ZTE CEO Xu Ziyang: Convergence and Innovation - Build Phygital DNA for Faster Growth

• ZTE aims to build a Phygital DNA for faster iteration and innovation, ultimately reshaping society as a whole
• ZTE seeks concerted efforts for faster breakthroughs in terms of optimum efficiency, upgraded capability, as well as intelligent and simplified application
• During the MWC Shanghai, ZTE’s CEO Xu Ziyang was granted the Outstanding Contribution to the Asia Mobile Industry Award at GSMA's Asian Mobile Awards (AMO) 2022

Shanghai, China, 28 June 2023 - ZTE Corporation (0763.HK / 000063.SZ), a global leading provider of information and communication technology solutions, announced today that the company's CEO, Xu Ziyang, delivered keynote speeches at the "Digital First Networks" session and the GTI Summit Shanghai. During his speeches, Mr. Xu shared ZTE's insights and practices in this digital era.

During the "Digital First Networks" session, Mr. Xu pointed out that, due to various uncertainties, there may be a limited window of opportunity for the digital transformation of industries. This situation entails greater responsibilities and higher pressure. Against this backdrop, ZTE focuses on key underlying technologies, infrastructure, and applications while promoting the integration of physical and digital realms, convergence of computing and networking, and increased efficiency in production and transactions. By doing so, the company aims to build a Phygital DNA for faster iteration and innovation, ultimately reshaping society as a whole.

At the GTI Summit Shanghai 2023, Mr. Xu highlighted ZTE's insights and practices in the digital industry. According to Mr. Xu, the digital infrastructure in China, especially dual-gigabit networks and computing power, has developed into a mature phase. To seize the opportunities for a leap forward, ZTE seeks concerted efforts for faster breakthroughs in terms of optimum efficiency, upgraded capability, and intelligent and simplified application. As stressed by Mr. Xu, only by pursuing excellence even when tackling the hardest challenges can the company grow stronger with vitality.

During the MWC Shanghai, Mr. Xu was granted the Outstanding Contribution to the Asia Mobile Industry Award at GSMA's Asian Mobile Awards (AMO) 2022. The award recognizes Mr. Xu's outstanding leadership in driving ZTE to continuously promote industrial innovation, enhance cross-industry collaboration, and boost the development of the global mobile industry.

Below is the original text of Xu Ziyang's speech titled "Convergence and Innovation - Build Phygital DNA for Faster Growth":

Currently, the digital infrastructure in China, especially dual-gigabit networks and computing power, has developed into a mature phase. Consumers are shifting from voice and data communications to intelligent and integrated information services tailored to specific scenarios, such as Fiber to the Room (FTTR), intelligent cockpits, virtual-real fusion, and low-altitude economy. In addition, industrial digitalization has entered a crucial stage, with problems emerging from both the demand and supply sides. For example, on the demand side, there are difficulties in service integration, high management costs, and barriers to service innovations. On the supply side, how can we strike a balance between high requirements and low costs, fragmented scenarios and large-scale application, as well as heavy investments and slow monetization? The good news is, driven by such problems, we are finding a way out with technological breakthroughs and collaboration. ICT is iterating at a fast pace, with significant technological innovations occurring frequently, such as 5G-Advanced, 6G, FTTR, 400G OTN, heterogeneous computing, and modern data centers.

This is an era of data explosion, with ubiquitous but distinct requirements for data processing and circulation. As you know, ChatGPT is a heated product that has triggered the AIGC boom globally. Also, challenges are posed in addressing the slowdown of Moore's Law, closing the gap to the Shannon Limit, pursuing green and sustainable growth, and guaranteeing digital security. Against this backdrop, ZTE focuses on key underlying technologies, infrastructure, and applications, and promotes physical-digital integration, Computing and Network Convergence (CNC), and higher efficiency of production and transaction. By doing so, we aim to build phygital DNA for faster iteration and innovation, ultimately reshaping the entire society.

As for key underlying technologies, the top priority is to achieve breakthroughs in terms of chipset, component and material, and algorithm and architecture. They are the foundation of innovation, and decide how far we can go in capability and efficiency improvement, as well as boundary extension and technology integration. In this respect, ZTE is taking firm steps and making consistent efforts, to pursue excellence even when tackling the hardest challenges.

Just like the brain of a human being or the engine of a car, chipsets are one of the most essential underlying technologies, which directly affect the performance, integration, and Power Usage Effectiveness (PUE) of a product. In other major fields such as computing facilities, 5G, data center switches, and terminals, there are higher expectations and requirements. Hence, we have made innovations and breakthroughs by taking various measures. For instance, advanced processes are adopted, and innovations are made in Domain-Specific Architecture (DSA), packaging, and systemic design, to prolong the Moore's Law. Also, we introduce heterogeneous computing to match different scenarios, and therefore enhance performance and efficiency. Moreover, we achieve hardware acceleration based on DPUs and smart NICs, to constantly promote the co-optimization of software and hardware.

Innovations in components and materials, such as new power amplifiers, filters, antenna elements, and heat dissipation design, can also create huge value. Take power amplifiers as an example. Based on ETSI's standard for measuring power consumption, with a 1% increase in power amplifier efficiency, the overall energy efficiency of equipment will rise by 1–2%, which will make possible larger bandwidth and greater transmit power of base stations. With continuous efforts in this field, ZTE has achieved a power amplifier efficiency 8% higher than the industry average. Also, we use flexible, optical backplanes for 32-dimensional Optical Cross-Connects (OXCs) to simplify equipment architecture while greatly enhancing network capacity and performance. To extend the range and reduce the penetration loss of millimeter wave, ZTE has used Reconfigurable Intelligent Surface (RIS), to significantly improve coverage, user experience, and deployment efficiency.

Regarding algorithm and architecture, ZTE's 5G PowerPilot solution enables the energy saving of wireless networks by 35%, and this will reduce the power consumption of a single site to as low as 5 watts in sleep mode. Based on the algorithm for dynamic collaboration between base stations and RIS, our Dynamic RIS solution increases the millimeter wave coverage by 30% and the average downlink rate by six times. What's more, our distributed database solution, GoldenDB, can raise the performance and capacity of databases tenfold, and save 70% of investments via the decoupling of hardware and software.

For infrastructure and capability enhancement, the key lies in the network, computing power, and the convergence of computing and network.

To enhance network performance, ZTE is dedicated to providing groundbreaking products and solutions.

The upgraded UniSite solution integrates lightweight devices such as the UBR series, A+P series, and broadband antennas, making it easy to deploy multi-mode and multi-band sites.

The 5G TSN solution provides deterministic connectivity with "five 9s" availability, guaranteeing a latency of less than 5 milliseconds and a jitter within microseconds in industrial scenarios.

Our SBFD system has increased the uplink throughput to over 1.4 Gbps while reducing the end-to-end latency to 4 milliseconds for a single carrier.

Integrated Sensing and Communication (ISAC) base stations have boosted low-altitude economy and made smart transportation a reality.

Our RedCap technology fulfills the needs of medium- and high-speed IoT scenarios at a lower cost, greatly broadening the application scope of 5G.

The 400G OTN solution enables ultra-long-haul transmission, building the optical infrastructure for China's East-to-West Computing Resource Transfer Project.

The FTTR solution provides a whole-home gigabit-plus broadband experience for every household.

On the way to level-4 autonomous networks, we are using digital twins to create mixed reality experiences and building intent-based networks for human-machine coordination, achieving end-to-end processing within seconds and closed-loop O&M across domains with self-X capabilities.

As for computing power infrastructure, ZTE provides a full range of server and storage products, including general-purpose servers, GPU servers/intelligent computing clusters, liquid-cooled servers, and all-flash and hybrid flash storage products. Cold plate liquid cooling is applied to further reduce power consumption. Indirect evaporative cooling, extreme liquid cooling, and AI-driven management reduce the PUE of our modern data centers to 1.13. With TECS Cloud Foundation (TCF), the distributed precision cloud, computing resources are pulled from cloud, edge, and terminal levels to enable multi-service deployment and on-demand scheduling.

In terms of CNC and CPN, ZTE has developed a one-stop ICT solution integrating edge cloud. It features an IaaS/PaaS cloud technology stack, and supports heterogeneous computing as well as the unified planning, building, and O&M of ICT infrastructure. As such, this solution has provided practical guidance for the evolution from edge computing to computing power networks.

Also, we actively explore computing and network synergy to build a bridge between the application layer and the network layer, so that the network can sense service demands and computing power resources, implement computing power routing, and realize on-demand scheduling across multiple resource pools.

In addition, ZTE is building an orchestration center featuring unified and open APIs. It enables flexible management in multi-vendor and multi-cloud environments, and ensures quality services that integrate "connectivity, computing, and digital capabilities". In this way, we not only unlock new opportunities, but also empower the digital transformation of various industries in an agile and cost-effective manner.

As industrial digitalization accelerates, we see higher production and transaction efficiency.

ZTE keeps working to improve production efficiency for its partners.

In the smart steelmaking plant of Ansteel, our URLLC technology for remote control of machinery has been adopted on overhead cranes, achieving "five 9s" availability, a 100% increase in production efficiency, and a 20% reduction in labor costs.

In the smart factory of Benxi Tool, we have provided AI-powered machine vision, improving quality inspection precision to two microns, and reducing costs by 15%.

AGV-based warehousing and logistics have made flexibility and lean management a reality. For example, we have helped Gree improve the warehouse automation rate to 60%, and shortened the changeover time to less than two days. In the smart factory of JA Solar, AGVs are deployed for the automated distribution of silicon around the clock.

With situational awareness based on digital twins, we have improved the management of onsite personnel and security for Wonfull Petrochemical.

To improve transaction efficiency and convert it into market value, we empower full-process operation with digital technology, that is, to remove information silos, and enable end-to-end data interconnection and intelligent analysis and matching.

Working with China Telecom Sichuan, ZTE has launched the 5G+ intelligent supply chain demonstration project. By integrating the technologies such as automatic sorting, AGVs, and RFID labels, we customized a digital distribution system, which features one-stop purchase, direct-to-store service, industry collaboration, and a streamlined structure. With this system, the delivery efficiency is increased by 50%, and inventory is reduced by 1/3.

At Tianjin Port, we have enabled remote quay control, automated driving of container trucks, 5G intelligent tallying as well as intelligent on-demand stacking, quality grading, and real-time sorting of goods. Through such efforts, the overall operation efficiency is increased by 20%.

Working with China Southern Power Grid, we have connected grid control and detection nodes on a large-scale 5G network and realized high-frequency collection of power consumption data over broadband networks in real time. This solution has not only enabled smart power consumption and electrical safety, but also increased power distribution efficiency by 2.7 times and accelerated access to green energy.

To better adapt to more diversified and fast-evolving scenarios, we have recently released ZTE Digital Nebula 2.0. With a unified architecture and scalable design, this solution can improve adaptability to multiple industries, unlocking greater potential and further enhancing production and transaction efficiency. Finally, it will help various industries achieve data-driven efficiency improvement, build flexibility through cross-domain collaboration, and boost trust based on openness and transparency.

Phygital DNA will ultimately contribute to a more prosperous human society. With a scientific mindset and human-centric spirit, ZTE leverages digital infrastructure and AI to catalyze and boost sustainable growth for good. Specifically,

• By promoting digital inclusion, we help close the digital divide across the globe and ensure a fair distribution of social resources.
• With digital capabilities, we strive to build knowledge graphs for the entire human society, so as to make our cultures stay alive.
• With innovative technologies, we are committed to achieving more balanced, green, and low-carbon development together with global partners.

We firmly believe that human civilization and technology will complement each other and lead us to a better tomorrow.

In such an unprecedented era, we are all witnessing and enabling historic changes. As a digital native company, ZTE is dedicated to full-stack, all-domain, and full-cycle DICT innovations. As a driver of digital economy, we will always adhere to the business philosophy of "Simplicity, Agility, and Openness for Win-Win". Together with operators as well as industry and ecosystem partners, we aim to build a digital and intelligent ecosystem for shared success, and will always play our part in promoting sustainable development.

Thank you.

ABOUT ZTE:

ZTE helps to connect the world with continuous innovation for a better future. The company provides innovative technologies and integrated solutions, its portfolio spans all series of wireless, wireline, devices and professional telecommunications services. Serving over a quarter of the global population, ZTE is dedicated to creating a digital and intelligent ecosystem, and enabling connectivity and trust everywhere. ZTE is listed on both the Hong Kong and Shenzhen Stock Exchanges. www.zte.com.cn/global

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