Telecom Market in China Opportunities and Challenges

LEON LI @BEIJING , CHINA

Start to use

Slackware

from 1997

Served in PLA for 10 years

With Red Hat for 5 years

TAM,

Presales,

Account sales manager

RHCE & RHCA

“

”

It was the best of times,

it was the worst of times

Charles Dickens

China Telecom Industry 101

KEY FACT IN CHINA-TELCOM HOTSPOT

Taiwan

Population

Beijing 25M

Shanghai 25M

Shenzhen/

Hongkong 20M

KEY FACT IN CHINA-USERS

3G Subscriber 150M

1 Billion 230 Million In China In USA

Mobile subscriber Mobile subscriber

vs.

Smartphone User 250M – 25% ( 30% growth/Y)

ARPU 20USD vs. Average 10 USD

Internet User 538M (40%) vs. 388M Mobile user

KEY FACT IN CHINA- LOCAL BRANDS WITH COMPETITIVE PRICE

3.5” / 320*480

Android 2.3 78 USD MSM7225A 800M HZ

512 M

WCDMA/GSM Dual Simcard

3M Pixel Camera

CHINA TELCO INDUSTRY STRUCTURE

NEP

China

Mobile

China

Telecom

China

Unicom

Policy License

MIIT

HUAWEI

ZTE

Operators

CHINA TELCO INDUSTRY STRUCTURE

Headquarter Departments

CM Head Quarter

31 Provincial Branch

Companies

China mobile Internet Company

Research Institute

of China Mobile

Largest Carrier – GSM/TD-CDMA

655M mobile subscribers

Employees 145K

Listed on both NYSE and HKSE

Revenue 83B USD

Data service 22B USD

China

Mobile

CHINA TELCO INDUSTRY STRUCTURE

Headquarter Departments

CT Head Quarter

Beijing/shanghai Research Institute

31 Provincial Branch

Companies

Largest fix and broadband service company - CDMA

140M mobile subscribers

80M+ broadband users

Listed on both NYSE and HKSE

Revenue 38.6B USD

Employee 312K

China

Telecom

CHINA TELCO INDUSTRY STRUCTURE

Headquarter Departments

CU Head Quarter

31 Provincial Branch

Companies

E-business company

Research Institute

of China Unicom

3rd operator in China – GSM/CDMA

202M mobile subscribers

60M broadband users

Listed on both SSE, NYSE and HKSE

Revenue 33B USD

Employee 214K

China

Unicom

CHINA TELCO INDUSTRY STRUCTURE

2nd NEP in the world private company

Headquarter is in Shenzhen

4 business groups:

--Enterprise, Carrier, Consumer and others

Revenue in 2011 : 32B USD

Employee 146K

Branches in 150 countries

HUAWEI

CHINA TELCO INDUSTRY STRUCTURE

Headquarter in Shenzhen

Revenue in 2011 : 13.5 B USD

Employee 89K

Branches in 107 countries

ZTE

• Huge mobile subscribers & Internet users with fast growth

• Enterprise begin to get used to open source

• A great number of Java developers

• Operators are forced to conduct innovation

• WECHAT’s popularity makes CM SMS/MMS income reduce

OPPORTUNITIES

KEY CHALLENGES • Open source community not active

• Enterprise still think open source as free

( RH GC revenue 23M USD, 50%+ are from OEM and most enterprise buy because of license issue)

• VOIP license still not issued

• No local presence

• No enough awareness for Mobicents

STRATEGY • Leverage the community to prompt Mobicents

• local tech resource presence in China

• Focus on enterprise market in short term (e.g. call center solution)

• Build ISV ecosystem

THANK YOU LEON LI

PHONE: +86-139 010 79663

MAIL: xli@telestax.com