Mobility Phones - Mobile Phones

Nearly 1.3 billion mobile users — 30% of the subscriber base — are expected to utilize local mobile search services by 2013, according to a new report from industry analysts, Juniper Research.The report argues that the best equipped regions for the delivery of mobile local search are currently Western Europe and North America, as all countries within these regions have good local digital information suppliers (yellow and white pages, city guides, restaurant and entertainment guides, traffic information, etc.) and also good mapping data (both on and off road) with good coverage of points of interest (POI).

Advertising supported local search will be the key to driving this sector according to Juniper Research, but the firm cautions that the effectiveness of advertising in this sector will vary widely according to local conditions. The availability and quality of locally based directories and content will be a key factor, as well as the presence of the necessary location based infrastructure. In the end it will be the quality of the user experience that will be of paramount importance, the report states.

Additional findings from the Juniper report include:

– Local search is expected to account for 43% of cumulative mobile search advertising revenues between 2008 and 2013

– User response rates to advertising which supports mobile local search are expected to be significantly higher than for advertising on general mobile web search

– While Western Europe currently accounts for the greatest volume of mobile search enquiries, it will soon be overtaken by the Far East & China region primarily through a surge in adoption within China itself

The report also forecasts total mobile search revenues to reach $4.8 billion by 2013 but cautions that an “advertising overload” might act as a disincentive to consumers and might ultimately limit adoption, while there are continuing public concerns over search engine usage of personal data.

Juniper Research assesses the current and future status of mobile search market based on interviews, case studies and analysis from representatives of some of the leading organisations in the growing mobile search industry.

Antenova Ltd., the integrated antenna and RF solutions company, announced the availability of two new high performing multi-band High Dielectric Antenna (HDA) embedded antennas for mobile handset and portable device applications; a 4mm low profile penta-band antenna and a six-band antenna. Antenova’s 4mm low profile penta-band HDA antenna, the industry’s thinnest five-band antenna, is ideally suited for ultra-thin mobile handsets, and the new six-band HDA antenna is ideally suited for mobile handsets, PDAs and UMPCs for the global markets.”As more and more applications are designed into devices, co-existence has become critical and board space a premium,” stated Greg McCray, CEO of Antenova. “But unfortunately, as the antenna size (volume) gets smaller, the performance decreases, so it becomes even more critical to have higher performing smaller antennas. With its’ smaller size, multi-band capabilities and lower detuning qualities, Antenova’s HDA antennas allow device designers and manufacturers more freedom in their PCB layout without having to sacrifice antenna performance and efficiencies. The low profile of our 4mm high penta-band HDA antenna enables handset manufactures to keep pace with consumer demand for smaller and thinner handsets, while the six-band HDA antenna provides device manufactures the development, cost and time-to-market advantages of designing one device for their global markets.”

Antenova’s 4mm low profile penta-band antenna covers the GSM 850, GSM 900, DCS 1800, PCS 1900 and WCDMA 2100 bands and is also suitable for CDMA/TDMA 850 and 1900. With a small volume of about 1cc and an impressively low 4mm height, this antenna is the thinnest penta-band antenna in the world and offers over 50% average terminal radiation efficiency over all five bands. The hexa-band antenna covers the same five cellular bands plus the 2.4 GHz band for Bluetooth and Wi-Fi applications, has a volume of less than 5.8cc and offers an average terminal efficiency of greater than 50% over all five cellular bands and 40% efficiency in the 2.4 GHz band.

McCray added, “Antenova has been leading the industry with its high performing multi-band HDA internal antennas for mobile handsets and portable devices. Antenova’s patented HDA antennas, through our licensee partners and customers, have been in mass production since 2004 and enable some of the most advanced wireless devices, smartphones and feature phones around the world. HDA antennas can be found in a significant number of handsets from 4 of the top 5 handset OEMs, including Motorola and Samsung, and in a multitude of handsets from ODM customers in Taiwan and China.”

Today Ericsson signed GSM expansion framework agreements with China’s two largest mobile operators, China Mobile and China Unicom, valued at about USD 1.3 billion and USD 140 million respectively. The ceremony in Beijing was attended by Chinese Premier Wen Jiabao and Swedish Prime Minister Fredrik Reinfeldt, who is in China on an official visit.China Mobile and China Unicom together provide mobile services to about 550 million subscribers in China. The expansion projects will allow both operators to boost their network capacity and performance, creating new revenue streams from enriched data services and offering an enhanced user experience.

Under the framework agreement with China Mobile, Ericsson will be one of the main suppliers of core and radio network equipment, along with related technical support and services, to expand GSM/GPRS coverage and capacity in 19 regions across China. Ericsson will also provide power-saving features that significantly reduce energy consumption in mobile networks and contribute to reducing carbon-dioxide emissions. This follows the “Green Action Program”, a Strategic Cooperation Memorandum previously signed between the two parties.

Under the agreement with China Unicom, Ericsson will be the main supplier and help expand GSM networks in 10 regions across China, including Beijing where Ericsson has previously not been a supplier. Ericsson will also supply multimedia solutions for WAP services to help provide attractive new multimedia services and applications.

The expansion projects are set to be completed in 2008. Deliveries to both operators have already started.

Carl-Henric Svanberg, President and CEO of Ericsson says: “Ericsson is continuously committed to supporting China’s rapidly expanding telecom industry with our global expertise and proven competence. The new framework agreements announced today further strengthen Ericsson’s position as the leading mobile communications supplier in the Chinese market. It reflects our vision of providing communications for all, and we are proud to be an integral part of China’s economic and social development.”

Mats H Olsson, President of Ericsson Greater China, says: “We are very excited to be carrying out these expansion projects for both China Mobile and China Unicom. It is a privilege for Ericsson to be able to work with our long-term strategic partners to provide advanced, innovative services to hundreds of millions of consumers in China.”

The ceremony was also attended by Wang Jianzhou, President of China Mobile, Shang Bing, President of China Unicom, Michael Treschow, Chairman of Ericsson, Carl-Henric Svanberg, President and CEO of Ericsson and Mats H Olsson, President of Ericsson Greater China.

Spreadtrum Communicatios, one of China’s leading wireless baseband chipset providers, today reports that China Mobile (CMCC) has announced commercial deployment of TD-SCDMA technology beginning in April. TD-SCDMA is a 3G wireless network standard developed by the China Academy of Telecommunications Technology (CATT) in collaboration with Datang and Siemens and endorsed by the Chinese government.Dr. Ping Wu, Chairman & Chief Executive Officer, said, “We are very excited with this key development in the commercialization and deployment of TD-SCDMA technology in China. Our friends, customers, and partners are also extremely pleased to see TD-SCDMA technology reach this milestone. Today’s announcement demonstrates China Mobile’s strong commitment to commercialize the TD-SCDMA technology and includes a host of measures to facilitate market acceptance of this technology including attractively priced calling plans, availability of six subsidized handset models, availability of USIM cards for consumers who purchase TD-SCDMA handsets through other channels, demo centers in eight cities, financial incentives for resellers, publicity campaigns, and after-sale customer support.

“We are pleased to see that two of our customers received over 50% of the initial round of 60,000 handset order from China Mobile in January. As additional handset orders are placed in future rounds, we believe our portfolio of TD-SCDMA products and support will enable our customers to continue to benefit from these upcoming deployments.”

Spreadtrum developed the first single-chip dual-mode TD-SCDMA/GSM baseband (the SC8800D) in 2004 and the first multi-mode HSDPA/TD-SCDMA/GSM/GPRS baseband (the SC8800H) in 2007. The company also offers a single-chip TD-SCDMA/HSDPA solution optimized for data cards (the SC8800S) and its Quorum subsidiary announced a TD-SCDMA/GSM/GPRS/EDGE RF transceiver. Spreadtrum’s TD-SCDMA solutions have also been used in the commercial products that provide MBMS support and the TD-SCDMA USB modem cards.

Motorola, Inc., a major contributor to the Third Generation Partnership Project (3GPP) Long-Term Evolution (LTE) standard, has joined the LTE/System Architecture Evolution (SAE) Trial Initiative (LSTI). This industry group is driving the acceleration of commercial and interoperable next-generation LTE mobile broadband systems through the collaborative efforts of leading telecommunications companies worldwide.”Motorola has significant expertise in OFDM-based technologies and mobile broadband innovation,” said Darren McQueen, vice president, IMS, Cellular and Broadband Network Technologies, Motorola Home & Networks Mobility. “Joining the LSTI supports our commitment from our networks and mobile devices teams to the advancement of technologies that will deliver the media mobility experiences that consumers today have come to expect.”

Motorola is leveraging its success in being among the first to deliver 802.16e commercial systems by reusing a significant amount of its WiMAX research and development, coupled with its rich heritage in cellular networking, Motorola chipsets, network and video head-end solutions, and professional services to deliver its end-to-end LTE solution.

Motorola is among the vendors selected by Verizon Wireless and Vodafone to participate in their joint LTE trials during 2008. Motorola also is planning a number of other field trials during 2008. For more details about Motorola’s LTE solutions please visit: http://www.motorola.com/lte

About LSTI

The LTE/SAE Trial Initiative (LSTI) is a global, collaborative technology trial initiative focused on accelerating the availability of commercial and interoperable next generation LTE mobile broadband systems. The Initiative was formally launched in May 2007 by leading telecommunications companies Alcatel-Lucent, Ericsson, Orange, Nokia, Nokia Siemens Networks, Nortel, T-Mobile and Vodafone. Since its inception LSTI has expanded to also include in its membership China Mobile, Huawei, LG Electronics, NTT DoCoMo, NXP, Samsung, Signalion, Telecom Italia, Qualcomm, ZTE, Rohde and Schwarz, and Motorola.

Annual revenues generated by mobile search services are expected to reach $4.8bn by 2013, according to a new report from Juniper Research.The report says that while revenue generated by data charges associated with mobile search is significantly higher than that generated by mobile advertising at the present time, the gap will close over the next five years as the relatively young mobile advertising market establishes itself. It also finds that local search services will be the most popular with advertisers, attracting 40% of mobile search adspend over the 2008-2013 period.

According to the report, adoption of mobile search services is likely to be driven by factors such as:

*Enhancements to the user interface resulting in an improved user experience while searching;

*The gradual decline of the operator-walled garden-approach;

*Reduction in data costs and increasing availability of flat rate data tariffs; and,

*The impetus provided by major search brands such as Google and Yahoo!

The report found that the China/Far East region will generate most revenues from mobile search services over the next five years, followed by Western Europe and North America.

However, the report cautioned that an “advertising overload” might act as a disincentive to consumers and might ultimately limit adoption, while there are continuing public concerns over search engine usage of personal data.

Juniper Research assesses the current and future status of the mobile search market based on interviews, case studies and analysis from representatives of some of the leading organisations in the growing mobile search industry.

“Kangxi Live Show — 2008 Thankful Heart in Loving House — Shanghai Concert” was held at Shanghai Stadium on Mar. 15, 2008. This concert was hosted by Taiwan’s popular TV hosts Dee Hsu (aka “Little S”) and Kevin Tsai, and features performances by up-and- coming young artists, such as Jolin Tsai, Alan Luo and Rainie Yang. Sponsored by Spreadtrum Communications (Nasdaq: SPRD - News), Amoi Electronics (stock code: 600057), and Kuro, the concert attracted numerous fans not only for the hot program “Kangxi Live Show” and the performing artists from Taiwan, but also for the new experience of “Mobile Music Everywhere.”Commemorative cards were presented at the “Kangxi Live Show” event and were special gifts that Kuro prepared for the Concert, which give people free membership to Kuro’s website and allow them to download 250 copyrighted songs from its huge database. People may then download these copyrighted songs to Amoi’s mobile phones, equipped with Spreadtrum’s chips, and enjoy them “anywhere, anytime.”

Dr. Ping Wu, President and CEO of Spreadtrum said, “This concert is another promotion focused on our theme of enabling ‘Mobile Music Everywhere’ and follows the joint launch in January by Spreadtrum, Amoi and Kuro of China’s first solution for music phones offering copyrighted music downloaded to the handset. By leveraging our advanced technology and innovation thinking in wireless communication, multi-media mobile chips, and customized software Spreadtrum was able to build a stable hardware platform for digital mobile music service in China and pioneer the concept of ‘Mobile Music Everywhere’.”

As a major manufacturer of mobile phones in China, Amoi is committed to bringing consumers a richer product experience. For many years, its music phones, GPS phones, and smart phone series have taken consumer requirements into account, with an added focus on differentiated experience and interactive marketing. Consequently, Amoi has succeeded in several segments of the market and gained much praise for its innovations. Now, Amoi continues that differentiated product roadmap by joining with Spreadtrum and Kuro, to integrate the whole food chain of chipsets, terminals and service, into 2008’s first key mobile terminal product — the karaoke music phone series. Besides the new music experience, Amoi will reinforce this interactive music experience with consumers through participating in more entertainment activities such as live show.

“Mobile Music Everywhere” is an integrated music service concept created by Spreadtrum and is designed for the growing number of music mobile phones used by consumers in China. Different from the other current modes of music service in China, “Mobile Music Everywhere” utilizes the convergence of the ‘4Cs’ — Communication, Chip, Content and Copyright to promote China’s music phones and copyright protected music. In January of this year, Amoi unveiled its new portable karaoke music phones, the A616 and A636, as China’s first solution for music phones offering copyrighted music, with Spreadtrum chips enabling both models. The concert highlights a new music service mode for handsets, which are based on Spreadtrum’s chips, carried by Amoi’s portable karaoke music handsets and embedded with Kuro’s service. In this service mode, the powerful chip developed by Spreadtrum enables decoding digital music, displaying photographs of celebrities and synchronizing lyrics. We can say with proud that Spreadtrum’s chip is the key to “Mobile Music Everywhere.” And Amoi’s portable karaoke music phones equipped with Spreadtrum’s chip bestow unique musical experience on users.

Spreadtrum believes that people will be able to enjoy mobile music anytime, anywhere in the near future. Spreadtrum, Amoi and Kuro will commit themselves to this project to help bring handset consumers richer musical experiences in China.

“Sharp Corp said on Friday it plans to enter China’s cellular phone market before the Beijing Olympics, as early as in June, to tap the growing affluent population there.”

Nokia announced today that a United Kingdom High Court judge issued a ruling in favor of Nokia in the action brought by Qualcomm against Nokia on 24 May, 2006. In the ruling the judge determined that all of Qualcomm’s asserted GSM patent claims are invalid. Therefore Nokia does not need to compensate Qualcomm for these patents.”We are pleased with the Court’s decision that the patent claims are invalid and believe it is consistent with and supported by the facts,’ said Rick Simonson, Chief Financial Officer, Nokia. “This is the second court to conclude that Qualcomm does not have relevant and valid GSM patents.”

In a separate case filed by Qualcomm against Nokia, the US International Trade Commission (ITC) last week decided against Qualcomm’s petition for review of Judge Luckern’s Initial Determination issued on 12 December, 2007. Judge Luckern concluded that Nokia does not infringe the three alleged Qualcomm patents in the case and that one of the patents is invalid. This ITC investigation has now been terminated.

“The UK High Court and US ITC findings are further evidence of Qualcomm overstating its position as an industry innovator and demanding compensation for patents that are not relevant or valid,” Simonson added.

Similar patents, asserted against Nokia GSM products, are at issue in separate cases filed by Qualcomm against Nokia in China, Europe and the United States. The parties have agreed to temporarily stay these patent infringement lawsuits pending court proceedings in the Delaware Chancery Court. Patent invalidation actions, filed by Nokia against Qualcomm patents in suit, continue in China and Germany.

Qualcomm has yet to prevail in any patent litigation action against Nokia despite having filed 11 lawsuits around the world over more than two years.

Worldwide sales of mobile phones to end users surpassed 1.15 billion units in 2007, a 16 per cent increase from 2006 sales of 990.9 million, according to Gartner, Inc. Mobile phone sales at the end of the year were consistent with the yearly trend, as fourth quarter sales reached 330 million units.”Emerging markets, especially China and India, provided much of the growth as many people bought their first phone,” said Carolina Milanesi, research director for mobile devices at Gartner, based in Egham, UK. “In mature markets, such as Japan and Western Europe, consumers’ appetite for feature-laden phones was met with new models packed with TV tuners, global positioning satellite (GPS) functions, touch screens and high-resolution cameras.”

“After another strong year, we expect the growth in sales of mobile devices to end users will decelerate in 2008 and fall to about 10 per cent growth as mature markets become more saturated,” added Ms Milanesi. “However, the global mobile devices market will remain relatively immune to a recession in the US and Western European economies as the majority of growth in 2008 will come from emerging markets. The mature Western Europe and North America markets are driven by operator contract terms and replacement cycles and will account for just 30 per cent of the global mobile devices market in 2008.”

Nokia achieved its long-term target of 40 per cent market share in the fourth quarter of 2007 when it sold slightly more than 133 million phones across the world. Despite some component shortages, Nokia increased its market share sequentially in all regions except North America, which remains a challenging market for the vendor. In emerging markets, products such as the 1110, the 1600 and the 2630 were in demand by consumers, while in mature markets such as Western Europe high-end phones like the N95, N82 and N73 were sought-after devices. In 2008, Nokia will need to continue to improve its portfolio, offering not only more applications and functions, but also novel designs and improved user interfaces.

In the fourth quarter of 2007, Samsung maintained second position, and although its market share slipped slightly, the gap widened between it and third-placed Motorola. Its success relied on its Ultra and Ultra II family of products. In 2008, Samsung needs to diversify its portfolio further with more form factors and colours so that single products stand out from the overall line-up.

The problems that beset Motorola in the third quarter of 2007 continued through the fourth quarter, and it recorded sales of 39 million phones across the world, taking 11.9 per cent of the market. It retained second place in terms of annual sales to end users in 2007, largely thanks to the inventory it disposed of in the first half of the year. Nevertheless, the extent of Motorola’s troubles can be seen in the 9.7 percentage-points market-share drop in its fourth quarter of 2007 result from the same period in 2006.

Sony Ericsson ended 2007 with another positive performance, growing its market share on a quarterly basis to 9.0 per cent from 8.7 per cent. Its Cyber-shot and Walkman products, such as the K850i, K610i, W910i, K550i and W300i, remained popular among consumers around the world. As Sony Ericsson widens its reach, adding features such as Wi-Fi and GPS, as well as more low-tier products, it will stay competitive in the coming quarters.

LG’s mobile phone sales totalled 23.5 million units in the fourth quarter of 2007, maintaining its 7.1 per cent market share despite the increase of more than three million in sales volumes. The success of the Viewty, the Venus and the Voyager helped LG gain brand awareness across the world as well as improve its margins. Ms Milanesi commented: “In 2008, LG will need to continue strengthening its high-end portfolio for mature markets as well as its mid tier. In the low tier, LG will increasingly be challenged by vendors such as ZTE, which has already been eroding its market share in key markets such as India.”

The market saw three new entrants into the top ten in the fourth quarter of 2007. These vendors included Research In Motion (RIM), ZTE and Apple. “On one hand, we have aggressive pricing and a focus on emerging markets (ZTE), and on the other, RIM with targeted functions and Apple with brand and design,” said Ms Milanesi.

“Phone manufacturers need to continuously adapt their portfolios to respond to operators’ demands for open platforms, lower pricing and more personalisation,” recommended Ms Milanesi. “They should also try to meet consumers’ desires for fashionable, easy-to-use phones.”

Regional Analysis

In Asia/Pacific, 112 million mobile devices were sold in the fourth quarter of 2007, representing 9.6 per cent growth over the previous quarter. Over the holiday season, operators and distributors offered a wide range of mobile phone options at reasonable prices, tempting new users to sign up to service plans. “Driving factors for growth in emerging markets in Asia/Pacific included huge numbers of new subscribers, lower-priced phones based on wideband code division multiple access (WCDMA) technology, as well as ultra-low-cost CDMA phones and low-cost global system for mobile (GSM) phones,” said Ann Liang, Gartner principal research analyst for mobile terminals, based in Taipei.

Sales in the Eastern Europe, Middle East and Africa region remained strong in the fourth quarter of 2007 and reached 61.8 million units. Mobile operators continued to add new subscribers to their networks, especially in Africa where countries such as Nigeria, Egypt, Algeria and South Africa saw healthy net new additions.

In Japan, sales to end users numbered 12.5 million units in the fourth quarter of 2007, a decrease of 3.6 per cent year-on-year. Strong sales in the early part of the year brought total sales in 2007 to a record high of 52.3 million units — more than in 2003, when many Japanese bought their first camera phones. “In 2007, music player functions and embedded TV-tuners with large, high-resolution displays persuaded users to replace their devices,” said Nahoko Mitsuyama, principal analyst for mobile communications research at Gartner, based in Tokyo.

In Latin America, sales reached 38.8 million units in the fourth quarter of 2007, a 12.5 per cent increase from the same period in 2006. “In December, the holiday season, along with accompanying promotions, meant sales hit a new record level,” said Tuong Nguyen, analyst for mobile terminals at Gartner, based in Arlington, Virginia.

The fourth quarter of 2007 was another record quarter in North America, as sales to end users continued at a rapid pace, reaching 49 million units, an increase of 9.2 per cent from the fourth quarter of 2006. “AT&T and Verizon Wireless continued to be the strongest performing operators, while Sprint Nextel lagged,” said Hughes De La Vergne, principal analyst for mobile terminals research at Gartner, based in Dallas, Texas. “Replacement devices continued to dominate sales and growth in new subscribers slowed down as penetration rates climbed.”

In the fourth quarter of 2007, mobile phone sales in Western Europe totalled 55 million units, up 2 per cent from the fourth quarter of 2006. Features such as music players, GPS and cameras proved to be significant attractions. In the same quarter, operators in Germany, the United Kingdom and France introduced Apple’s long-awaited iPhone to the market. Although sales have been small, this iconic device renewed consumers’ interest in high-end phones, which in most Western European markets are still heavily subsidised by operators.

The total value of the global mobile music market is expected to rise to more than $17.5bn by 2012, driven by rental music services and full-track downloads, according to a new report by Juniper Research.According to report author Dr Windsor Holden, “I think it’s fair to say that 2007 marked the tipping point as far as mobile music adoption was concerned. Far more subscribers began downloading and subscribing to music content in developed markets, and it must be said that that the publicity surrounding the iPhone launch undoubtedly contributed to consumer awareness of mobile music services per se.”

However, the Juniper report also argues that current prices for ringtones are unsustainable and that the market for such services may already have peaked in a number of developed markets, arguing that competitive pricing allied to a steady migration to ad-funded and/or self-generated ringtones will lead to a gradual decline in global ringtone revenues.

“With some operators now offering full-track downloads at a comparable price to iTunes, there is little justification for a ringtone retail price point that is in many cases two or even three times this level,” said Holden. “Furthermore, those aggregators whose portfolios are largely dependent upon the polyphonic ringtone will be unable to survive in the medium term unless they both rethink their pricing strategies and substantially diversify their product portfolios.”

Other findings from the Juniper report include:

The China/Far East region will remain the largest regional marketplace for mobile music services, accounting for around 43% of sales per annum over the next five years

Ringtones, which accounted for 62% of the mobile music market in 2007, will account for just 38% by 2012

The report argues that more operators should emulate the Vodafone model and introduce similar subscription-based music rental services

Juniper Research assesses the current and future status of mobile adult services based on interviews, case studies and analysis from representatives of some of the leading organisations in the growing mobile adult services industry.

“China’s government, carriers and vendors are set to spend more than 70 billion yuan on developing new wireless technology over the next dozen years.”

Yahoo! Inc. announced that it has sent a letter to its stockholders, outlining the reasons the Board believes that Microsoft’s proposal significantly undervalues Yahoo! and is not in the best interests of Yahoo! stockholders.In the letter Yahoo! says:

“(Yahoo!’s) assets - our brand and its audience, our relationships with marketers, our financial strength, our technology, and our strategic investments–are the core of our value and our leadership position in the industry.

“We have a huge market opportunity - and are uniquely positioned to capitalize on it. The global online advertising market is projected to grow from $45 billion in 2007 to $75 billion in 2010. And we are moving quickly to take advantage of what we see as a unique window of time in the growth - and evolution - of this market to build market share and to create value for stockholders.

“Today, Yahoo! is a faster-moving, better-organized, more nimble company than it was just a few months ago. We have redeployed our resources to drive Yahoo!’s key strategic priorities - taking important steps to streamline our organization and close down or scale back businesses that don’t support these critical growth initiatives. We are well on our way to transforming the experiences of Yahoo!’s users, advertisers, publishers and developers - an important shift that is at the heart of our plan to create stockholder value.”

A copy of the letter follows:

Dear Stockholders,

On February 1, 2008, Microsoft made an unsolicited proposal to acquire your company. As much has been reported in the press recently, I wanted to reach out to you personally to let you know why your Board of Directors, after a careful review by Yahoo!’s management along with our financial and legal advisors, believes that Microsoft’s proposal substantially undervalues Yahoo! and is not in the best interests of our stockholders.

Most importantly, I want you to know that your Board is continuously evaluating all of Yahoo!’s strategic options in the context of the rapidly evolving industry environment, and we remain committed to pursuing initiatives that maximize value for all our stockholders.

We have a unique combination of strengths

– Yahoo! is one of the most recognizable and admired brands in the world. We have over 500 million users (nearly 1 out of every 2 internet users worldwide). In the U.S., we are # 1 in many of the most used online services including personalized home pages, mail, news, music, shopping and travel. Because we have leadership positions in so many indispensable online services, users spend more time on Yahoo! sites than anywhere else online.

– Yahoo! is an attractive partner for marketers. Yahoo! is #1 in online display advertising, which represents 90% of the advertising inventory on the web, and we are also a leader in search marketing and a pioneer in the growing fields of mobile advertising and online video advertising. Through Yahoo!, advertisers can now connect with consumers on our owned sites as well as those of our growing network of partners including eBay, Comcast, AT&T, a consortium of over 600 newspapers, Forbes.com, Cars.com, WebMD and more.

– Yahoo! has the financial flexibility to execute our plans, thanks to our healthy cash balance, which exceeded $2 billion as of December 31, 2007, and our substantial operating cash flow, which we expect to grow double digits in 2009.

– Yahoo! has made important investments in our core computing infrastructure enabling us to dramatically increase the speed of our search engine updates even while handling vast and growing quantities of data.

– In addition, we have the added value of our substantial, unconsolidated investments in Japan and China. We have substantial positions in Yahoo! Japan, the leader in its market, and Alibaba, which is strongly positioned in China, a market with enormous growth potential.

These assets–our brand and its audience, our relationships with marketers, our financial strength, our technology, and our strategic investments–are the core of our value and our leadership position in the industry.

We have a huge market opportunity - and are uniquely positioned to capitalize on it

The global online advertising market is projected to grow from $45 billion in 2007 to $75 billion in 2010. And we are moving quickly to take advantage of what we see as a unique window of time in the growth - and evolution - of this market to build market share and to create value for stockholders.

We are executing our strategy - and making headway

We have taken significant but disciplined steps to refocus our business on our objectives to become the starting point for the most consumers and the must buy for the most advertisers and enhance Yahoo!’s long-term performance.

Starting Point Objective: Our goal is to grow visits to key Yahoo! starting points and properties, where users enter the Internet, by 15% per year over the next several years. We are the most visited site in the U.S., and we continue to grow - we experienced double-digit growth in U.S. users in 2007 on our Yahoo.com home page.

In addition to traditional starting points on the PC - including our home pages, mail, My Yahoo! and search, we are particularly excited about our growth prospects in mobile, the biggest emerging starting point in the world. Globally, there are twice as many users of mobile devices as users of personal computers, and mobile advertising is projected to grow substantially in the coming years. We have an important competitive edge as the number one mobile destination in the U.S., and we are building a superior mobile experience for Yahoo! users globally so we can further capitalize on this opportunity.

Must Buy Objective: We are working to make online advertising easier and more effective for marketers, opening up new ways for them to connect with consumers. We’ve successfully completed the global roll-out of our search marketing system, Panama, which improved the search experience for our users, boosted returns for our advertisers, and increased revenue for Yahoo!. Last year, we bought Right Media, an exchange that enables buyers and sellers of online advertising to come together. Another 2007 acquisition, Blue Lithium, brings us best-in-class performance marketing capabilities, complementing Yahoo!’s existing offerings for advertisers. We also integrated our search advertising and display advertising sales forces, creating a one-stop shop for all of advertisers’ online marketing needs. All of these - Panama, Right Media, Blue Lithium, and our combined sales efforts - complement and enhance Yahoo!’s existing capabilities and will make it easier for advertisers and online publishers to buy and sell advertising online.

We are also creating a unique and valuable network of premium websites to serve our advertisers. We are making it easier for our advertisers to provide interesting and relevant offers to our users by combining advertising space on Yahoo!’s owned sites with that from a growing group of premium partners including eBay, Comcast, AT&T, a consortium of over 600 newspapers and many others.

As we reach more users both on our own websites and on the sites of our premium partners, and better monetize the ad space on Yahoo!’s owned and operated sites, we are striving to increase the percentage of total online advertising demand we touch from an estimated 15% in 2007 to 20% over the next several years.

These key strategies will be enhanced by our adoption of new, more open technology platforms that will encourage the development of new applications and the involvement of third-party developers - and help enrich the user experience.

We have accomplished a great deal in a very short time - and we are focused on building this momentum

Today, Yahoo! is a faster-moving, better-organized, more nimble company than it was just a few months ago. We have redeployed our resources to drive Yahoo!’s key strategic priorities - taking important steps to streamline our organization and close down or scale back businesses that don’t support these critical growth initiatives. The fact is that we are well on our way to transforming the experiences of Yahoo!’s users, advertisers, publishers and developers - an important shift that is at the heart of our plan to create stockholder value.

I want you to know that the Yahoo! Board of Directors and management team remain committed to pursuing initiatives that maximize value for all our Yahoo! stockholders. This is a great company and we are moving quickly to make it even better.

Jerry Yang

Alcatel-Lucent today announced plans to develop and distribute a prepaid option to operators in the wireless market for use with the BlackBerry platform.Customized for BlackBerry smartphones, the real-time, volume-based charging solution will be hosted by Alcatel-Lucent and will seamlessly integrate with operators’ existing networks. This option will enable BlackBerry smartphone users to track the minutes and data they have used against the prepaid amount remaining in their account so they can easily refill their account as needed.

“In line with Alcatel-Lucent’s strategy to provide extensive expertise in managed communication services, we are proud to develop and provide customers with prepaid options for BlackBerry smartphones. We hope this solution will enable more operators in high-growth economies to greatly expand their business opportunity”, said Michel Rahier, President of Alcatel-Lucent’s Carrier business.

“We are proud of the work that has been done in partnership with Alcatel-Lucent to bring the BlackBerry solution to new markets and we look forward to expanding this relationship,” said Jim Balsillie, Co-Chief Executive Officer at Research In Motion. “We believe a prepaid option enabled by Alcatel-Lucent will add significant value for our operator partners and further broaden customer interest in BlackBerry smartphones.”

The partnership between Alcatel-Lucent and RIM has already led to distribution of the BlackBerry solution in several countries across Eastern Europe, Africa, the Middle East and Asia, including China, the world’s largest wireless market.

ZTE, a leading global provider of telecommunications equipment and network solutions, is demonstrating the company’s newly IOT (Inter Operability Testing) tested 5.76Mbps HSUPA (High Speed Uplink Packet Access) network equipment at the GSMA Mobile World Congress Barcelona 2008, Spain. This follows the successful launch of ZTE’s 7.2Mbps HSDPA/2Mbps HSUPA network equipment at China’s PT/Wireless & Networks Comm exhibition in October last year.HSUPA is a UMTS uplink enhancement technology introduced in 3GPP R6. It has two phases: in phase I the maximum uplink data throughput is 1.9Mbps; in phase II the maximum data throughput is up to 5.76Mbps. HSUPA technology increases capacity and throughput, and improves spectrum efficiency as well, satisfying the growing demand for mobile services in wireless broadband networks.

“We are proud to have completed the 5.76Mbps HSUPA IOT with terminals using Qualcomm chips,” said Fang Hui, ZTE’s General Manager of WCDMA Products. “Our ability to launch the solution at the MWC show further validates our industry leading technology expertise in the HSPA field.”

ZTE’s extensive HSPA R&D programme led to the company’s initial deployment of HSPA in 2004 which featured the foundations of a smooth upgrade path enabling seamless hardware development. This was followed in 2006 by the deployment of 14.4Mbps HSDPA and in 2007 of 7.2 Mbps HSDPA/HSUPA. At the same time ZTE successfully carried out initial IOT tests and implemented interoperability partnerships with other major telecoms equipment vendors.

ZTE’s end-to-end HSPA solution features all-rounded HSPA commercial solutions, HSPA commercial terminals, data cards and HSPA simulating platform software. Today, ZTE’s HSPA technology has been widely deployed across 30 countries and regions including Europe, Asia, and Africa.

“The departure of the biggest domestic brand, with 6% of the market, underlines the heated competition in China’s overcrowded cellphone sector.”

mInfo Inc., the leading Chinese mobile search provider, is releasing some key search statistics that shed light on real user behavior and the state of the sector in the world’s largest wireless phone market. With the popularization of wireless search in the last couple of years, China’s wireless search market has developed rapidly starting from 2006. Many consumers have begun to touch on and enjoy the benefits of wireless search services. The industry value chain and roles of the mobile search providers, mobile carriers, handset manufacturers, ad agencies and mobile advertisers have all become much clearer.Although some new players entered the market in 2007, there was also a shake out of the less competitive firms who focused solely on WAP (Wireless Application Protocol) for delivering their services. The delays in 3G license issuance and network deployment combined with new carrier data pricing/access policies have caused considerable strain on these firms as active WAP users actually decreased from 2006 levels. Fortunately, users found alternative means of accessing the information they needed. According to iResearch, the number of mobile search users grew to 61 million by the end of 2007, and is forecasted to reach 117 million by 2008 and to over 200 million by 2010.

As the only mobile search provider in China offering cross-platform services via SMS, WAP, instant messenger (IM) and on-phone applets, mInfo was certainly a beneficiary of this shift in the market. Even in the US market where 3G has already been deployed for several years and SMS adoption is much lower than in China, last month Nielson released a report stating that the US SMS search user base is almost twice the size of the US WAP search user base. In a market like China where SMS and Mobile IM adoption are both significantly higher than WAP adoption, the need for multi-transport mobile search services is clear.

“With the amount of user behavioral information we see each day, mInfo has a unique view into the habits and cultural trends of the Chinese people,” said Alvin Wang Graylin, CEO. “This level of insight allows us to provide more relevance to our users in their search results and continue delivering new informational services they really want. In this market where 85% of the population hasn’t used a computer, mInfo’s mobile search is bringing the benefits of on-demand information to the masses.”

The top five search topic categories for 2007 were:

1. Dining/Entertainment

2. Stock/Financial

3. Ring tones/Pictures

4. Weather/Travel information

5. Leisure/Recreational Content

Compared with 2006, Dining/Entertainment is still the most popular search topic, but Stock/Financial searches have jumped from fourth place into second, with a traffic increase almost eight times greater. This is certainly not surprising given the mass interest in the financial markets after another year of over 100% growth.

The data showed some interesting trends, like that SMS and IM users had a greater tendency to do Local and Informational searches, whereas WAP and applet users tended to do more rich content searches. SMS and IM users were also more geographically diverse having a greater spread of users across a broader set of cities compared to WAP users, which were overrepresented in the Guangdong province. Since mInfo also operates the leading English language mobile search service in China (Guanxi), it has some unique views on the behavior of English-speaking foreigners in China. Foreign mobile search users were on average twice as active as Chinese users and tended to focus more on Local Search instead of other categories of services. They also tended to be on average older and had a larger proportion of professionals and executives than the Chinese user base.

mInfo also found that the query model for mobile search is quite different from web search. Mobile searchers tended to use query phrases (5-6 words/query) compared with web searchers who on average used about one to two keywords per query. We find that mobile searchers tend to input phrases with qualifiers to improve specificity in an effort to increase relevance and get more precise answers in a shorter amount of time. mInfo’s unique natural language search capabilities are perfectly suited to this type of user behavior. mInfo’s able to decipher the intent of semi-complex user queries and provide highly relevant answers and not just a long list of potentially relevant links. This allows users to find what they are looking for in just 1- 2 steps as opposed to the iterative search refinements and numerous clicks needed to complete a traditional Web or WAP search session.

mInfo’s registered users increased by over 100% compared with 2006, a significant portion of which were coming from the younger part of the population. Users under the age of 25 comprised about 50% of total users with students accounting for over 28% of users. This is fairly consistent with the early technology adopter profile of this user segment. Data also shows a healthy mix of white-collar workers/professionals who comprised over 32% of total users. This statistic is higher than what most wireless sites/services see, but hardly surprising for mInfo since it targets many services specifically to this market segment. The three key coastal markets of Shanghai, Beijing and the Pearl River Delta region, accounted for almost half of mInfo’s users. The mix between male and female are fairly even at 53% and 47% respectively.

“Based on user growth and increased interest from advertisers, mobile search and mobile advertising are definitely trends for 2008 and beyond,” said Alvin Wang Graylin, CEO. “mInfo is proud to be in the forefront of this exciting space and playing a critical role in setting its direction at such an important time in the life cycle of this new media in China.”

The worldwide mobile phone market passed a new milestone in shipments by recording over 300 million devices shipped during the fourth quarter, while experiencing slower year-over-year growth for 2007. According to IDC’s Worldwide Mobile Phone Tracker, the 334.0 million handsets shipped during the holiday quarter was a new record for the industry, and was up 15.3% over last quarter.For the entire year, total shipments reached 1,144.1 million units in 2007 with 12.4% overall growth. Nokia once again led vendors in shipments throughout the year, although some shakeup in the vendor rankings did occur. Samsung, which had been the number three vendor in the industry, surpassed Motorola during 2007 to capture the number two spot.

“Give credit to Samsung for taking the number two position worldwide from Motorola,” says Ramon Llamas, research analyst with IDC’s Mobile Devices Technology and Trends team. “For the past few years, Samsung’s growth kept pace with the market, but in 2007 the company beat the market almost by a factor of four. Samsung capitalized on replacement handset opportunities in the United States and Europe with a steady stream of mid-range and high-end devices while Motorola spent much of the year addressing inventory challenges across EMEA and Asia. Now that Motorola is implementing a new handset strategy, it will be interesting to watch the hotly contested number two position in 2008.”

“Over the last three years, growth in the industry during the holiday quarter has fluctuated from 18.0% to 30.0%, and this past quarter we saw it drop to 11.6%,” said Ryan Reith, senior research analyst with IDC’s Worldwide Mobile Phone Tracker. “The expectation that the market would maintain the level of growth it saw over the last three years was unrealistic. We expect growth to be in the single digits throughout 2008, and most likely for years to follow.”

Top Five Mobile Phone Vendors

Nokia shipped more units in the fourth quarter than the next three vendors’ shipment volumes combined. This, Nokia executives pointed out, was the result of its streamlined operations, which produced on average nearly 1.5 million units each day during the quarter. This number could have been even higher if the company did not have to deal with component shortages during production. Regardless, it still marks a significant accomplishment. Nokia’s volumes were primarily driven by entry level products from its 1100 and 1200 device families, but its biggest revenue and profit generators came from its premium Nseries devices.

Samsung achieved several noteworthy accomplishments to end 2007: It took the No. 2 position worldwide for the year, posted its third consecutive quarter as the No. 2 vendor worldwide, and recorded its sixth consecutive quarter of shipment growth. In the process, Samsung realized double-digit profit margins during the quarter, resulting from an emphasis on its premium Ultra Edition phones and converged mobile devices. Looking ahead to the first quarter of 2008, the company plans to top its 46.3 million shipment volume while maintaining profit margins.

Motorola spent another quarter addressing its challenges, the most significant being a slowing demand for Motorola’s products. CEO Greg Brown pointed out that the company had missed out on significant growth areas, most notably in 3G, China, and emerging markets, and that gaps in Motorola’s current product portfolio had to be addressed. Recent announcements of its ROKR E8, Z10, and W series reflect Motorola’s attempts to revive its handset business, but recovery is expected to continue into 2009.

Sony Ericsson broke through the thirty million unit mark for the first time in its history. As in previous quarters, EMEA represented the bulk of the company’s shipments, but it also improved its presence in North America, Latin America, and Asia Pacific. Even with greater attention and resources going towards emerging markets, Sony Ericsson still recorded the highest ASP among the leading vendors. Key devices for the quarter included the K550, W200, W300 and the W580.

LG Electronics took another step towards breaking the 25 million mark, and with the success of premium devices in developed markets and cost effectiveness, the company also realized slight operating margin improvement. Key to its success were several models released during the quarter, including the Voyager and Venus in the United States, and the Viewty in Europe. Despite its positive results during the quarter, LG saw the distance between itself and Sony Ericsson grow to more than seven million units, reversing the progress it had made in previous quarters.

picoChip announced today the PC8808 TD-SCDMA femtocell reference design, the first to support this standard. Femtocells (or 3G access points) are low-cost basestations optimized for deployment inside buildings to improve coverage and data rates. The new design was developed in China at picoChip’s Beijing design center. TD-SCDMA is the third major 3G standard, and is expected to launch in the Olympic cities this summer.Mr. Yang Hua, the secretary general of TD-SCDMA Industry Alliance, said, “Femtocells are an important part of the TD-SCDMA ecosystem, and an essential part of operator strategy, particularly as we evolve to TD-SCDMA LTE. picoChip’s achievement significantly pushes the TD-SCDMA industry forward.”

Stuart Carlaw, Research Director ABI Research, added, “Femtocells help carriers solve problems of both coverage and capacity which are applicable to all standards, including TD-SCDMA. Given how good coverage already is in China for mobile services, consumers will expect excellent indoor services too: something that is particularly important for data, which is already in high use in the region. For both these reasons, I’d expect TD-SCDMA femtocells to be later in deployment, but to ramp as fast if not faster than those for WCDMA. picoChip is the leading provider of femtocell chips, and once more demonstrates this position of leadership with its software-defined architecture.”

With this introduction picoChip now supports all three 3G standards families: WCDMA (HSPA) through the picoChip PC8208/8209, cdma2000 via GWT partnership, and now TD-SCDMA with the PC8808. picoChip also supports WiMAX Waves 1 and 2 with its PC6530 and PC6532 single chip reference designs respectively.

“picoChip clearly recognises the benefits of exploiting the globalised business world. The exciting new products were developed by picoChip jointly in Bath and Beijing, but are in high demand from customers world-wide,” said Andrew Cahn, chief executive of UK Trade & Investment. “picoChip’s joint ventures with its Chinese partners, and also with the Olympics later this year, demonstrate the real opportunities that exist in China for British businesses.”

The PC8808 TD-SCDMA femtocell reference design supports HSDPA and is the industry’s lowest cost complete solution. The picoChip single-chip platform can integrate both Node B and protocol stack, and can easily integrate back into the core network using a number of different architectures including SIP, UMA or Iu.

“This announcement is a further example of picoChip’s continuing commitment to the Chinese market and this is the first product to be wholly developed locally at our Beijing Design Center. It follows hot-on-the-heels of the recent partnership announcement with Xinwei for the implementation of its McWILL network, to be deployed for the Olympics,” said Guillaume d’Eyssautier, president and CEO picoChip, recently named to GSA EMEA Leadership council. “We aim to continue this momentum as we further support Chinese wireless development.”

The single-chip PC202-based design is software defined and delivers baseband complete with upper layer software stacks included. It is based on the same architecture as the PC8208/HSDPA and 8208/HSUPA platforms.

picoChip is the leading supplier of multi-core DSP delivering extremely high performance at competitive cost points. It offers a powerful platform to develop products for emerging global wireless communications markets such as WiMAX, LTE, McWILL, TD-SCDMA and 4G. picoChip’s products scale from femtocell access points to sophisticated multi-sector carrier macrocells.

In addition to TD-SCDMA femtocells, picoChip is recognized as the leading silicon supplier in WCDMA/HSPA femtocells, and is involved in most of the current operator field trials. Customers include ipAccess, Ubiquisys and other undisclosed leading manufacturers. picoChip is a founding member, and is on the executive board, of the Femto Forum.

picoChip is attending the China Business Summit in Beijing organised by UKTI on 18 January 2008.

“Apple Inc. and China Mobile have called off talks to launch the U.S. firm’s popular iPhones in China, dashing investor speculation that the device will hit store shelves soon and sending China Mobile shares down.”