China mobile phone market report, presented by thinkbank market research & consulting. Mobile phone market for the entire year of 2011.

1. Dec, 2011
China Mobile Phone Market
Monthly Retail Audit Dashboard Report
博思咨询公司Beijing  Hong Kong
January,2012
HU Yang
joe@thinkbankchina.com

2. a thinkbank report
Special edition for global investment banks, PEs, VCs, hedge funds, securities etc. to watch the
trends that are shaping and will transform the future of Chinese mobile world.
Presented by retail.panel

3. Retail Data Collected from Nationwide Audit and Channel Check
3

4. …Insights Derived from Continuous Consumer Researches
4

5. Table of Contents
Size Share Product Price Subscriber
5

6. Key Figures in Dec-11
Market Size | 3G | Subscribers | Av. Selling Price
3G Sales Units in Dec-11
+11.0%M/M
2011 YTD M-size 11.6
Million
+17.3% Y/Y
Mobile phone penetration
235 Dec-11 ASP
Million Dec-11 M-size
+6.9%M/M
74 185
pct USD
20.5 +27.5% Y/Y
Million
3G subscriber new addition in Dec-11
CM=3.2M
9.6 CU=3.5M
Million CT=3.1M
6

7. Market Size Summary / 2011
235million units sold to end users, representing +17.3% Y/Y growth in 2011.
2011 Year to Date Market Size // Dec, 2011 +17.3% robust growth through 2011
235
• China mobile phone retail market size witnessed rapid
+17.3% growth in 2011, reached 235 million in 2011, up 17.3%
y/y. It’s worthy notice that market size in 2nd half of
Million units Year-on-year 2011 grew remarkably +27%, mainly driven by
smartphones, which also indicates dramatic growth
rate in 2012.
YTD Market Size Breakdown by Technology
• 3G market size increased rapidly at the shrink of 2G
2G Device Market (Million) 3G Device Market (Million) market, to 128 million or 54% of total market in the
entire 2011.
GSM 63.3(27%) TD-SCDMA 27.6(12%)
GPRS/EDGE 45.7(19%) WCDMA 49.5(21%) • WCDMA phones outperform that of TD-SCDMA &
EVDO in 2011, registered 49.5 million units due to
CDMA1X 19.0(8%) EVDO 30.0(13%)
more diversified brands and products. While TD-
SCDMA and EVDO continued to suffer from more or
YTD Market Size Breakdown by Market Type less the same problem of weak products and limited
Market Type Sales (M) Percentage % phone manufacturers.
Phones with CTA(1) 235 86.3% • White-box market encountered slowing down because
White-box (without CTA) 16.3 6.0% of 3G and smart phone growth.
Grey market(2) 21.0 7.7%
(1)CTA: Certification of Type Approval by Ministry of Industry & Information Technology
(2)Grey market: mainly smuggling phones from overseas. 7
***Market size in this report are referring to CTA market size unless there is specific notation.

8. Monthly Market Size Development
20.5 million phones sold in Dec-11, including 11.6 million 3G phones, closing the whole year with 235 million units or
+17.3% y/y growth. Market growth accelerated in the 2nd half of 2011, grew by +27% y/y.
Total Market Size Development (2G + 3G) in millions
25
2009 2010 2011
21.8 21.9
20.1 20.5 20.5
20 19.2 19.2 19.2
18.7 18.6
17.7 17.6
15
10
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Total Market (million units) 3G Market (million units)
Total Size M/M growth % Y/Y growth % 3G Size M/M growth % Y/Y growth %
20.5 +6.9 +27.5 11.6 +11.0 +122% 8

9. 3G Market Size Trend by Technology
WCDMA market size is burgeoning, accounting for nearly half of China’s 3G market as the end of 2011.
China 3G Market Size Development by Technology // 2009~Now (M units)
15
EVDO
TD-SCDMA
11.6
WCDMA 11.2
10.5 10.5
3G Total
9.6
10
9.0
8.4 8.6
WCDMA 47%
7.6
7.3
6.6
y = 0.0088x2 + 0.0256x - 0.2445 6.1
R²= 0.9925 5.2
5 4.5 4.8
26%
3.7 3.7 3.6 TD-SCDMA
3.1
2.4 2.3 2.7
1.7 1.9
1.3
27%
0.6 0.9 EVDO
0.1 0.1 0.0 0.0 0.1 0.1 0.2 0.3 0.3
0
2009 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2010 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2011 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
9

10. 2G Brand Unit Shares vs. Value Share / Dec-11
2G market holds 43% unit share in Dec-11 meanwhile captured only 25% value share due to lower ASP of 2G
phones.
2G Market = 8.9M units 2G Market = 1.4B US$
(43% of China Market) (25% of China Market)
(GSM/GPRS/EDGE/CDMA1X) (GSM/GPRS/EDGE/CDMA1X)
NOKIA Nokia
Samsung Samsung
18.2%
21.3% Gionee 1.5% OPPO
27.1% 26.5%
OPPO 2.2% BBK
1.7% Tianyu 2.6% Gionee
2.0% BBK 3.3% Lenovo
2.6%
Lenovo 4.3% Tianyu
15.7%
3.7% LG 7.1% Motorola
19.3% Motorola LG
4.7% 7.3%
ZTE 11.3% DOOV
4.9% 6.0%
6.7% Others Others
10

11. 3G Brand Unit Shares vs. Value Share / Dec-11
With 57% unit share, 3G market occupied 75% of total value share in Dec-11, Nokia still held 19.8% value share and
ranked #2 in 3G market.
3G Market =11.6M units 3G Market =2.4B US$
(57% of China Market) (75% of China Market)
(TD-SCDMA/WCDMA/EVDO) (TD-SCDMA/WCDMA/EVDO)
2.5%
Samsung 7.7% Samsung
2.9%
17.6% Huawei 3.8% Nokia
21.4%
ZTE Apple
28.3%
2.3%
NOKIA Motorola
2.6% 4.3%
Lenovo Huawei
3.3% 4.3%
Apple ZTE
5.0% 13.0% Coolpad 5.2% HTC
HTC Coolpad
5.2% 6.3%
Motorola SonyEricsson
19.8%
8.3% 11.0% SonyEricsson Lenovo
14.8%
10.4% Others Others
11

12. 3G Market Monthly Brand Market Share Development
Nokia has been losing market share for the whole year in 3G market, however, it seems that Samsung failed to grab
the opportunity. China local manufacturers ZTE & Huawei gained remarkable market share growth in 2011.
3G Market Top10 Brand Shares Development
100%= 6.1 6.6 7.6 7.3 8.4 8.6 9.0 9.6 10.5 11.2 10.5 11.6
100%
Samsung
90% 23% 19% 19% 20% 21% 21% 23% 23% 22% 21%
24% 24% Huawei
80%
9% 10% ZTE
6% 10% 11% 12%
70%
10% 11% 11% 14% 13%
5% 6% 14% NOKIA
8% 8%
9% 9% 10%
60% 11% 11% 11% Lenovo
11% 11%
50% 30% 32% 26% 10% Apple
27% 25% 20% 20% 18% 15% 12%
15%
40% Coolpad
6% 6% 4% 5% HTC
30% 5% 4% 3% 4% 5% 6% 6%
5% 6% 5%
6% 7% 8% 6% 5% 5% 5% 5%
7% 7% Motorola
20%
SonyEricsson
10% 18%
14% 11% 12% 13% 14% 13% 13% 13% 15%
11% 11% Others
0%
Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11
12

13. Brand Market Share Trend
Nokia is declining in the 2nd half of 2011 in total market, while Lenovo, Huawei & ZTE was catching up quickly. In 3G
market, Nokia was going down dramatically and Lenovo in particularly was growing dramatically in Q4.
2G+3G Market Brand Shares Trend 3G Market Brand Shares Trend
30% 10% 30% 10%
Samsung Huawei Samsung Lenovo
Nokia ZTE Apple
Huawei
Lenovo ZTE Coolpad
25%
Gionee 25% Nokia HTC
8% Tianyu 8% Motorola
Coolpad
20%
20%
15% 6% 6%
15%
10%
4% 4%
10%
5%
0% 2% 5% 2%
Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11
13

14. WCDMA: Market Size & Brand Share / Dec-11
Samsung was dominating with 25.7% m-share & 1.4 million units shipment, followed by Nokia with 20.9% m-share &
nearly 1.1 million units shipment in Dec-11.
Dec-11 M-Share
# Brand Sales K
M-Share change Coolpad,
1 Samsung 25.7% (1.9) 1397 2.4%
2 NOKIA 20.9% (5.1) 1135 SonyEricsson, Others,
3 Apple 11.0% 3.0 600 2.6% 10.5%
4 Lenovo 8.4% 1.7 457 Motorola,
5 ZTE 5.9% (0.0) 323
Samsung,
3.6% 25.7%
6 HTC 5.0% 1.0 269
7 Huawei 3.9% 1.0 210 Huawei, 3.9%
8 Motorola 3.6% (0.3) 197 HTC, 5.0%
9 SonyEricsson 2.6% 0.2 143
10 Coolpad 2.4% 1.0 130 NOKIA,
ZTE, 5.9%
11 MI 1.8% 1.8 100 20.9%
12 LG 1.7% (0.6) 95 Lenovo,
13 Tianyu 1.1% (0.1) 62 8.4%
Apple,
14 BlackBerry 1.0% 0.7 55
11.0%
15 Gionee 0.8% 0.1 45
16 OPPO 0.8% (0.1) 45
17 BBK 0.8% 0.4 43
18 Hisense 0.5% 0.3 27
19 CHANGHONG 0.5% 0.3 27
20 Dopod 0.3% (0.1) 18
14

15. EVDO: Market Size & Brand Share / Dec-11
Huawei exceeded Samsung in EVDO market and became the number 1 brand with 26.3% unit share, which can be
attributed to a range of best selling CT customized thousand-yuan Android smart phones.
Dec-11 M-Share
# Brand Sales K
M-Share change
1 Huawei 26.3% (2.8) 836
2 Samsung 22.2% (0.9) 708
3 ZTE 7.1% (1.9) 225
4 Coolpad 6.1% (1.8) 196
5 Haier 4.0% 0.5 128 Others, 21.4%
BenWee,
6 SonyEricsson 3.3% 0.3 105 2.1% Huawei,
7 HTC 2.9% (0.7) 91
26.3%
8 LG 2.4% 1.3 77 EMI, 2.1%
9 EMI 2.1% 0.9 68
10 BenWee 2.1% 0.9 68 LG, 2.4%
11 Hisense 1.9% 0.9 61 HTC, 2.9% Samsung,
12 EPHONE 1.8% 0.9 58 SonyEricsson, 22.2%
13 Motorola 1.8% (3.0) 58 Haier, 4.0%
3.3%
14 SHARP 1.3% (0.2) 41 ZTE,
Coolpad, 7.1%
6.1%
15

16. TD-SCDMA: Market Size & Brand Share / Dec-11
China domestic manufactures were jointly ruling the TD market. ZTE was the no.1 manufacturer with 24.1% and
followed by Lenovo with 16.5%, Huawei with 15.4%.
Dec-11 M-Share
# Brand Sales K
M-Share change
1 ZTE 24.1% 0.8 729
2 Lenovo 16.5% 1.5 500
3 Huawei 15.4% 0.5 468 Hisense,
4 Samsung 12.9% (0.1) 392 1.6% 1.4%
5 Coolpad 8.4% (1.8) 255
LG, Others,
6 Tianyu 4.2% 1.1 127 Gionee, 2.2% 10.9%
7 NOKIA 2.4% 0.1 71 Nokia, 2.4%
8 Gionee 2.2% 0.1 68 ZTE, 24.1%
9 LG 1.4% (1.3) 43 Tianyu, 4.2%
10 Hisense 1.6% (0.4) 48
11 DESAY 1.2% (0.9) 35 Coolpad,
12 Bird 1.1% (0.8) 34 8.4% Lenovo,
16.5%
13 Motorola 1.4% (0.1) 43
14 ASUS 1.3% 0.4 38 Samsung,
15 HTC 0.9% (0.1) 26 12.9%
16 Mastone 0.9% 0.1 27
Huawei,
17 Haier 0.9% 0.5 29
15.4%
18 SonyEricsson 0.7% 0.2 21
19 T-SMART 0.5% 0.1 16
20 SICT 0.4% 0.1 11
21 DELL 0.2% (0.2) 7
22 BlackBerry 0.3% 0.1 11
23 Dopod 0.2% (0.0) 8
24 Postcom 0.1% (0.1) 3
25 TCL 0.2% 0.1 6 16

17. 2G(GSM/CDMA) Market Size & Brand Share / Dec-11
Nokia still holds the no.1 position in 2G market with 27.1% unit share, or 2.4 million units shipment in Dec-11.
Dec-11 M- M-Share
# Brand Sales K
Share change
1 NOKIA 27.1% 0.8 2407
2 Samsung 19.3% (0.5) 1719
3 Gionee 6.7% 0.1 592
4 OPPO 6.0% 0.2 536
5 Tianyu 4.9% 0.9 437
6 BBK 4.7% 0.0 419
7 Lenovo 3.7% (0.4) 327
8 LG 2.6% (0.0) 229 Others, 21.3%
9 Motorola 2.0% 0.2 176 ZTE, 1.7% NOKIA,
10 ZTE 1.7% (0.2) 149
Motorola, 27.1%
11 Huawei 1.3% (0.2) 116 2.0%
12 Konka 1.2% (0.1) 109
LG, 2.6%
13 Bird 1.0% 0.0 93
14 DOOV 1.0% 0.0 84
Lenovo, 3.7%
Samsung,
15 Philips 0.9% (0.1) 83 19.3%
BBK, 4.7%
16 HOT 0.8% 0.7 74
17 Hisense 0.8% 0.1 67
Tianyu, 4.9%
18 Coolpad 0.7% 0.1 65
19 CHANGHONG 0.7% (0.2) 64 OPPO, 6.0%
Gionee, 6.7%
20 Koobee 0.6% 0.0 55
21 DESAY 0.5% 0.1 46
22 AUX 0.5% 0.0 44
23 Haier 0.5% 0.0 43
24 Malata 0.5% (0.1) 42
25 HOSIN 0.4% (0.1) 38
17

18. Price Tier Development
80.5% phones were sold under 1,500rmb in 2011.
Price Tier Development (2G + 3G) in CNY
>=3000 4.5% 4.8% 4.5% 5.5% 5.9% 6.5% 5.8% 7.4% 7.5% 7.0% 7.2% 6.3%
8.3%
2500-2999 6.2% 7.0% 7.9% 8.1%
8.3% 8.6% 8.8% 6.8% 6.7% 7.4%
6.7% 6.8% 7.5%
2000-2499
22.2% 21.4% 19.5%
19.9% 17.4% 17.6% 21.3% 21.5% 19.9% 19.9% 20.3%
21.3% 21.4%
1500-1999
1000-1499 16.7% 17.6% 18.7% 17.6% 19.7% 18.0%
18.9% 18.4% 17.8% 19.3% 16.7% 18.1%
17.3%
700-999
18.8% 17.6% 19.1% 15.2%
20.9% 19.7% 18.4% 17.1% 16.4% 16.2% 16.8% 15.4% 17.6%
400-699
<400
26.2% 26.3% 24.1% 22.4% 23.0% 25.4% 23.9% 24.2% 27.3% 23.8% 23.9% 24.1% 24.5%
Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 YTD
18

19. Weighted Average Retail Price Development
3G phone ASP stabilized in 2011 while WCDMA phones was apparently sold higher than that of EVDO and TD-
SCDMA phones.
Average Retail Price Weighted by Sales Units (CNY)
4000
WCDMA EVDO TD-SCDMA 2G Overall 3G Overall
3000
2000
1000
0
2009 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2010 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2011 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
19

20. Display Size and Camera Resolution Trend
Big screens and high resolution cameras were the main product trend in 2011. Phones with >4.0 screen and >3MP
or 5MP camera will be the mainstream product features in 2012.
Display Size Trend / 2009~now Camera Resolution Trend / 2009~now
4% 2% 4% 3% 5% 2% 4%
9% >8MP
>=5inch 9% 11%
25% 13% 8MP
16%
32% 17% 17%
45% 4-4.9inch 5MP
22% 20%
49%
15% 3MP
3-3.9inch 23%
11% 2MP
44% 30% 18%
2-2.9inch
22% 1MP 7%
21% 4%
300K
19% 19%
52% <2inch
42% None-cmr
29% 34% 33% 28%
20% 18%
2009 2010 2011YTD Dec-11 2009 2010 2011YTD Dec-11
20

21. Smart Phone Market
Android phones were ramping in 2011, driving smart phone penetration rate of China market grow to >30%, almost
doubled in 2011.
Smart Phone Market Size Split by OS / Smart Phone Penetration Rate
10 40%
Symbian 36%36%
35%
Android 33%
33%
Apple
8
Microsoft 29%29%
28% 30%
Others 26% 0.7
SM as % of Total 0.6
6 0.6 0.4
0.6
0.6
20%
19% 20%
0.4 0.4
4.6
4 14% 15%
14% 0.3 2.6 3.1 4.2
13% 1.7 4.0 4.2
12% 12% 12%
12% 12% 11% 11% 11% 2.1
11% 11%
11% 11%
10% 10%10% 0.2 0.2 1.4
9%
8% 8% 9%10% 10%
0.8 0.9 10%
0.3
2 0.2 0.2 0.2 0.4
0.2
0.4 0.3
0.0
0.1 0.2 0.0 0.1 0.1
0.1 0.1 0.1 0.0 0.0 0.1
0.1 0.0 0.0 0.0 0.1 2.5 2.7 2.4 2.7 2.4
0.0 0.0 0.0 1.8 1.5 1.5 1.7
2.2 2.1 2.0 2.1
1.6 1.5
1.2 1.0 1.0 1.2 1.0 1.2 1.0 1.1 1.1 1.1 1.1 1.1 1.3 1.2 1.2 1.3 1.2
0.8 1.0 1.0 1.1
0 0%
2009 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2010 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2011 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
21

22. 3G Market / Dec-11
11.6 million 3G devices sold out while 3G subscribers added 9.8 million in Dec-11, which means 16% 3G phone
users still keep with 2G services.
3G Subscriber Share by Operator (in million)
China Total Accumulated 3G subscribers as the end of Dec-11 is 128 million
Operator Dec-11 New Addition (M)
Network Technology Subscriber Device
CM TD-SCDMA 3.2 (33%) 3.0 (26%)
Operating by CU
40, 31% 51.2, 40% CT EVDO 3.1 (32%) 3.2 (28%)
Operating by CT
CU WCDMA 3.5 (35%) 5.4 (46%)
Operating by CMCC
36.4, 29% China Total 9.8 11.6
22

23. Subscriber by Operator / Dec-11
As the end of Dec-11, China registered 987 million mobile phone subscribes with around 128 million new additions in
2011. Number of total 3G subscribers reached 128 million, i.e. 13% of total.
987 million
mobile phone subscribers as the
end of 2011 in China, representing
the nationwide mobile phone
penetration rate of 74%.
Total: 199.6 million (20.5%) Total: 126 million (12.9%)
128 million
• 2G: 159.6 [80%] • 2G: 89.6 [71%]
• 3G: 40.0 [20%] • 3G: 36.4 [29%]
Accumulated 3G subs.: 32.2M of 3G subscribers, i.e. 13% of China Accumulated 3G subs.: 51M
total mobile subscribers.
Total: 649.6 million (66.6%)
• 2G: 598 [92%]
• 3G: 51.2 [8%]
Accumulated 3G subs.: 65.6M
China total subscriber and 3G new addition data are quoted from MIIT; By operator data are coming from operators’ public release. 23
Please note that There is slight discrepancies with MIIT & operator data.

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