Yangtze Telecom Corp. has announced that it has signed a revenue-sharing agreement with Hubei Telecom (China Telecom Hubei Branch) to provide the first SMS value-added services to over half a million Little Smart phone users in Wuhan.

The Company has completed the necessary system testing with Hubei Telecom and services are expected to commence in mid March 2004. Little Smart, known as personal access system (PAS) or personal handy phone system (PHS), is built on existing fixed-line networks by China's two major fixed-line network providers China Telecom and China Netcom.

Little Smart provides mobile-like services including SMS short messages via fixed phone networks within a city or community. Its main advantage is its extremely low charge per minute rate, which is typically 50 to 75 percent lower than those of China Mobile and China Unicom. SMS service communications between Little Smart and China Mobile and China Unicom is expected to be implemented in 2004. Currently, there are over 30 million users of Little Smart in China and it is estimated that Little Smart users in China will grow to as many as 90 million by 2005, representing approximately 25% of the 2005 total mobile phone customer base.