2014 Q3 Hong Kong Mobile Market Trend and Statistics

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AGENDAHONG KONG MOBILE MARKET - MOBILE DEVICES MARKET SHARE - ANDROID/iOS SMARTPHONE, PHABLET AND TABLET SHARE

HONG KONG USER BEHAVIOR- LOCATION AND NETWORK OPERATORS SHARE - USER BEHAVIORAL PATTERNS - THE MOST POPULAR APP CATEGORY

HONG KONG SPECIAL DAYS - HKSAR ESTABLISHMENT DAY - DRAGON BOAT FESTIVAL - UMBRELLA MOVEMENT

MOBILE ADVERTISING REVOLUTION - MEDIA BUY TO AUDIENCE BUY - REVOLUTION OF MOBILE ADVERTISING INDUSTRY

ABOUTVpon Inc. founded in 2008, is the leading mobile advertising platform in Greater China. Vpon focus on the area of mobile advertising for mobile devices. With proprietary technology and operating advantages, big data processing and analysis capabilities as well as insights into mobile brand marketing, Vpon has expanded customer base to over 1000 renowned brands including McDonald's, Coca-Cola, American Express and Citibank. !With presence in over 750 cities such as Beijing, Shanghai, Guangzhou, Hong Kong and Taipei, Vpon has over 380 million unique users and has raised some US$ 10 million in a recent round of venture capital funding. With subsidiaries in Shanghai, Tokyo, Taipei and Hong Kong, The company is rapidly-growth mobile advertising platform in Asia. Vpon is one of 2014 Top 6 company which have been selected by Forbes China, and the first choice of international mobile data/marketing platform.

Vpon IN ASIA

PAN-ASIA MAINLAND CHINA. HONG KONG. MACAU. TAIWAN. SINGAPORE. MALAYSIA. THAILAND. THE PHILIPPINES. INDONESIA. JAPAN AND KOREA.

6 BILLION ADVERTISEMENT REQUESTS PER MONTH

Source: UU, Q1 2014, Vpon Inc.

Beijing

Shanghai

Hong Kong

Taiwan!

Vpon - TAIWAN

17 Millions UNIQUE USERS PER MONTH

1.7 Billions ADVERTISEMENT REQUEST PER MONTH

1,000 REPUTABLE ADVERTISERS

Vpon - HONG KONG

5 Millions UNIQUE USERS PER MONTH

400 Millions ADVERTISEMENT REQUEST PER MONTH

Vpon PROFILE

MULTI PLATFORM Support iPhone / iPad / Android / mobile website

SDK 4.2.8 Provide high CPM & CPC advertisement revenue

Comply with MRAID standard for international mobile ad

MRAID, Mobile Rich Media Ad Interface Definitions, Source: http://www.iab.net/mraid

HONG KONG MOBILE MARKET

HONG KONG MOBILE DEVICES SHARE

iPad 4.5%

iPhone 15.8%

Android 79.7%

79.7% ANDROID

• Android dominates the Hong Kong market which maintains above 75% for consecutive three quarters

Q1 Q2 Q3

20%14%23%

80%86%77%

Android iOS

ANDROID DEVICES SHARE

62.3% PHABLET •Phablets refers to display between 5” - 6.9” and a trend is observed from Q1 to Q3, Phablet share increaseS from 43.4% to 62.3% than others.

Tablet 10.6%

Phablet 62.3%

Android Phone 27.2%

Q1 Q2 Q3

11%4%11%27%40%46%

62%56%43%

Phablet Phone Tablet

SAMSUMG •remains the market leader and 8 of its phones hits top 10, its board portfolio serves the fragmented users’ behaviors

•While the jaw dropping new stars Xiaomi Hongmi Note hits top 5 within three months. While the sales performance of LG G3 is comparable to that of Samsung S5

TOP 10 ANDROID MODELS

Samsung Galaxy Note 2

Samsung Galaxy S3

Samsung Galaxy S4

Xiaomi Hongmi Note

Sony Xperia Z1

Samsung Galaxy S2

Samsung Galaxy Tab 3

Samsung Galaxy S5

5.5”

4.8”

5.7”

5.0”

Release in 2014 Apr

Release in 2014 Jun

5.5”

5.1”

5.0”

5.3”

4.3”

Release in 2014 Jul

8.0”

5.0”

PHABLET •seems to be an irresistible tide pushing toward every mobile users. 7 top 10 phones are within 5’’ - 6.9’’ screen size so as the only recent Phablet player - Apple’s iPhone 6+

•For flagships from different brands released starting in 2014Q4, Phablet will be the main stream

TOP 10 ANDROID MODELS

Samsung Galaxy S3

Samsung Galaxy S4

Xiaomi Hongmi Note

Sony Xperia Z1

Samsung Galaxy S2

Samsung Galaxy Tab 3

Samsung Galaxy S5

5.5”

4.8”

5.7”

5.0”

Release in 2014 Apr

Release in 2014 Jun

5.5”

5.1”

5.0”

5.3”

4.3”

Release in 2014 Jul

8.0”

5.0”

ANDROID OS SHARE

Gingerbread 2.1%

Ice Cream Sandwich 4.4%

Kitkat 31.8%

Older OS Versions 0.4%

Jelly Bean 61.3%

61.3% JELLY BEAN •Version 4.x has been installed by 93% users within which Jelly Bean dominates

•Andriod L, 5.0 is expected to release in Nov14, and the fragmentation of Android OS should continue

iPHONE 5S/5 •More than half(53%) of the iOS users are now using 5S and 5

• iPhone 6 and 6+ was released on 19Sep14 in Hong Kong, and the initial sales breaks the record, a quick growth of iPhone 6/6+ is expected

iOS MODELS iPhone 5S

iPhone 5

iPhone 4S

iPad mini

iPhone 6/6+

iPhone 5C

iPod Touch

iPhone 4

Release in 2014 Sep

iOS DEVICES SHARE

iPod 2%

iPhone6 2.2%

iPad 30.6%

iPhone 65.5%

31.3% iPad •The percentage share of iPad is going down across quarters, and it is expected the new iPad in Q4 will stimulate its growth

Q1 Q2 Q3

31%40%43%

iOS SHARE

iOS 5 2%

Older OS Versions 1%

iOS 6 7.6%

iOS 8 8.5%

iOS 7 81.4%

81.4% iOS7 •Since the release of latest OS in Sep 2013, most of the Apple users upgraded to the OS7. Compare to Android, it forms a more unified platform and delivers the most updated functions to users.

•According to the WWDC14, Apple announced the new iOS8, the marketing is expect it fall this year. It shall further replaces the minority iOS4, 5 and 6.

MOBILE BROWSER SHARE

Others 0%

Chrome Mobile 23.3%

Safari 27.4%

Android Browser 49.1%

49.1% ANDROID •About half of the website traffic comes from the native Android Browser. While Chrome is taking a bigger pie quarter by quarter and it may reveal that more users are switching from Safari to Chrome.

Q1 Q2 Q3

23.3%24.1%4.7%

27.4%40.6%49.6%

49.1%35.3%

HONG KONG USER BEHAVIORAL PATTERN

HONG KONG 18 DISTRICTS TRAFFIC

Wan Chai 5%

Eastern 4%

Southern 2%

Central and West 5%

Outlying 2%

Sai Kung 6%

Kwai Tsing 8% Tuen Wan

Sha Tin 9%

Tuen Mun 5%

Tai Po 5%

Northern 3%

Yuen Long 5%

Wong Tai Sin 4%

Kung Tong 6%

Sham Shiu Po 7%

Yau Tsim Mong 6%

Kowloon City 10%

51% N.T • New Territories sharing more than

half of the traffic and HKI remains steady at 16%

Q1 Q2 Q3

51%43%29%

33%39%50%

16%17%21%

HK Island Kowloon N.T

SIMPLIFIED CHINESE OS LOCATION SHARE

49% in 3 Districts •Northern, Yuen Long and Yau Tsim Mong are districts sharing top traffic which is believed to be generated by the mainland tourists

NETWORK OPERATOR SHARE

Others 0.3%

SmarTone 17.8%

Hutchison 19.5%

China Mobile 21.7%

CSL 40.7%

40.7% csl • The market is divided by the four

strong players within which CSL was merged with PCCW in July14 to become csl.

• Each of four players provides 4G LTE services

MOBILE INTERNET ACCESS SHARE

Cellular 39.6%

Wi-Fi 60.4%

60.4% Wifi • Wifi usage shows an upward trend

and the possible reason may be due to the reason that all network operator have tuned up in monthly package price of cellular data since July

Q1 Q2 Q3

39%41%44%

61%59%56%

Wifi Cellular

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Cellular Wifi

WEEKDAYS HOURLY TRAFFIC

Wi-Fi DOMINATES MOST OF THE DAY •Cellular traffic peaks at 1300 and 1800 which are the lunch and off-work hours.

•Wifi traffic peaks at 2300 which is the late-night-home-videos hours.

WEEKEND HOURLY TRAFFIC

WIFI DOMINATES IN All HOURS •Wifi peaks at 2300 and cellular weekend traffic peaks at 1700

•Wifi weekend traffic shoots higher than cellular one for all hours

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Cellular Wifi

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Android iPad iPhone

HOURLY TRAFFIC BY CARRIER

PEAK HOURS at 1300, 1800 and 2200 •Android and iPhone traffic spikes at lunch time at 1 p.m and off-work commute time at 6 p.m

•iPad traffic increases drastically from 8 - 12 p.m and in nighttime

ANDROID MOST POPULAR APP

Others 3.2%

social_network 2.0%

entertainment 49.2%

videos 15.4%

life 30.3%

49.2% ENTERTAINMENT •Apart from entrainment, life and videos categories are valuable for effective brand advertisement sharing about 45.7%

•Then it is followed by the news and life App concerning gourmet, transportation, beauty and fashion, covering 8%.

iPHONE MOST POPULAR APP

social_network 2%

news 2.8%

life 50.6%

entertainment 19.6%

videos 25.4%

50.6% LIFE •iPhone users spend most of the time in Life and Entertainment apps including gourmet, transportation, beauty and fashion.

•iPad serves a complement to iPhone for videos, while with the launch of of larger screen size iPhone 6+ may change the user behavior

iPAD MOST POPULAR APP

79.3% VIDEO •Most of iPad users download video Apps for Taiwan, Korea, China and Japan TV series or movies

•The large screen allow better video and gaming experience and therefore the two category shares almost more than 98% traffic

others 0.8%

life 0.5%

entertainment 19.4%

videos 79.3%

HONG KONG SPECIAL DAYS

HKSAR EST. DAYCENTRAL AND WESTERN DISTRICTS

MON TUE WED THU FRI

30/6-4/7 7/7-11/7

YAU TSIM MONG DISTRICTS

MON TUE WED THU FRI

30/6-4/7 7/7-11/7WAN CHAI DISTRICTS

MON TUE WED THU FRI

30/6-4/7 7/7-11/7

1/7 EST. DAY

1/7 EST. DAY1/7 EST. DAY

HKSAR EST. DAYYEUN LONG

MON TUE WED THU FRI

30/6-4/7 7/7-11/7

SAI KUNG

MON TUE WED THU FRI

30/6-4/7 7/7-11/7

NORTHERN

MON TUE WED THU FRI

30/6-4/7 7/7-11/7

TUEN MUN

MON TUE WED THU FRI

30/6-4/7 7/7-11/7

1/7 EST. DAY 1/7 EST. DAY

HKSAR EST. DAYHong Kong Overall

MON TUE WED THU FRI

30/6-4/7 7/7-11/7

1/7 EST. DAY

OVERALL TRAFFIC DROPS AND OPPOSING RESULTS FOUND IN DIFFERENT AREAS •Central and Western, Wan Chai, Yau Tsim Mong shows a 5-15% drop on the 1st July, one of the reasons may be that the two districts are the major protest/march areas, users’ mobile traffic are jammed or partially blocked during the time.

•Northern, Yuen Long, and Sai Kung shows a 3-10% surge on 1st July, one of the reasons may be that parallel goods traders was especially active on the public holiday.

10% DROP The total traffic of overall Hong Kong drops about 5% on 1st July comparing to the week after.

MID AUTUMN FESTIVAL

SAT SUN MON TUE WED THU FRI

6/9-12/9 13/9-19/9

FESTIVAL TRAFFIC UP 10% •Comparing to the week after, from Sunday to Tuesday, the Mid Autumn festival week showed an 10% surge.

•8th Sep, Monday was not a holiday and therefore the traffic is comparable to the week after

HOLIDAY, DAY AFTER MID AUTUMN

Total Traffic for 18 Districts

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

26/9(FRI) 27/9(SAT) 28/9(SUN) 29/9(MON)

UMBRELLA MOVEMENT

UNUSUAL WEEKEND TRAFFIC TROUGH 27/9 and 28/9 weekend daytime traffic was higher than that of 26/9 and 29/9 weekday traffic as it normally should be, while the traffic at the weekend evening 1800-2000 shows an unusual trough which can be attributed to the drop in traffic in Central and Western, Wan Chai and Yau Tsim Mong districts

Central & Western District

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

26/9(FRI) 27/9(SAT) 28/9(SUN) 29/9(MON)

UMBRELLA MOVEMENT

TRAFFIC HITS BOTTOM AT 1900, 28/9(SAT) The average traffic on 28/9 was lower than normal days, esp. 2 hours after tear gas was employed from 1800-2000, the reason can be that the cellular network at Admiralty was blocked and app traffic turned to Facebook which is not in Vpon network for spreading the news.

26/9, 2300, HKFS and Schloarism

occupied the govt headquarter, riot police are sent

28/9, 0000, Occupy Central officially

started,

28/9, 1600, riot police employed pepper spray

and tear gas, at Admiralty

Wan Chai District

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

26/9(FRI) 27/9(SAT) 28/9(SUN) 29/9(MON)

UMBRELLA MOVEMENT

28/9, 2300, protesters started to occupy

Causeway Bay

UNUSUALLY LOW TRAFFIC ON 28/9(SAT) Wan Chai and Causeway Bay are hot tourist destinations for shopping and its weekend traffic normally should be higher than that of weekday one. While the opposite happened on 28/9(Sun) for the whole day, and it is possibly due to the protest Admiralty where is immediate next to Wan Chai and fewer citizens localized in Wan Chai.

Yau Tsim Mong District

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

26/9(FRI) 27/9(SAT) 28/9(SUN) 29/9(MON)

UMBRELLA MOVEMENT

TRAFFIC DORPS ONLY ON 28/9(SAT) NIGHT The daytime traffic on 28/9 is comparable to other days, however the traffic was much less at nighttime. As the protest in Admiralty fermented, it caused a change in user behavior that traffic may focus on Facebook and one or two major live board-cast media and traffic on other apps were adversely affected.

28/9 2200, protesters started to occupy

Mong Kok

28/9, 1600, riot police employed pepper spray and tear gas,

at Admiralty

REVOLUTION OF MOBILE ADVERTISING INDUSTRY

AD NETWORK AUDIENCE BUY

MEDIA C

MEDIA B

MEDIA BUY TO AUDIENCE BUY •Advertisers are expecting highly accurate targeting methods for their specific audience in today’s heavily fragmented mobile audience at the best ROI.

•Given the challenge, use of data analytics to provide solid retargeting solution become crucial. A subtle evolution in the ecosystem of mobile advertising has silently begun and The tide will further push a shift of "Media Buy" to "Audience Buy".

SCENARIO TARGETING

LOCATIONTARGETING

BIG DATA ANALYTICS/RE-TARGETING

VERSATILE AD FORMAT

AudienceTargeted Audience

Individual Media in the Same App Category

Unique Value-addsfor Mobile Network Buy

MEDIA A

MEDIA D

SPECIALIZATION IN MOBILE ADVERTISING With continual evolvement of the ecosystem of mobile advertising, the existing trading elements will specialize themselves in the use of big data into different individual sub-units. Advertisers will be served with flexibility of buying media inventory through multiple supply side platforms in one integrated exchange platform.

ABOUT THE REPORT

CONTACT USWebsite：http://www.vpon.com/ !For publishers：bd.hk@vpon.com For advertisers: sales.hk@vpon.com

All data comes from Vpon Inc. !

To download the report, please go to Vpon Data Insight: http://www.vpon.com/en-us/data_report.html

Thank You!

2014 Q3 Hong Kong Mobile Market Trend and Statistics

Data & Analytics