•  the deployment of an intelligent NGN network for fixed line and multimedia services;  •  the development and deployment of Green IDC for meeting the new demands of cloud computing  services;  •  the deployment of a high-capacity long-haul reconfigurable optical add drop multiplexing system  and a nationwide internet protocol backbone network with hundreds of Gbps gigabit switching  routers for internet and managed IP services; and  •  the expansion and upgrade of our mobile services network as well as WiFi/Femtocell to improve  indoor 3G mobile network coverage and transmission speed for mobile internet.  Provisions for pension payments to our employees  Taxation  As a result, we made aggregate capital expenditures of NT$133.0 billion over the period from January 1,  2006 to December 31, 2010.  Our long-term goal is to optimize our capital expenditures by focusing on investing in innovative products  and services with attractive return profiles. We evaluate our investment opportunities by benchmarking them  against internal return requirements. We are currently finalizing plans for the gradual upgrade of our entire public  switched telephone network to a next-generation network. Next-generation internet protocol switches will have  substantially more capacity and greater upgrade flexibility and should result in increased operational efficiencies  from reduced switching centers and related property, materials and personnel costs. We have also devoted  resources toward the effective upgrade of our 3G mobile network to 3.5G and HSPA+ and the continuing build- out of our FTTx infrastructure. In addition, we are planning to deploy green Internet Data Centers and service  delivery network for the innovative services, such as cloud computing, fixed mobile convergence services and  four-screen digital convergence services.  Personnel expenses constitute a significant portion of our operating costs and expenses. In 2008, 2009  and 2010, personnel expenses represented 28.6%, 29.4% and 30.4% of our total operating costs and expenses,  respectively, and pension costs represented 2.0%, 1.9% and 2.0% of our total operating costs and expenses,  respectively. The table below sets forth information regarding our personnel expenses and as a percentage of our  total operating costs and expenses for the periods indicated.  At the time of our privatization, our then existing defined benefit pension obligations were settled in  full. After completion of our privatization, our continuing employees were deemed to have commenced  employment as of the date our privatization was completed for seniority purposes under our pension plans in  effect after privatization. Under applicable Republic of China regulations, upon our privatization, the Ministry  of Transportation and Communications assumed the obligation to make annuity payments to our employees who  retired before our privatization.  In May 2009, the Legislative Yuan passed an amendment to Article 5 of the Income Tax Law, which  reduces the income tax rate of profit-seeking enterprises from 25% to 20% effective in 2010. Furthermore, in  May 2010, the Legislative Yuan passed the amendment of Article 5 of the Income Tax Law, which reduced the  income tax rate of profit-seeking enterprises from 20% to 17%, effective on January 1, 2010. We benefit from tax  incentives generally available to technology companies in the Republic of China, including tax credits of up to  30% of the amount of some of our research and development, automation and employee training expenditures in  accordance with the Statute for Upgrading Industries. We also qualify for tax benefits at a rate of 5% to 15% of  68 PART I For the year ended December 31, 2008 2009 2010 (in billions of NT$, except percentages) Personnel expenses: Salaries 22.1  15.5% 22.4  15.8% 22.9  15.8% Insurance 1.6  1.1  1.8  1.3  1.9  1.3  Pension 2.9  2.0  2.7  1.9  2.9  2.0  Other 14.3  10.0  14.8  10.4  16.4  11.3  Total personnel expenses 40.9  28.6% 41.7  29.4% 44.1  30.4% Total operating costs and expenses  143.1   100.0%  142.0   100.0%  145.0   100.0%