Opportunity And Challenge

1

• Opportunity And Challenge
• In Emerging Market

Michael Lee StrategyMarketing Dept, West Africa
Region Huawei Technologies
2
Agenda

• The Opportunity and Challenge of Emerging Market
• Continuous and Future-oriented Innovation
• Huaweis Progress

3
Mobile Emerging Market Opportunity
In the coming 5 years, it will happen
Global Mobile Subscribers
Global Mobile Annual Revenues
(by USD)
3.6
(AGR)
New Adds (bn)
434
2.3
12.3
310
159
1.1
2.6
89
1.5
275
4.4
0.2
221
1
0.8
2006
2010
2005
2010
Developed market
Emerging market
Developed market
Emerging market
Source Merrill lynch, Strategy analysis

• There will be a total 1.3 billion potential sub
  scale
• 85 of them come from emerging market

• Emerging markets are about 70 of total expected
  growth over next 5 years

Great Opportunities Lie in Emerging Market
4
Double Low One High in Emerging Market
VS

• Double Low

• One High

• Low penetration
• Low ARPU

• High subscribers growth rate

• Potential market for EM

• Young, middle and low end people constitute the
  potential market
• Lowering entry cost
• Lowering the tariff
• To Grasp Subs. Low cost is the Most Important
  Task in Emerging Market

5
Two Major Issues
COST
EVOLUTION

• TCO Reduction
• CAPEX Saving
• OPEX Saving

• Investment Protection
• Smooth evolution
• High performance

Maintaining tight cost control and evolving to
all-IP network
6
Huawei GSM Innovation Strategy for EM
Entire E2E TCO Saving Solutions Profit with
declining ARPU
TCO Saving

• Power Saving
• Transmission Saving
• Sites Reduction

Smooth Evolution to All-IP Network Protecting
investment, keep advantage
Future-oriented

• IP Architecture
• Core Network Over IP
• IP BSS

7
How to Save Power Consumption
power consumption
Old
New
New IC, Half Static Power
Ad Voltage up10 efficient
8
Intelligent Power Management
Typical Configuration for S4/4/4
Power control DTX
20 saving
2000W
Priority BCCH TRX
40 saving
Power Consumption
1600W
1000W
Adjustable voltage
Lower static power
Indoor Macro (07)
Industrial Indoor Macro (05)
Industrial Indoor Macro (06)
Lower power consumption, less expenditure in
generator
9
Direct Cooling Technology Reduces Power
Consumption
Less cool power (Outdoor Macro BTS)
Marco BTS

• Benefits
• Decreases power consumption by over 80 compared
  with air-conditioner BTS
• Longer backup time without adding extra battery

10
Alternative Energy Solution
Combination of Solar-Power and Wind System
Solar Power Solution
Biofuel Generator Solution

• Benefits
• Green energy resources
• Saving OPEX in long time life cycle
• Low maintenance cost

11
Innovative Local Switching
MSC Server
MGW
BSC
BSC/BTS LCLS

• Benefits
• Only signaling pass through Msc Server, so it can
  save traffic transmission resource

12
Abis IPoverE1 Solution
BSC
BTS

• Benefits
• Traditionally the ABIS multiplexing is about
  151 or 161 or 141. Huawei supporting up to 24
  carriers per E1

13
Taking Mobile Network Toward All-IP
BSC/RNC
BTS/Node B
Mobility
CS
PS
Data
Video
IPTV
Access network over IP From 2006
IMS
Triple- Play
Video Comm.
VoIP
Core network over IP From 2004
Voice
Services over IP
14
IP Architecture

• Benefits
• All IP architecture, protecting investment, lower
  cost

15
Core Network Evolution

• Benefits
• Mobile Network is Migrating to All IP Network
• More abundant services, higher efficiency, lower
  cost

16
BSC/RNC Design Based on All-IP Platform
2
1
Smoothly Evolution to 3G
Unified All-IP Platform
Software upgrade

• 2G,3G Co-cabinet

• BSC RNC Co-platform

• Flexibly adjust 2G 3G capacity

• BSC RNC Co-board

• Providing E1, STM-1, FE interface

• 2G evolve to 3G by software upgrade

17
Multimode BTS
LTE
LTE Card
HSPA
HSPA Card
IP Platform BTS
GSM
GSM Card

• Benefits
• Multi-mode BTS to support GSM/HSPA/LTE
  simultaneously, protecting investment and fast
  roll-out

18
Global Presence of Huawei Mobile

• Progress
• Serving 26 of the worlds TOP 50 mobile operators
• Secured 32.9 of new UMTS/WCDMA contracts awarded
  in 2006
• Patents and standards
• Over 8,000 patents in mobile communications
  technology worldwide.
• Over 3,000 patents in key UMTS technologies
• Submitted 5 of the general documentation for LTE
  to the conference.
• Applied 14 patents of Ultra Mobile Broadband
  (UMB) technologies

19
TOP3 GSM Supplier
Achievements
Global Footprints

• Serving 200 million GSM users in 80 countries
• 1,000,000 TRXs deployed globally, to Q1,2006.
• 350,000 TRXs shipment in 2006
• In Nigeria, provide GSM solution to all
  mainstream GSM operators.
• In CMCC group purchase project in 2007,
  700,000TRXs
• BSS23.6, ranked No.2, just 2.9 behind to
  No.1
• NSS37.1, ranked No.1

Netherlands
Philippines
Russia
20
Leading UMTS/HSPA Vendor
Cumulative UMTS/HSPA Commercial Contracts
New Contract Award and Market Share
51
47
18
6
2
Source In-Stat 02/2007

• Largest market share in 2006(calculated by
  contract number)
• UMTS/HSPA 53 UMTS/HSPA commercial contracts as
  of May 2007

21
Your Best Choice at the Age of Convergence

• Our overall advantages in terms of fixed network,
  mobile network and IP
• Leader in providing FMC solutions based on ALL IP
• Heavily invests in key areas including
  3G/4G?multi-play and IMS solutions

IP
CISCO Juniper
FMC based on ALL IP
ERICSSON NOKIA
ALCATEL
Mobile
Fixed
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