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CDMA2000CDMA2000Expanding the M2M MarketExpanding the M2M Market

Norman LindseySenior Principal ExpertHuawei Technologies (USA)March 2011

Key Attributes for a Successful M2M PlatformKey Attribute CDMA2000

Ubiquitous Coverage √√

Network Longevity √√

Low Total Cost of Ownership √√

Network Reliability √√

Enhanced Security √√

Network Capacity & Speed √√

Energy Efficiency √√

Low Latency √√

IP-based Packet Data √√

Accurate Position Location √√

Global Roaming √√

Private Network Option √√

Focus on Coverage, Longevity, Cost and MarginPage 2Source: Harbor Research, Inc., September 2010

4x

CDMA2000 Coverage: Key for M2M Services

CDMA2000 Provides Ubiquitous Coverage for Customers

Globalization & “Mobility of Things” drive need for wide coverage

The solution is CDMA2000

CDMA2000 Data Coverage MapMost M2M apps require ubiquitous coverage:

• Retail• Telematics• Health Care• Transportation• Fleet Management• Consumer Electronics• Remote Asset Tracking, etc.

Page 3Source: Aeris Communications, March 2011

Page 4Note: Based on Qualcomm simulations, coverage is defined as the maximum area with less than 1% of the users in outage;Assumption: 3GPP2 simulation frame work, embedded sector, with all 1X Advanced features including MRD, FL and RL interference cancellation, new RC

x1X Today

1X Advanced

4x 70% greater coverage enables better in-building

M2M services

4x higher voice capacityfrees up spectrum

for M2M

1X Advanced:4x capacity increase or 70% more coverage

70% coverage increase

1X Advanced Further Improves Coverage and Capacity

4x

Longevity of Revenue Streams

CDMA2000 Provides M2M Investment Protection

CDMA2000 networks and services will be around for many years

1G1G1G2G2G2G

3G3G3G

4G4G4G

Subs

crib

ers

(Billi

ons)

Source: Wireless Intelligence (WCIS+) and CDG, July 2010 Page 5

M2M Module Price ComparisonCDMA2000 modules are becoming more price competitive

Source: Harbor Research, Inc., September 2010

CDMA2000 provides a balance between cost and capabilityPage 6

Valuable Revenue Source for OperatorsMore Lucrative Business Models

• More connections → More Revenue

• Higher price per M2M bit → More AMPU

• Lower marketing costs and churn → Higher Margins

• Low bandwidth price models → More Profitability

Service Tariff Plan

Monthly fee ($ per month) Free Package Price

($/MB)

M2MPlan S 8.4 100 KB 12.9Plan M 16.8 1 MB 9.8

Data service Basic Plan 17 ~ 67 2.9 ~ 17.4 MB 3.4

(Tariff plan in Japan)

M2M service

Mobile Phonedata service

3X+

X

Price/ MB

High Margin data plans ensure CDMA2000 Success in M2MPage 7Note: AMPU – Average Margin Per User

It’s About Coverage

Tier 1 players indicating that ubiquitous coverage is criticalMany applications require national roaming capability

It’s About Longevity

M2M apps have lower device churn resulting in lower marketing and upgrade costsTechnologies with longevity are favored to minimize marketing and upgrade installation costs

It’s About Cost

Device cost is critical component to successful business caseDevices must provide balanced tradeoff between cost and functionality

It’s About Optimizing Margin

Similar to SMS business model, low bandwidth apps can provide high marginTime management of data transfer minimizes network impact improving margins

Key Metrics of M2M Success

Focus On Coverage, Longevity, Cost, and Margin

Thank youwww.huawei.com