Core Viewpoint - China Telecom is committed to building a digital China and has made significant progress in its cloud transformation strategy, focusing on artificial intelligence and the development of its Tianyi Cloud platform [1][2]. Group 1: Technological Advancements - China Telecom has established major intelligent computing clusters in Shanghai and Beijing, and launched the world's first commercial intelligent computing Ascend super node in the Greater Bay Area [1]. - The company has achieved breakthroughs in key technologies such as distributed cloud operating systems and server operating systems, and has developed a full-stack cloud platform [1]. - The Tianyi Cloud server operating system CTyunOS has passed national security assessments, receiving a "Level I" security rating [1]. Group 2: Business Growth and Market Position - Tianyi Cloud's revenue has surpassed 100 billion yuan, maintaining a leading market share [2]. - The company has developed a comprehensive cloud product suite and is actively promoting the integration of cloud and AI technologies [2]. - China Telecom has introduced over 50 industry applications across various sectors, including government, industry, and education, and has empowered over 87 million users with smart terminal products [2]. Group 3: Strategic Initiatives - To accelerate the development of Tianyi Cloud, China Telecom is deepening reforms and establishing a cloud company and cloud computing research institute [2]. - The company is enhancing its R&D capabilities by attracting strategic scientists and investors, and optimizing its operational processes to improve customer service [2]. - China Telecom emphasizes an open and collaborative approach, increasing cooperation with partners and clients to build a more open national cloud ecosystem [2]. Group 4: AI and Data Integration - The company aims to create a comprehensive intelligent cloud capability system that integrates computing power, platforms, data, models, and applications [3]. - China Telecom is focused on upgrading its intelligent computing infrastructure and enhancing its data intelligence platform to support high-quality data sets [4]. - The company is committed to providing tailored solutions for diverse customer needs, including high-efficiency intelligent computing services and integrated solutions for domestic computing power and models [5]. Group 5: Security and Governance - China Telecom is developing a comprehensive dynamic protection system for large models to ensure the safety and reliability of artificial intelligence applications [5]. - The company is enhancing its data security measures and establishing a three-tier risk classification system to improve data safety [5]. - A focus on creating a secure development environment is emphasized, with capabilities for code scanning, auditing, and tracing to protect against vulnerabilities [5]. Group 6: Customer-Centric Operations - China Telecom aims to provide agile and specialized operational services, positioning itself as a trusted AI partner for clients [6]. - The company plans to collaborate with clients to optimize data quality and enhance the integration of data, computing power, and algorithms through AI applications [6].

Core Viewpoint - China Telecom aims to build a comprehensive intelligent cloud capability system consisting of "computing power, platform, data, model, and application" to drive innovation in the artificial intelligence industry [1][2]. Group 1: Intelligent Cloud Development - China Telecom has established major intelligent computing clusters in Shanghai and Beijing, and launched the world's first commercial intelligent computing super node in the Greater Bay Area [1]. - The company has developed the first full-size, full-modal, domestically produced trillion-parameter "Star" foundational model system and has taken the lead in open-sourcing among state-owned enterprises [1]. - The "Star Sea" data intelligence platform has formed a high-quality dataset of 10 trillion tokens and has launched over 50 industry applications in sectors such as government, industry, and education, benefiting over 87 million users [1]. Group 2: Financial Performance - In the fiscal year 2024, China Telecom's intelligent revenue reached 8.9 billion yuan, representing a year-on-year growth of 195.7% [1]. - The revenue from Tianyi Cloud in 2024 was 113.9 billion yuan, with a year-on-year increase of 17.1% [1]. Group 3: Future Investment Plans - For 2025, China Telecom plans capital expenditures of 83.6 billion yuan, with a preliminary allocation for computing power investment expected to grow by over 20% year-on-year, with flexibility for adjustments [2]. - The company will enhance its intelligent computing capabilities by integrating "central clusters + edge data centers" and promoting the deep collaboration of computing networks [2]. Group 4: Platform and Service Upgrades - In the IaaS layer, China Telecom will advance intelligent computing construction and strengthen cloud-intelligent integration capabilities [2]. - The company introduced the Triless platform architecture to upgrade computing power scheduling technology and provide a one-stop service for computing power dispatch and AI development [2]. - In the DaaS layer, the "Star Sea" data intelligence platform will be upgraded to integrate proprietary, open-source, and third-party datasets [2]. Group 5: Focus on SaaS Layer - In the SaaS layer, China Telecom will focus on the digital intelligence needs of production, life, and governance, accelerating the large-scale promotion of AI phones and AI cloud computers [3].

Core Insights - China Telecom's Tianyi Cloud revenue has surpassed 100 billion yuan, indicating strong growth and a commitment to embracing artificial intelligence for building an intelligent cloud capability system [1] Group 1: AI Infrastructure and Services - In the IaaS layer, China Telecom plans to advance intelligent computing construction with an integrated AIDC (Artificial Intelligence Data Center) model combining "central cluster + edge DC" [6] - For the PaaS layer, the company will continue to upgrade its intelligent computing platform, offering one-stop computing power scheduling and AI development services [6] - In the DaaS layer, China Telecom aims to enhance its "Xinghai" data intelligence platform, promoting deep integration of proprietary, open-source, and third-party data sets [6] - The MaaS layer will see improvements in the capabilities of the "Xingchen" large model, focusing on complex reasoning and lightweight, low-cost deployment [6] Group 2: AI Market Trends and Challenges - 2023 is highlighted as the year of large-scale AI application, driven by new open-source AI technologies like DeepSeek that lower the barriers for computing power and algorithms [6] - The market is increasingly focusing on data and applications, reflecting a shift in priorities within the AI landscape [6] Group 3: AI Security Governance - AI security governance is deemed essential due to the unprecedented opportunities and risks posed by new technologies, including cultural bias, sensitive information leaks, and risks of model misalignment [6][7] - China Telecom plans to establish a comprehensive protection system covering infrastructure, data, content, algorithms, and applications to enhance data security [7] - A three-tier security risk classification system will be implemented, covering over 10 billion tokens, to improve code scanning, auditing, and tracing capabilities [7]

Group 1 - The core investment strategy of Honghu Fund in Q1 2025 involved significant increases in holdings of Yili Co. and Shaanxi Coal, while maintaining its position in China Telecom [1][5][8] - Honghu Fund's holdings include 1.53 billion shares of Yili Co. valued at 4.289 billion yuan, and 1.16 billion shares of Shaanxi Coal valued at 2.304 billion yuan as of the end of Q1 2025 [5][8] - The fund's investment in China Telecom remained unchanged, with a holding of 760 million shares valued at 5.979 billion yuan, reflecting an increase in market value due to stock price appreciation [5][8] Group 2 - The fund's sector allocation shows a distribution of 47.56% in communication services, 34.12% in data services, and 18.33% in coal mining [4][3] - The total number of stocks held by Honghu Fund is three, with two stocks increased and one stock unchanged in Q1 2025 [3][5] - The insurance capital market is experiencing a significant increase in long-term stock investments, with the scale rising from 500 billion yuan to 1.62 trillion yuan, indicating a growing trend of insurance funds entering the equity market [10][11]

Core Insights - The Smart Cloud Ecological Conference was held with the theme "Digital Intelligence National Cloud, Co-composing New Chapters" [1] - China Telecom's Tianyi Cloud Company introduced the latest technological achievement, the Triless architecture, during the conference [1] Group 1: AI Application Challenges - 2025 is identified as the year of AI application, with all future applications expected to be born, grow, and mature in AI [3] - Three major challenges for large-scale AI implementation were highlighted: efficient acquisition of computing resources, selection of training and inference frameworks, and convenient development of customized AI applications [3] Group 2: Triless Architecture Features - The Triless architecture aims to address the challenges by being "computing resource agnostic," "training and inference framework agnostic," and "AI tool agnostic" [3] - The "Xiangrang" platform upgraded its computing resource scheduling technology to connect diverse, cross-domain, and heterogeneous computing resources, allowing users to utilize computing power without being aware of underlying differences [3] - A self-developed heterogeneous training and inference framework was introduced, compatible with both domestic and NVIDIA computing resources, enhancing the performance of domestic computing and achieving compatibility with over 120 models [3] - A standardized AI development pipeline was launched, abstracting and encapsulating the AI toolchain into a ready-to-use development environment, allowing developers to focus less on tool differences [3]

Investment Rating - The report maintains an "Overweight" rating for the telecommunications industry, indicating an expectation that the industry index will outperform the market index by more than 10% in the next six months [1]. Core Insights - The telecommunications operators are experiencing steady growth in their user base, with mobile phone users reaching 1.8 billion as of March 2025, an increase of 9.945 million from the previous year [5][12]. - The net profit for major operators such as China Mobile, China Telecom, and China Unicom grew by 3.45%, 3.11%, and 6.50% respectively in Q1 2025, despite a slowdown in traditional telecom business revenue growth [23]. - The operators are focusing on enhancing shareholder returns, with dividend payout ratios for 2024 set at 73% for China Mobile, 72% for China Telecom, and 60% for China Unicom, reflecting a commitment to increasing cash distributions to shareholders [30][33]. Summary by Sections 1. Performance and Dividend Growth - The user base continues to grow, with mobile phone users reaching 1.8 billion and 5G users at 1.068 billion as of March 2025, marking a net increase of 5.445 million [12][5]. - The operators' revenue and profit are showing steady growth, with China Mobile's revenue for 2024 projected at 1,040.759 billion yuan, a 3.1% increase [18]. - The dividend payout ratios are increasing, with China Mobile planning a total dividend of 5.09 HKD per share for 2024, a 5.4% increase from 2023 [33]. 2. Capital Expenditure and Cloud Business Growth - Capital expenditures are focusing on computing power, with China Mobile, China Telecom, and China Unicom planning capital expenditures of 151.2 billion, 83.6 billion, and 55 billion yuan respectively for 2025, reflecting a decrease from previous years [37][38]. - The cloud business is rapidly expanding, with China Mobile's cloud revenue expected to reach 100.4 billion yuan in 2024, a 20.4% increase [48]. - The operators are enhancing their cloud services, with China Telecom's cloud revenue projected to reach 113.9 billion yuan in 2025, a 17.1% increase [48]. 3. Vertical Applications and International Business Growth - The deployment of 5G applications is accelerating, with China Mobile's 5G private network revenue reaching 8.7 billion yuan in 2024, a 61% increase [61]. - All three major operators reported double-digit growth in international business revenue, with China Telecom, China Mobile, and China Unicom achieving growth rates of 15.4%, 10.2%, and 15.2% respectively in 2024 [66][67]. - The operators are actively participating in international collaborations to promote 5G-A commercial deployment, showcasing their technological advancements at global events [66].

Core Insights - The report by IDC indicates a recovery in the public cloud market in China driven by AI, with the IaaS market projected to reach 94.82 billion RMB in the second half of 2024, reflecting a year-on-year growth of 13.8% [1] Company Rankings - Alibaba Cloud ranks first in the market, with its market share increasing for three consecutive quarters [1] - Huawei holds the second position in the market [1] - China Telecom ranks third, followed by China Mobile in fourth place and Tencent in fifth [1]

Group 1 - The core point of the article is the announcement of the "Xirang" integrated intelligent computing platform, which currently has a total computing power of 62 EFLOPS [1] - The platform consists of 35 EFLOPS of self-owned computing power and 27 EFLOPS of cooperative computing power [1] - There are 18 intelligent computing centers established in various cities and industries [1]

Group 1 - Beijing is accelerating the integration of digital economy and artificial intelligence, focusing on advanced technologies and optimizing the digital economy ecosystem [1] - The "One District, Three Centers" strategy is being advanced to enhance data governance and promote the construction of a data trading system [1] - China Telecom is leveraging its integrated advantages of "cloud + network + data + AI + applications" to support the digital transformation across various industries [1] Group 2 - China Telecom is rapidly building computing power infrastructure, including a computing scheduling platform and a large model training platform [2] - The industry is shifting from a "hundred model war" to optimizing cloud inference service efficiency, emphasizing the need for a collaborative approach across hardware, software, models, applications, and professional services [2] - The China Academy of Information and Communications Technology will focus on building a technical service system for the engineering delivery of large models to support healthy industry development [2] Group 3 - A talent cultivation mechanism is needed in the digital economy era, emphasizing the importance of university-enterprise cooperation for key technological breakthroughs [3] - Beijing Telecom and Beijing University of Posts and Telecommunications have established a joint laboratory for industry data intelligent labeling to support AI model training [3] - Beijing Telecom is showcasing innovations in AI, computing power, and data elements, having built a comprehensive AI service system to provide digital transformation tools for various industries [3]

Group 1 - The core viewpoint emphasizes that artificial intelligence applications are becoming a crucial engine for accelerating the construction of a digital China, with this year being marked as the year of large-scale AI application [1][2] - Over a hundred AI intelligent robots showcased at the Digital China Construction Summit, covering various scenarios from home services to industrial manufacturing and urban management [1] - The chairman of China Telecom highlighted the significant reduction in computational and algorithmic barriers due to new open-source AI technologies, which promotes the accelerated popularization of large model applications [1] Group 2 - China Unicom's chairman stated the importance of strengthening AI foundational innovation, having developed over 40 industry-specific large models that significantly empower economic operations and urban governance [2] - The need for an open and win-win cooperation framework is essential for promoting the construction of a digital China, with key drivers including accessible computing power, open-source models, and data flow [2] - The chairman of China Telecom called for greater collaboration across industries to foster deeper and broader levels of open cooperation in AI innovation and development [2]