leverages our cloud
computing capabilities to improve end-user experience.
Our business is not only growing in China, but we are also expanding our
international footprint. In 2012, we established a subsidiary in Hong Kong,
which serves the Southeast Asia market alongside our U.S. office and led to
strategic partnerships with Hutchison Global Communications, SmarTone, Telecom
Malaysia and others. With our technology currently covering parts of Asia,
North America, Western Europe, the Middle East and North Africa, we are
positioning ourselves as an international player and serve as a gateway for
companies who do business in China or for Chinese companies who expand
By focusing on execution, with an eye toward developing great technology and
network services, we will continue to enhance Internet quality to benefit more
Internet users.Thanks to our Content-Aware Network Services, which provide
speedy, secure and intelligent mobile and fixed-line Internet solutions, we
believe that we have tremendous opportunities ahead of us and we can create
significant value for our shareholders and partners over the long term.
In 2013, we are celebrating the Company's 15th anniversary. I always believe
that our greatest asset is the people who work for us and I am truly proud of
them. Going forward, we will continue to invest in the future and work to
increase CDN penetration rates in China. We remain confident in our ability to
maintain our leadership in technology, market share and influence in this
industry, and we thank you for your continued support.
Founder, Chairman and Chief Executive Officer
About ChinaCache International Holdings Ltd.
ChinaCache International Holdings Ltd. (Nasdaq:CCIH) is the leading total
solutions provider of Internet content and application delivery services in
China. As a carrier-neutral service provider, ChinaCache's network in China is
interconnected with networks operated by all telecom carriers, major
non-carriers and local Internet service providers. With more than a decade of
experience in developing solutions tailored to China's complex Internet
infrastructure, ChinaCache is a partner of choice for businesses, government
agencies and other enterprises to enhance the reliability and scalability of
online services and applications and improve end-user experience. For more
information on ChinaCache, please visit en.chinacache.com.
Safe Harbor Statement
This announcement, including the letter to the shareholders, contains
forward-looking statements. These statements are made under the "safe harbor"
provisions of the U.S. Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as "will,"
"expects," "anticipates," "future," "intends," "plans," "believes,"
"estimates" and similar statements. ChinaCache may also make written or oral
forward-looking statements in its reports filed or furnished to the U.S.
Securities and Exchange Commission, in its annual reports to shareholders, in
press releases and other written materials and in oral statements made by its
officers, directors or employees to third parties. Statements that are not
historical facts, including statements about ChinaCache's beliefs and
expectations, are forward-looking statements. Forward-looking statements
involve inherent risks and uncertainties. A number of factors could cause
actual results to differ materially from those contained in any
forward-looking statements, including but not limited to the following: the
Company's goals and strategies, expansion plans, the expected growth of the
content and application delivery services market, the Company's expectations
regarding keeping and strengthening our relationships with its customers, and
the general economic and business conditions in the regions where the Company
provides its solutions and services. Further information regarding these and
other risks is included in the Company's filings with the U.S. Securities and
Exchange Commission. All information provided in this press release is as of
the date of this press release, and ChinaCache undertakes no duty to update
such information, except as required under applicable law.
CONTACT: For investor and media inquiries please contact:
Ms. Yujie Li
ChinaCache International Holdings
Tel: +86 (10) 6408 5305
Mr. Lee Roth
The Piacente Group | Investor Relations
Tel: +1 212-481 2050
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