MID (Mobile Internet Device) Market in China

1. China's MID Market By:CatHughes

2. Definition of MID Introduced by the industry in 2007 Pocket-able handheld consumer electronics device designed to offer a portable full-page Internet experience By:CatHughes

3. Functionality Complete Internet experience with full-page web browsing Powerful computing capability enabling productivity applications to run (such as Microsoft Office) PC keyboard or handwriting function (providing operability that rivals the PC Independent and standardized operating systems MIDs are as open as PCs: allowing users to download and use any relevant applications By:CatHughes

4. Portability Weighs about 300g-500g Expected to drop as technology advances Screens size between four-six inches Providing full Internet experience Always on always connected Day-long battery life Consistently connected By:CatHughes

5. Connectivity Offer multiple Internet access technologies: WLAN WWAN Always-on service and seamless switching By:CatHughes

6. Source: TI By:CatHughes

7. MIDs Tailored to Mobile Internet MIDs offer most effective combination of Internet experience and portability By:CatHughes

8. Internet Experience and Portability By:CatHughes

9. Mobile Internet: Customer Requirements By:CatHughes

10. Internet On-The-Go By:CatHughes

11. MID: Best Solution for Mobile Internet By:CatHughes

12. Demand for Mobile Internet Growing By:CatHughes

13. Consumer Demand for MIDs: CHINA Mobile Internet Users in China (in Millions) Growth in China’s Mobile Internet Users (in Millions Rapid Growth Users who accessed websites or WAP sites via mobile phones at least once in the previous six months: reached 73 million in June 2008 44.9% growth rate from Jan 2008 Current penetration rate of mobile Internet users in China is about 10% By:CatHughes

14. China’s Mobile Internet Users Most consumers use mobile phones to access WAP sites rather than websites, while the amount of Internet browsing is very low This is due to the fact that: There are few handsets that support Internet browsing or offer good Internet experience ( limitations of screen size, processing capability and operability) Most mobile Internet users are not PC Internet users and have little need to browse the Internet The growing use of Internet for gaming and entertainment create enormous potential for MID market By:CatHughes

15. China’s Internet and Mobile Users 2008 By:CatHughes

16. China’s Internet and Mobile Users 2008 Of China’s 73 million mobile Internet users, only ¼ have PC Internet experience Most mobile users are soldiers, students, hired help and laborers Those who are unable to access the PC Internet on a regular basis Accessing real Internet via mobile phone is possible though the experience remains poor Currently more than 250 million PC Internet users in China Full mobile Internet experience an urgent demand By:CatHughes

17. Preferred Applications for Mobile Internet Users vs. PC Internet Users Preferred Applications for Mobile Internet Preferred Applications for PC Internet By:CatHughes

18. Potential Users of MIDs By:CatHughes

19. MID Usage Analysis: Business Professionals “MIDs Meet Demand for: On-the-Go Communication, Business, and Information” By:CatHughes

20. MID Usage Analysis: Media-Savvy Consumers “MIDs Meet Demand for: On-the-Go Communication and Multimedia” By:CatHughes

21. MID Usage Analysis: Young Adults “MIDs Meet Demand for: On-the-Go Sharing” By:CatHughes

22. Web-Based Mobile Internet Developments By:CatHughes

23. Market Overview By:CatHughes

24. Key Drivers By:CatHughes

25. Consumer Demand for Internet Experience on MIDs MIDs: directly address demand for On-the-Go Internet By:CatHughes

26. Development of Internet Applications Current handheld devices still do not fully satisfy consumers: MIDs have potential By:CatHughes

27. Maturity of MID Value Chain Led by Intel the x-86 base MID camp has developed into a complete industry ecosystem where CPU core suppliers, chipset platform providers, OS vendors and third-party application developers, and OEM and carriers are all working together to push market forward ARM-based chipset vendors: TI and Nvidia also aggressively pursuing MID market in China thus all elements of the value chain growing together to drive MID market development By:CatHughes

28. Barriers By:CatHughes

29. Forecasts: China’s MID Market Assumptions for Optimistic Forecast Assumptions for Conservative Forecast Development of 3G and WiFi hotspots will be delayed or slower than expected China’s economic growth will slow to an average rate less than 8% over next four years The average price of MIDs will remain around $500-700 Aggressive deployment and development of 3G cellular networks and WiFi hotspots China’s economy will continue to grow at average growth rate higher than 8% over the next four years Average price of MIDs to decline less than $300 USD by end of 2009 MID Shipments in China reach 7.2 million by 2012 MID Shipments in China reach 3.05 million by 2012 By:CatHughes

30. Optimistic and Conservative Forecasts for MID Shipments in China: 2008- 2012 (millions) By:CatHughes

31. Optimistic and Conservative Forecasts for MID Shipments in China: 2008- 2012 (millions) By:CatHughes

32. MID Ecosystem Update By:CatHughes

33. Mobility Environment By:CatHughes

34. Cellular Network Developments in China Recent Developments In May 2008 China began plans for telecom restructuring By 2010 it is expected that 3G networks will be available nationwide By 2012 3G subscribers expected to reach 264.7 million 3G Subscriber Forecast in China (millions) By:CatHughes

35. China’s Wi-Fi Outlook Also Optimistic Recent Developments Currently used in: households, office buildings, schools and public spots (airports, hotels, coffee bars, restaurants and supermarkets) It is estimated that 5 million household broadband users in China use Wi-Fi to access Internet at home China Telecom deployed over 10,000 Wi-Fi- hotspots and gained almost 8 million users in 2008 Government planning to build Wi-Fi in major cities Wi-Fi Hotspots Forecast in China (in thousands) By:CatHughes

36. Ecosystem Overview Source: TI By:CatHughes

37. Ecosystem Value chain /Revenue Sources By:CatHughes Source: TI

38. MIDs Providing Returns to Operators The Prospect of Data ARPU Operators currently reporting decline in ARPU but data ARPU has risen somewhat Mobile devices that provide PC-like Internet experience can greatly increase the use of data services MID can provide benefits to operators as data traffic becomes heavier on mobile devices Operators planning to cooperation with MID vendors to provide customized MIDs embedded with their services ARPU changes from 2006-2008 By:CatHughes

39. Internet Content and Applications By:CatHughes

40. User-generated Content and SNS Becoming the Center of Internet Applications Worldwide Share of Online Time Social Connections capture 16% of worldwide online time; this category didn’t even exist three years ago By:CatHughes

41. Mobile Internet Advancing More Rapidly than PC Internet in China Internet and Mobile Internet Trends By:CatHughes

42. Devices: MIDs based on Two Architecture Designs: x86 or ARM By:CatHughes

43. Comparison Between x86-Based and ARM-Based Chipset ARM-based chipset vendors are primarily cell phone chipset suppliers like TI and Qualcomm Intel is the main x86-based MID chipset vendor (Atom) By:CatHughes

44. MID Hardware Architectures By:CatHughes

45. Hardware Considerations Source: TI 2008 By:CatHughes

46. MID Product Groups and Features By:CatHughes

47. MID System Architecture- Block Diagram By:CatHughes

48. MID System Architecture Considerations By:CatHughes

49. TI’s OMAP3xxx Soc for MID design By:CatHughes

50. Benefits of SOC in MID Design By:CatHughes

51. MID Software Architecture By:CatHughes

52. Software Architecture Overview By:CatHughes

53. What is Different in MIDs? By:CatHughes

54. Complete solutions for optimization and differentiation By:CatHughes

55. Software Stack for MID and Smartphone By:CatHughes

56. Software critical to device Success By:CatHughes

57. Summary: MID combines: Functionality, Portability and Connectivity to directly address the growing demand for a comprehensive “on-the-go internet experience” Key drivers of industry in China are Consumer Demand for Internet Experience, Maturing of MID Value Chain and Development of Internet applications Software and hardware developments both play integral role Optimistic and Conservative Forecasts for MID shipments in China: 2008- 2012 (millions) By:CatHughes

58. Sources: InStat Research: Texas Instruments : MID Market Overview and Webinar By:CatHughes