11
India handset market is growing faster than other key markets; margin pool is India handset market is growing faster than other key markets; margin pool is expected to be $3 Billion in 2009expected to be $3 Billion in 2009
67110 145 190
144180
206223
170180 186 189
0%
20%
40%
60%
80%
100%
2006 2007 2008 2009
India Greater China North America
TAM Units (Millions) Margin Pool ($ Billions)
• India margin pool is expected to grow at CAGR of 45%; 3X times that of Greater China
1.1 1.6 2.3 3.2
4.15.1
5.86.2
5.7 6.26.0 6.1
0%
20%
40%
60%
80%
100%
2006 2007 2008 2009
India Greater China North America
42%
16%
4%
45%
15%
2%
CAGR(06-09)
13%
15%
13%
% of World(2009)
CAGR(06-09)
7%
13%
12%
% of World(2009)
Wireless Market Growth: GlobalWireless Market Growth: Global
VAS and Email are2 Key Areas
22
Mobile Internet Forecasts: GlobalMobile Internet Forecasts: Global
33
Mobile App RevenuesMobile App RevenuesGlobal Growth Applications
44
Wireless Growth Markets - IndiaWireless Growth Markets - India• CDMA-1X has coverage into Tier2/3 cities• GSM - Edge in early growth into tier 2 cities• 3G Spectrum released for Wimax
55
Internet Penetration: IndiaInternet Penetration: India
• • Overall 46% 17%• Top 4 Metros 50% 21%• Next 4 Metros 45% 14%• Other 8 Metros 44% 12%• Remaining 6 Metros 27% 9%• SEC A - 35%• SEC B - 13%• SEC C 4%
• Internet Penetration by Town class and
Socio-Economic Classification
Internet connections - Contribution to the total by Access type
March 2006
March 2007
Dial up 38% 39%ISDN 17% 19%Leased line 4% 15%DSL/Cable Link 37% 38%VSAT 1% -
• Internet Access by Access Type
As of March 2007
Business Home
66
0
100
200
300
400
500
600
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
China India
• Wireless subscriber base expected to reach 500 million by 2010 (200 million in 2006) Wireless subscriber base expected to reach 500 million by 2010 (200 million in 2006) Penetration in 2006 is 20%Penetration in 2006 is 20%
37 59106
169239
308
379
1324
44
63
79
92
103
2004 2005 2006 2007E 2008E 2009E 2010E
GSM/3G CDMA
Net-Adds(India)
32 66 83 86
Wireless Penetration 8% 13% 21% 28%
82
34%
82
41%
•Wireless Subscribers trend - •2004 - 2010 (M) Wireless Subscribers –
India vs. China (M)
China
83
150
400
232
318
482
India 2003 2006 2008F2001 2002 2004 2005 2007F 2009F 2010F
51
21
5%
31%
18%
CAGR(07-10)
Mobile Wireless MarketsMobile Wireless Markets
77
112
478
560
1,186
188
240
640
1,600
2007
612
1,076
3,540
2009
• Nokia is increasing its dominance in Music in Low Tier
• Sony Ericsson strong in High Tier with its Walkman devices
• Nokia providing pre loaded games and pushing Ngage
• Nokia and Samsung are very well positioned by providing features like SMS backup, spam filtering and IM per India requirements
• RIM and Nokia going after push email with new devices
VAS revenue from wireless in M $
All Non Voice Services Are Considered VAS in IndiaAll Non Voice Services Are Considered VAS in India
1Entertainment
Ringtone download
Games
Wall papers, logos
2Messaging
SMS
P2A – Person to Application SMS
A2P – Application to person: Email
3Others
MMS
Music Download
E-Governance
Education
HealthcareM-Commerce
88
Digital Vs Mobile Music DownloadDigital Vs Mobile Music Download
99
Devices – OpportunitiesDevices – Opportunities
• 1X is already rolled out with major coverage
• Edge, Wifi and Wimax Penetration expected to increase
1010
Laptop Growth (Global)Laptop Growth (Global)
250Mn PC’s sold worldwide in 2006
1111
Year
2% 3% 5%9%
13%
97% 98% 97% 95%91%
87%
3%
1716
2345
3124
3810
5047
6341
0%
20%
40%
60%
80%
100%
120%
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
Notebooks Desktop PC Total PC
Ove
rall
PC
Ma
rke
t S
ize
(In ‘000)
• Notebooks account for 13% PC market, up from 9% in 2005-06.
• Notebook sales grew by 97%, while growth in Desktop sales was only 19%.
Growth in 2006-07 over 2005-06
Desktop PC Notebooks Overall PC
19% 97% 26%
Notebook vs Desktop salesNotebook vs Desktop sales
1212
Notebook sales: 2001-2007Notebook sales: 2001-2007
•
• Annual sales grew by 97%; CAGR: 80%
• Households accounted for 37% of the market
growing five-folds
• Businesses accounted for 63% of the market
growing 41%
44,742 50,97488,831
177,105
431,834
850,860
0
150,000
300,000
450,000
600,000
750,000
900,000
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
Un
its
27% 21% 14% 21%31%
19%
30%26% 46% 27%
22%
25%
43%53%
40%52% 47%
56%
0%
20%
40%
60%
80%
100%
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
Small Medium Large
% U
nits
• Overall consumption in the business
grew by 41%
• Consumption in large and medium enterprises
grew by 66% and 61% respectively,
however in small enterprises it declined 10%
Notebook sales: 2001-2007Notebook sales: 2001-2007 Notebook Consumption in Businesses – Notebook Consumption in Businesses – by employee size by employee size
1313
Smartphone Vs LaptopSmartphone Vs Laptop
• Globally, Smartphones are expected to grow at 30% CAGR over next 5 years and will overtake unit sales for Laptops
• The share of the 6 OS’s is speculative • (MS, Symbian, Linux, RIM, OSX, Palm)
• Smartphone are seen as being “Really Personal”• Product Lifetime for Smartphone is <2 years
compared to a laptop which is >3 years
1414
Monitor & Flat Panel MarketsMonitor & Flat Panel Markets
1,704
2,3872,786
3,642
4,637
5,572
0
1,000
2,000
3,000
4,000
5,000
6,000
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
• Annual Growth 20%; CAGR:24%
• Consumption in smaller towns grew by 34% accounting for 60%
of market, ‘Next 4’ cities accounted for 8% of the market with a
decline was 24%
• In Top 4 cities the growth was 15% accounting for 32% of the market
• Businesses accounted for 75% while Households for 25% of the market
’00
0 U
nits
Monitor sales: 2001-2007Monitor sales: 2001-2007
3526 22
5244
1929
614
55 38
50
50
35 47
32
138
91 2 452
0
20
40
60
80
100
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
14" 15" 17" 20/21"
Monitor market by size: 2001-2007Monitor market by size: 2001-2007
• Consumption of 20/21” recorded maximum
growth of 174%; followed by 17” at 75%
• Sales of 14” and 15” declined by 47% and
9% respectively.
• LCD/Plasma tipped to capture 60% sales • Current Volumes is appx 20M p.a• LCD growth is 400% while Pl;asma is 170% p.a
Flat Panel MarketFlat Panel Market
1515
Alternate Access DeviceAlternate Access DeviceDevice Advantage Disadvantage
STB No Moving Parts
Low cost
High installed base of TV
Simple to use
Access to Internet, Email, Web Services
Communal Use in family setting helps drive exposure/drive with technology
Extendable to SOH/SME
Integrates with Telco Convergence
Untested widelly as a deplyed platform
TV Display Lacks Clarity
Uability of Keyboard/Mouse/Viewing Distance
Email/Browsing tends to be single user so a deterrent to extensive use
Battery backup difficult
Netwrok Computing Device Lowest cost $70, $10/month
Online Software Upgrades
Payt per use model
Bundeled Apps
Required Higher bandwidth
Suitable for large org with large NW PCs doing a specifci task like BPOs
Opewrator driven, Lacks user control of configutration
One Laptop per Child Uses Memory instead of Hardiosk
Can run on battery
Lowest cost of Shared Internet with Wifi
Sturdy Display usable in sunlight
Modified Rugged OS
Cost Escalation
Untested as a platform
Limaited rendering of display
Limited Applications
Limited Multimedia capability
Mobile Internet Device Personolized Internet
Always On connectivity
Push
At Hands reach allows impulsive decision making
Possibility of multiple HI
Continued Econmics of Scale
Power efficient
Small Screen Size
Difficulat Character Entry
Unable to offer Community Entertainment
Standards for OS & Apps not interoperable across Platforms
Not sauitable for SOHO/SME Biz Apps
Heavy Duty computing still a a challenge as compared to PC’s
1616
AAD - StatusAAD - Status
$100 Novatium – 2005
Monitor & Harddrive are 2 big issues
$250 XenitusZenith – 20061G Via, 40GB, 128MB, 15”
$185 Personal InternetCommunicator(PIC) AMD Canned in 2006
$220 HCL PCFor India unvlieledIn Aug2005By Maran 1G, 40G,128MB, 15”
$400 Intel Via Linux/WindowsMay 2006
$513 MS/AMD Athlon IQ PC With Zenith $3 Win+Off for EducationGovt subsidies for othersJun 2007
$260 Simputer Picopeta Amida /BE Linux Touchscreen PDA
1717
IAD Price Sensitivity MeterIAD Price Sensitivity Meter
Internet device Device+Mobile Complete bundle Internet device Device+Mobile Complete bundle
All 1692 3322 4485 1200 2750 3800
Evolved 1945 3644 4956 1300 2900 4250
Low Utilitarian 1634 3445 4848 1000 3000 4300
Passive Alien 1842 3411 4447 1400 2800 3800
Alien Aspirant 1375 2560 3061 1000 2200 2600
Reasonable price – Unaided Safe price – Price Sensitivity Meter
• Optimum price perceived to be Rs. 3,800/- for the complete product bundle … differs by segments• Aspirers, who have the highest purchase intent, perceive the optimum price of the total benefit to be Rs. 2,600/- … acceptability to be lower at higher prices• Price perception higher among the evolved set and low utilitarians
1$=Rs.40
1818
Applications for IADApplications for IAD
1919
Other Markets for IADOther Markets for IAD
2020
ObservationsObservations• Mobile Subscriber growth in India is 50% while Internet growth
is 10% p.a• IAD/AAD have not been successfully adopted in the India
market• Mobile handsets with their reach, availability, familiarity
are likely to be the primary IAD• UMPC & Tablet Form factor are important for the portfolio
as well• Price of $80 Mobile for low-end IAD with options for expansion
is a potential area of investment• E2E with Bundled Apps and Web2.0 is Key to Long term
Success - Messaging, Music, TV, Gaming, M-Comm will increase ARPU and Stickiness. Business Models and Partnerships will be Key
2121
SWOT – Large MNC’s SWOT – Large MNC’s Strengths Weakness
Opportunity Threat
• Large Scale Production• Enterprise Channel• Access to Global Markets• Engineering • Quality• Support
• New Entrant • Consumer Awareness• Relationship with Operators
• Wireless & Broadband Markets• Growth Markets• Convergence
• Cost Competitiveness• Conflict of Interest with existing customers
2222
StrategyStrategyPortfolio GTM
Product
• Ride Mobile Wave• Address Personal Home & Office space• Tap into TV market
• Leverage Enterprise S Channel• Consumer Branding• Wholesaler• Service Network• Regional Presales teams
• Create SW COE’s as differentiators• HW from ODM Initially• Acquisition for Inorganic growth
Manufacture
• Migrate to internal models when market is mature
2323
PC-Laptop-Mobile : CharacterisitcsPC-Laptop-Mobile : Characterisitcs
• CPU : Intel/AMD• Memory: 128MB+• HDisk : 40GB+• USB• BT/Wifi• MS/Linux• Player/Editor• Storage• Messaging• Email• Office• Browser• Skype/MMOIP• Gaming• Web 2.0
• Display • Battery Life • Weight• Robustness• Ergo • Multimedia• DVD
• No Hard disk • Personal Display• KB Interface• MA Connectivity• Mutltimedia• Camera• Battery• Ready • Cost & ARPU• Poor Browsing• UPA• No Printer• User Authentication
• Display• KPad/Mouse• Storage• Community Use• Interoperable Apps• Not suitable for SOHO/SME/Biz• Not suitable for • heavy computing• Battery life• Longivity > 2 years
GAPS
2424
Competition PortfolioCompetition Portfolio
• Convertible UMPC based around a • 5.6″ WSVGA touch-sensitive display• 56-key QWERTY keyboard• Weighs 1.56lbs Size 6.75″ x 6″ x 1″ • Intel A110 processor, • 1GB DDR2 400MHz SDRAM, • 945GU Express Chipset, • Atheros Super AG WLAN/Integ BT • Vista Business /Vista Home Premium• D isplay runs at 1024×600• 40GB 4200RPM 1.8″ Hard disk
UMPC $1100+
• 1.2 GHz VIA C7®-M ULV Processor • 1.0 GB DDR2 SDRAM • 40GB HDD • Ultra Slim 7 " TFT-LCD Resistive Touch • 802.11b/g and Bluetooth 2.0+EDR • Windows® XP Tablet PC Edition 2005• Or openSUSE Linux
Tablet Kiosk 7112XT $1700
Moto Q9
IPAQ 510BB8700
Nokia N90
HTC X7500
Samsung f700
3G Smartphones < $1000
Nokia N810 Tablet
Tablet $1600+
Fujitsu U810
• Windows Mobile Pocket PC "Pro edition“• 3.5-inch QVGA touch-screen• Detachable QWERTY• UMTS 2100 with tri-band GSM/GPRS• 802.11b/g WiFi, • 256MB ROM / 64MB RAM• 2 megapixel camera• SD expansion, and USB 1.1 interface• 400MHz Samsung processor • Built-in GPS navigator • Java MIDP 2.0• Stereo FM radio • Video/audio album/File manager• TV out
2525
MU
Global Smartphone ProjectionsGlobal Smartphone Projections
-20%
0%
20%
40%
60%
80%
100%
%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011YEar
OS Market Share
Other
Apple
Linux
Palm
Research in Motion
MSFT
Symbian
Smartphone Projections
0.00
50.00
100.00
150.00
200.00
250.00
300.00
350.00
400.00
450.00
500.00
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Consumer Sales (Mil)
Business Sales (Mil)
Projections by InstatSmartphone are Voice Centric, Wireless PDA are data centric
2011 Regional Share
North America
Western Europe
Asia Pacific
Central & Latin America
Central & Eastern Europe
Middle East & Africa
MU
2626
Docking
MobilePC : Example Low Cost MobilePC : Example Low Cost ArchitectureArchitecture
Intranet
Docker
Hom
e Office
Internet
ID
EE
SW
• Qwerty/Mouse• 6-10”Display• Portable
• CDMA/3GSM/Wimax• Wifi/BT/NIC• Mon/TV Out• HD/CD/SD Storage• Adjunct Processor
• MS Office• Sync & Backup• Email• Web 2.0• J2SE• Music/Video• MMOIP
Mid Tier Device
• Mid Tier Data Enabled Device for Voice+Data
• Docking Station to improveInternet User experience. ID is TBD
• Home Docker bundled with Browser/Email/MusicGaming Apps, VOIP
• Enterprise bundled withMS Office, J2SE
• Initial Launch in Growth markets