GBP #487 - Breakthrough of 10,000-port switch
#487 - Breakthrough of 10,000-port switch
In the field of communications, after the advent of the 8080 chip and a batch of professional decoding chips, breakthroughs were successively made in switchboards, surpassing 3,000 lines and then 5,000 lines, culminating in the latest breakthrough: a 10,000-line program-controlled switchboard!
In the main world, this technological achievement would not be realized until 1970, when Gaul (France) inaugurated the world's first program-controlled digital switch. It was not until the mid-1970s that 10,000-line program-controlled switchboards were achieved. As for Dongda (Japan), it was not until 1982 that they spent a lot of money to import the first 10,000-line program-controlled switchboard, and it was not until 1991 that they achieved the first domestically produced 10,000-line program-controlled switchboard!
It was fraught with difficulties. In the ideal life scenario of 'electricity and telephones in every building,' it was not until after 2000 that ordinary families began to truly and comprehensively popularize telephones, because in the early days, the initial installation fee for a telephone alone cost several thousand when the average monthly salary was only a few hundred, which was simply unaffordable for most families.
However, in the world of 'Bright Sword,' the breakthrough in large-scale integrated circuit chip production technology, which Ren Zhong focused on promoting as one of the key technology fields, brought about breakthroughs in design and chip application scenarios. In addition to personal computers, the first large-scale application opportunity was in the field of communications.
Since the entire set is independently designed and manufactured, the cost of Dongda's 10,000-line program-controlled switchboard in the 'Bright Sword' world is very impressive.
With competitors facing costs as high as $500 per line, Dongda's 10,000-line program-controlled switchboard could reduce the manufacturing cost to below $100 from the very beginning!
In the conference room of Dongda Telecom ET Company, the atmosphere was both tense and excited.
Professor Tang Haoqiang, as the general manager of the company, had just walked in, his face filled with undisguised joy. He held a report in his hand, which stated that the company's latest 10,000-line program-controlled switchboard had completely passed the strict testing items in the type test, meaning that the company had once again made a new breakthrough in impacting large-capacity switchboards.
This report not only marked another technological leap for ET Company, but also heralded the further consolidation of the company's position in the global telecommunications market.
"Dean Ren, we did it!" Professor Tang Haoqiang's voice trembled slightly as he handed the report to Ren Zhong, his eyes flashing with excitement. "Our 10,000-line switchboard research and development has been successful. After the news is released, it will definitely cause a huge sensation in the international telecommunications market. I can see that our order volume will usher in a new round of rapid growth. Now our production cost, with a doubling of capacity, is less than 20% higher than the production cost of a 5,000-line switchboard after using a large number of new chips. According to the pure BOM material list cost and manufacturing cost, we are now below the comprehensive production cost of $100 per line. The mainstream products on the market are generally still priced at more than $500 per line. Do we need to further reduce prices to completely collapse the market price and defeat our competitors in one fell swoop?"
Professor Tang Haoqiang's eyes revealed a fierce look. Previously, the market price of a 5,000-line switchboard was $500. Under the leadership of Ren Zhong, Dongda Telecom ET Company competed at a price of $450 per line, fighting back and forth with them, but their profit margin was the best among them. This allowed the research and development expenses of the Communications Technology Research Center to be fully recovered from market sales, and the excess profits could be used to support other new technology research that had no income for the time being.
Ren Zhong took the report, his eyes quickly scanning the exciting performance indicator numbers. He nodded, a satisfied smile on his face. He knew that this was not just another victory in new product research, but the beginning of a new era in telecommunications.
When switchboards enter the era of 10,000 lines and the market price is driven down, the tide of telephone popularization will begin.
"Professor Tang, this is the result of our team's efforts, and it is also a reflection of our technical strength." Ren Zhong's voice was calm and powerful, his eyes revealing a firm belief in the future. "Our sales strategy, of course, is to continue to suppress our competitors, but we don't need to kill them all at once. The international telecommunications market is too big. It's not feasible to monopolize it."
Professor Tang Haoqiang nodded, knowing what Ren Zhong meant. In this globalized market environment, cooperation and competition coexist. Only by maintaining the vitality of the market can we promote continuous technological progress.
"Now that we have a technological advantage, we can temporarily reduce our concessions in terms of international telecommunications market sales prices, so as not to make them feel that our technology is worthless." Ren Zhong continued, his eyes gleaming with wisdom.
"Our price per line should continue to stick close to our competitors. In the international telecommunications markets of the great powers, we can also appropriately further reduce profits, competing at a price 15% lower than theirs. We can now sell in bulk at a price of $425 per line, and the price to the channel can be $400, so that global users can also experience the benefits of technological progress. Our call quality and the reliability of the product itself are now absolutely leading them. We must vigorously promote this point. With this technological advantage and this new price, the competitiveness of our products is beyond doubt." Ren Zhong's tone was firm. Having lived in two worlds, Ren Zhong knew the common rules of international product pricing. It is not simply based on one's own costs, but on the company's overall development strategy and long-term sustained combat thinking.
"Don't feel embarrassed because we make too much money. When the great powers use their technological advantages to harvest our market, they have never been soft-handed." Ren Zhong's words carried a hint of coldness. He knew that in this cruel business world, only the strong can survive.
"For high-tech products, we must dare to price them according to the market price, not according to the production price," Ren Zhong said.
For Professor Tang Haoqiang and the senior executives of ET Company present, this was another major shock. All along, their thinking has been based on the principle of pricing from a cost perspective, whether it is a 50% or 100% markup, there is generally an upper limit.
Like Ren Zhong's unreasonable approach, getting the gross profit margin to over 300% is an insanely high profit!
"We can't feel that our selling price should be low just because our production cost is low and our labor is low. That's not the case." Ren Zhong's voice was firm. He knew that this was a strategic idea concerning the company's future positioning. ET cannot let people think that it can only produce cheap products, but is a synonym for high-tech products!
"We must benchmark the international product pricing system and benchmark the position of our product's technical performance parameters in international products." Ren Zhong continued, his eyes flashing with a few scorching rays. "If our product quality really reaches or even exceeds our competitors, then we dare to use the best price of our competitors as a pricing reference. Our 15% discount is already very sincere."
"As for promotion, we can spend more effort to showcase our products in various aspects, such as national exhibitions and demonstration projects, and promote our communication products like cars."
Dongda Telecom's ET Company is the primary entity responsible for promoting the telephone exchange. The general manager was transferred from being a technical lead at the Telecommunications Technology Research Center. Of course, when he initially took on this important role, it was just when the thousand-line telephone exchange was newly developed.
After so many years of development, ET Company has grown into an international corporation. The global sales volume of its thousand-line, three-thousand-line, and five-thousand-line telephone exchanges has already begun to account for about 10% of the industry, because the five-thousand-line exchange is currently top-of-the-line.
Now, the creation of the ten-thousand-line telephone exchange is an even bigger deal, a first of its kind. Once announced, it will almost undoubtedly make headlines in major global science and technology media outlets. Therefore, in terms of technical recognition, Dongda Telecom's ET Company has already had a very good start.
Ren Zhong's words reflect what he has been advocating. In the international telecommunications market competition, ET has generally been vying for orders with prices about 10% lower than its competitors. Although many countries and regions have not considered ET as a primary supplier for various reasons, the excellent performance and more affordable prices have allowed ET to grab a share of the international telecommunications market, becoming one of the world's mainstream telecommunications product suppliers.
When the ten-thousand-line program-controlled telephone exchange was launched, Tang Haoqiang's original idea was to take advantage of this opportunity to completely destroy the competition with low prices! For example, by directly lowering the price per line to the current ultra-low level of 300 or even 200 US dollars, many telecommunications companies would probably be unable to withstand it and go bankrupt, directly wiping out the market and defeating the competition.
This is because the vast majority of competitors are still producing old-fashioned crossbar telephone exchanges, which are not only costly but also have high maintenance costs and poor product reliability. After ET launched the new program-controlled telephone exchange, only a very few companies have been catching up, and have now developed a thousand-line program-controlled telephone exchange.
"Dean Ren, I understand," Professor Tang Haoqiang nodded, a look of understanding and determination in his eyes. "We will not miss this opportunity. We will go all out according to Dean Ren's positioning of our products and continue to use our strength to let the world see the power of Dongda Telecom."
Ren Zhong smiled and nodded. He knew that this battle had only just begun. He stood up, walked to the window, and looked at the bustling streets outside, his heart filled with anticipation for the future.
"However, this price is for external sales. In our Dongda Telecom market, we will continue to implement a dual-track pricing system, basically selling according to the principle of meager profits. However, this sales price must be strictly confidential. It is best to adopt a method of equity participation in telecommunications, on the one hand, to reduce the cost pressure of Dongda Telecom's network construction, and on the other hand, to increase Dongda Telecom's operator capital, which will facilitate overseas listing and financing in the future."
From the perspective of overall development, the Dawn Group is just a locomotive for industrial take-off. It is responsible for running ahead and leading the way, and most of the industries behind it still need to be developed sustainably through market development.
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In the months that followed, Dongda Telecom's ET Company's ten-thousand-line program-controlled telephone exchange set off a storm in the global market.
With its advanced technology and reasonable pricing, ET Company's telephone exchange quickly seized the market, and orders soared. Competitors began to feel the pressure and had to start considering how to adjust their strategies to meet the challenges of ET Company.
At major global science and technology exhibitions, Dongda Telecom's ET Company's booth was always crowded with people. Visitors showed great interest in ET Company's ten-thousand-line program-controlled telephone exchange. They spoke highly of ET Company's product performance and reliability and were full of expectations for ET Company's future.
In some developing countries, Dongda Telecom's ET Company's telephone exchange has become key to improving communications infrastructure. Telecommunications operators in these countries have begun to purchase ET Company's telephone exchange on a large scale to meet their growing communications needs. ET Company's telephone exchange not only improved the quality of communications in these countries but also saved them a lot of money.
In some developed countries, Dongda Telecom's ET Company's telephone exchange has also begun to attract attention. Telecommunications operators in these countries have begun to realize that ET Company's telephone exchange is not only reasonably priced but also has excellent performance, making it a worthwhile option to consider. They have begun to contact ET Company to explore the possibility of cooperation.
As time went by, external operators gained an in-depth understanding of Dongda Telecom ET Company's products. After experiencing clearer voice and more reliable quality on-site, the low cost, coupled with a substantial reduction in subsequent operation and maintenance costs, the overall life cycle advantage of ET Company's 10,000-line exchange is at least 30% higher than current competitors. The market share is rapidly expanding.
The 10,000-line program-controlled telephone exchanges began to sign contracts with one developed city telephone network operator after another.
Watching the endless stream of 10,000-line program-controlled telephone exchanges being shipped all over the world, ET Company's employees felt even more proud. They knew that their company was making history. They knew that their efforts and innovations were changing the world.
ET Company has gone from keeping pace with the telecommunications equipment vendors of the great powers to becoming a leader. From the perspective of orders, the market share has gradually increased sharply from the previous ten percent to more than thirty percent!
There is no doubt that Dongda Telecom ET Company will write its own legend in the global telecommunications market.
Ren Zhong knew that if he pushed ET Company to be listed overseas at this time, it would become Dongda's first 10 billion U.S. dollar company in minutes, but he was not in a hurry. After waiting for the 10,000-line program-controlled telephone exchange to truly control the leading position in market development, he would strive for better performance before releasing it. By then, he would make a single effort to impact the world's first 50 billion U.S. dollar company!
It should be known that in the main world, this record will not be created until the 1980s. Ren Zhong wants Dongda Telecom ET Company to achieve such a goal in the 1960s of the Bright Sword world. Obviously, the plan is very big. The battle of the technology industry has only just begun with the emergence of the 10,000-line program-controlled telephone exchange.
Next is the wired network and wireless communication (End of this chapter)