Smartphone growth is rapidly slowing meaning that one should look to the ecosystems for growth China Smartphone, Tablet and Ecosystem forecasts 2013A-2017E, Units (m), % growth YoY Smartphone shipments (m) Growth Tablet shipments (m) Growth 74% 439 454 462 67% 430 21.5 353 19.1 18.1 17.7 17.2 LOW / NO 25% GROWTH 22% -5% -2% 2% 3% 2% -11% 2013A 2014A 2015A 2016E 2017E 2013A 2014A 2015A 2016E 2017E Ecosystem users (m) Growth 812 864 93% 739 659 Baidu, Tencent, MID LEVEL 508 Alibaba exposed to GROWTH users will fare better than Apple, Xiaomi and other handset 30% makers 12% 10% 6% 2013A 2014A 2015A 2016E 2017E Source: Radio Free Mobile, Counterpoint Research www.radiofreemobile.com 20