HUAWEI TECHNOLOGIES CO., LTD.

www.huawei.com

Leading

Profitable Mobile Broadband

- Huawei MBB Strategy

2011 Huawei Global Analyst Summit

Agenda

MBB market trends and challenges

Leading profitable MBB eco-system

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 3

2010 mobile terminals sales have a significant

impact on MBB

30% of smart devices sold in 2010 have an important impact on MBB!

984mn

[below

+18.5%]

Legend:

2010 shipments (million)

2009/2010 CAGR (%)

*) With cellular access

302mn

[+75%] 80mn

[+23%] 18mn*

[+63%]

3.9mn*

[N.A.]

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 4

$50B $6.4B

MBB is becoming a major source of revenue in

all regions

e.g. in 2010 Japan experienced more revenue from MBB than voice

It is expected that most of countries will follow Japan trend

$6.4B

$70B

$1.4B

Sources: Huawei World Market MBB Facts &

Statistics Q2-2010 based on 2009/2010 press

releases from Analysis Mason, Arthur D. Little,

CTIA, CCS Insight, Chetan Sharma survey,

Frost & Sullivan, Informa, OVUM, Pyramid

Research;

*) Estimation based on key

APAC countries situation

**) Based on 5 Europe countries:

France, Germany, Italy, Spain, UK

$35B** $8B**

USA (x3.2)

West Europe

(x4.4)

APAC (x4.2)

CALA (x4.5)

AME (x2.1) ***) SMS revenue to be

nearly half of all data

revenue

$22B***

$3B

$12B* 2014 2009

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 5

Need to convert volume into value

Fact: Millions of data applications are flying across mobile networks

Opportunity: The whole mobile industry and operators need to generate

revenue from this mobile data traffic

~ 700TB

Note: Across >20 countries in Africa, APAC, Europe, LATAM, North America regions

Source: Opera Mini mobile WEB browsing growth statistics [01-2011], http://www.opera.com/smw/2011/01/#snapshot

$ $ $ $ $ $ $ $ $

$

$

~ 300TB

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 6

Challenges in building a profitable MBB business

Value/Bit (Revenue Creation)

X

Z

Y

To compete with OTT, content providers, handsets suppliers…

To avoid being “bit pipe” providers only

USD/Bit (TCO Optimization)

End-users/Operators (Closed Relation)

To invest more and more network capacity

To deal with multiple networks

To deliver the best QoE with minimum

CAPEX/OPEX

To understand consumers interests and needs

To innovate for developing new business model (“value based pricing”)

To tackle new mobile opportunities like mobile cloud computing

Agenda

MBB market trends and challenges

Leading profitable MBB eco-system

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 8

GP

Vivo Globe

AM

CU

Mobily

Maxis

ET

FT

DT

VF

AT&T NTT

TEF

Bharti

Focus: Users

Experience & Network

Efficiency

Focus: Users & Data

Applications Eco-

system Development

Focus: Network

Solution for building a profitable MBB business

10%

10%

30%

50%

Non-SMS Data Revenue %

MBB Subs. %

30%

20%

20%

Broad

Smart

Single

+

+

50%

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 9

Single network – To guarantee optimized TCO

and smooth migration

Note: WiFi can be included into that multi-access scenario

Self-Organizing Network

Multi-Carrier

Multi-Access Standards

Flat Architecture

All-IP Transport

Multi-Antenna

“Networking Toolkit Box”

SingleCore

SingleRAN

SingleBackhaul

GSM

UMTS

LTE

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 10

North America

Latin America South Africa

MENA&CIS Europe

Single network – Huawei main choice of global

operators

The 1st vendor to provide convergent Single products

Large scale rollout with 100+ commercial references

Asia Pacific

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 11

Broad network - Meet 500X traffic challenge

The pipe shall not be the bottleneck of MBB growth

10X Hetnet

5X DC/MIMO/Re-farming

10X LTE/LTE-A

Solution

Access

Backhaul

Core

500X

500X

500X

500X traffic growth till 2020

2020

Traffic

500

X

• MBB user base will increase from 0.4 billion to

4 billion in the next 5 years

• Mobile Data Capacity prediction (CAGR=100%):

2011=1x 2012=2x 2020=500x

Source: Huawei Analysis (2010)

50X T3 Solution

10X IP MicroWave

50X Multiple Core CPU

10X Distributed Gateway

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 12

Broad network – To leverage broad contents through

Huawei inTouch Partnership Program

Latin America

AcotelWaumovilCyclelogicYavoxTakenet…

RotanaInfo2cellCadic SodiMobile-Zon…

CIS, M Asia

Europe

ArenamobileOperaJambaIndexEMINet-MExit Games…

North America

VerisignSONYWarnerNavteqTCS…

Africa

StarfishLeafSGKMobile Planet...

Asia

TencentAccessNavitimeJIGNetqinMobileExtremeSina…

Middle East

i-FreeInform-mobile…

Latin America

AcotelWaumovilCyclelogicYavoxTakenet…

RotanaInfo2cellCadic SodiMobile-Zon…

CIS, M Asia

Europe

ArenamobileOperaJambaIndexEMINet-MExit Games…

North America

VerisignSONYWarnerNavteqTCS…

Africa

StarfishLeafSGKMobile Planet...

Asia

TencentAccessNavitimeJIGNetqinMobileExtremeSina…

Middle East

i-FreeInform-mobile…

Over 300 CP/SP partners worldwide

Registration &

Account

application

Download

Dev Tool &

Create

Service

Test &

Approve

App/Service

Description

Upload

Operators

Choose

and Place

Orders

Launch

with

Huawei

SDP

inTouch

Online

Gallery

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 13

Broad network – To build alliance for addressing data

applications

[16-02-2011] Smart Philippines, the first global

commercial WAC enabled app store. The platform

provides opportunities for global developers to

create, synchronize and sell applications using

standard and open Application Programmable

Interfaces (APIs).

[15-02-2011] eBay deal to pre-load its

mobile apps into phones sold by Telefonica

UK. This is the 1st mobile pre-load deal

agreed by eBay anywhere in the world, and

the 1st time Telefonica has selected an app

to make available to its customers

[28-03-2011] Telefonica and Microsoft setup a partnership to

power applications development. In the short term, Telefonica

BlueVia SDK will integrate its key APIs (e.g. SMS, MMS,

advertising, users contextual information, etc.) with Microsoft's

Visual Studio, Silverlight and .Net Framework

Proven capability to bring Apps/Content through 3rd party on local or

international basis

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 14

Smart network - Beyond the dumb pipe to become

profitable

Visible: Clear network visibility on users behavior & services behavior

Manageable: Flexible policy & charging control, bandwidth use efficiency

Profitable: Triple win business model with friendly API to 3rd party providers

Visible

Manageable

Profitable

Dumb pipe

IP Backhaul, IPN

Big bandwidth

SGSN GGSN

Policy & Charging

Network visibility

Triple-Win

Unified Multi-access

DPI & SUR

PCC

API

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 15

Smart network - To leverage mobile cloud

computing capabilities

Operators MBB strategies need to be in line with mobile devices data and

cloud capabilities

Traditional handset

Low data traffic & voice

centric handsets

1

“Dumb/Cloud” device

Powerful GUI, tight

interaction with

networks & appl.

2

Smartphone

Powerful GUI,

embedded multimedia

appl. Smart-phones

3

Laptop, notebook,

tablet, PSP

Heavy data centric

terminals

4

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 16

Huawei MBB solution to guarantee profitability

Profitable MBB Business

Single

Unified platform

across all

technologies

Broad

Meeting capacity

needs and

developing a healthy

data applications

eco-system

Smart

E2E synergy to

improve the network

efficiency and the

end-users experience

Continuous customers-centric innovation

HUAWEI TECHNOLOGIES CO., LTD. Huawei Confidential Page 17

Huawei MBB investments

75+ Key roles held

in standards organizations

10 Wireless R&D centers

20000+ R&D engineers

6400+ LTE/SAE 3GPP proposals

16 Joint mobile innovation

centers

Thank you www.huawei.com

Copyright© 2011 Huawei Technologies Co., Ltd. All Rights Reserved.

The information contained in this document is for reference purpose only, and is subject to

change or withdrawal according to specific customer requirements and conditions.