Steve Zhang: I think our standard contract terms is generally [ph] ask customer for 25% to 30% pre-paid.
Brendan Barnicle (Pacific Crest Securities): Any thing different on the competitive front?
Steve Zhang: Not really. I think that we are still competing against the same old competitors we have been competing with that Linkage, Digital China, companies like that.
Brendan Barnicle (Pacific Crest Securities): You had mentioned that interest income was going to be down sequentially from where it was last quarter. So should we be assuming may be something below $2 million in contribution?
Eileen Chu: Yes, in the fourth quarter 2007 our investment return is approximately about $1.5 million – $1.6 million. So I think our expectation is to be lower than that.
Sean Jackson (Avondale Partners): I am trying to get a better handle on the distribution of your revenue amongst the three carriers because it sounds like China Telecom is becoming more important. Can you just go over approximately what that was in the third quarter and where you intend to see that not only in the fourth but really through 2009?
Steve Zhang: In the third quarter, China Mobile is still a majority of our revenue. It’s roughly 70% of our revenue contribution for our telecom revenue. And China Unicom plus China Netcom, since they only they have started to merge in the in the fourth quarter this year, in the third quarter China Unicom contributed 10% of the revenue, and Netcom contributed roughly 8% of the total telecom revenue.
Sean Jackson (Avondale Partners): Do you have any insight as to where do you think those percentages will go in 2009?
Steve Zhang: I think that long term trend definitely the contribution from China Mobile will be coming down. I think that the reason is the growth rates on the two other carriers are faster because China Telecom and the new China Unicom needs a lot of more integration services to help them to do the newly acquired business integration.
Sean Jackson (Avondale Partners): Can you just give us some insight as to when you sign contracts like this China Telecom contract, win over a little bit before, but how long a period will you recognize revenue from that contract? And also do the margins on that contract differ according to the time period?
Steve Zhang: Normally it will take us nine to 12 months to book the contract’s value as revenue. And since we are booking most of our revenue based on our project implementation plan, the resource we put in, the margins will be roughly evenly distributed along a project’s life time.
Sean Jackson (Avondale Partners): And the third-party hardware revenue, it jumps around quarter-to-quarter. Is it probably going to increase in the fourth quarter given that it was so low in the third or is there any visibility at all into that for you?
Steve Zhang: I think third-party hardware tends to fluctuate on a quarterly basis and that’s why we want you to focus our net revenue guidance.
Sean Jackson (Avondale Partners): On your fourth quarter guidance, you talked a little bit about the tax rate and the possibility of getting a benefit. What tax rate are you using for the $0.14 to $0.16 guidance?
Eileen Chu: Well, for the nine months our effective tax rate was about 20%. So for Q4, I would also suggest you use 20% on a conservative basis because I’ve also mentioned that that two special tax statuses in China, which we have been getting for the last five, six years, but the problem in China is you accrue your tax base on a tax rate and then when you get approval from the government on those tax statuses then you get a refund. But the problem is we can''t control the timing of those approvals even though we have been getting it for the last five years. So if we get a tax status approval then we will tax our refund for the previous quarters. And that will mean lower tax rate in Q4, but right now since we haven’t got it yet, so we use a higher tax rate on the prudent side.
Julie Chen (CRT Capital Group): Could you please help me understand the potential synergies coming from C platform investment exercise?
Steve Zhang: First of all, it’s various small minority equity stake investment we are making in C platform. Secondly, I think the synergy is we share the same customer base and our business intelligence solutions will help them a lot in helping them to understand the consumer preference, which value-added services the consumers like and how to do the effective marketing to all those consumers. And that on the solutions side is the synergy but that’s the more demand from the value-added service side will also drive our Business Intelligence solutions sale. And another synergy is on the sales and marketing front is we share the same customer base and we can leverage each other to drive both our companies’ sales.
Julie Chen (CRT Capital Group): In terms of sales and marketing, you are saying that there is certain synergy that comes out, so if I would envision how this will work, is that they would also potentially help AsiaInfo’s service and products while C platform penetrates the value-added services area of the telecom industry. Is that the right way of looking at it?
Steve Zhang: I think the right way to looking at that is in certain customers where we have pretty strong customer relationship we’ll help C platform to penetrate into the account and in other customers where C platform has pretty strong customer relationship and installation base, it will help AsiaInfo to penetrate into those accounts.
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