Huawei bridges the success of Western Developers into China Key Insights on the Mobile User & App Ecosystem in China Dr. Jaime Gonzalo VP Consumer Cloud Services EU Droidcon, Berlin, September 2017 华为开发者联盟 LOGO

World’s Biggest Mobile Market 1. China’s Mobile Boom World’s Biggest Mobile Market

2017: China Smartphone Penetration Will Surpass 50% 2017 smartphone users; 881M in 2020 1.4Bn Chinese consumers in 2017; 1.5Bn in 2020 19% SHARE OF GLOBAL 29% Source: Newzoo | 2017 Global Mobile Market Report

Global App Revenues Grow to $85Bn in 2020 Last Year, China’s App Revenues Surpassed US $16Bn 2017 app revenues $26Bn in 2020 29% SHARE OF GLOBAL 31% 71% of smartphones used is Android Source: Newzoo | 2017 Global Mobile Market Report Global App Revenues Grow to $85Bn in 2020

From Communication to Innovation 2. Chinese Mobile Life From Communication to Innovation

Focus of Consumers Shifts to Quality and Innovation Device Quality: Budget for Mobile Devices Soars as consumers upgrade from their previous model Source: Newzoo/TalkingData | 2016 China Mobile Internet Annual Review DECEMBER 2015 2016 1-999RMB 1,000-1,999RMB 2,000-3,999RMB > 4,000RMB Huawei highest acquisition rate (3x Samsung) Huawei highest retention rate (2x Samsung) in the market*. *Measured by share of active users that replaced its mobile device in the period November 2016 to January 2017 Source: Newzoo/TalkingData | 2016 China Mobile Internet Annual Review

increase in downloads of shopping apps in 2016 versus 2015 in Shopping Happens on Mobile First 56% of Chinese online consumers* predominantly use their phones for shopping online. China Is Global Leader in Mobile Shopping share of consumers* that mainly use mobile to shop online U.S Germany India China Russia +196% increase in downloads of shopping apps in 2016 versus 2015 in HiApp. TOP 5 SHOPPING APPS IN HIAPP IN APRIL 2017 *Chinese consumers defined as Tier 1 & 2 users aged 10 to 65 who have access to the Internet, April 2017 Source: Newzoo | 2017 China Consumer Insights, April 2017 Source: Huawei | HiApp Data Center *Chinese consumers defined as Tier 1 & 2 users aged 10 to 65 who have access to the Internet, April 2017 Source: Newzoo | 2017 China Consumer Insights, April 2017 Source: Huawei | HiApp Data Center

Paying with Your Phone Is the Standard 70% of Chinese online consumers* prefer to pay with mobile wallets when in shops. China Is Global Leader in Mobile Wallets share of consumers that prefers to pay with mobile: 2.5X the U.S U.S Germany India China Russia +452% increase in the number of people using HiWallet between 2015 and 2016. *Chinese consumers defined as Tier 1 & 2 users aged 10 to 65 who have access to the Internet, April 2017 Source: Newzoo | 2017 China Consumer Insights, April 2017 Source: Huawei | HiWallet Data Center Source: Newzoo | 2017 China Consumer Insights, April 2017

China As An Opportunity 3. China As An Opportunity Proven Success by Western Companies

was the market value of Didi at time of the acquisition. Uber’s Success in China Sparked an Acquisition $28Bn was the market value of Didi at time of the acquisition. Uber Outperformed Didi in Growth in the months before the acquisition in August 2016 20% stake in Didi is what investors in Uber and UberChina received to hand over its operations. GROWTH IN MONTHLY ACTIVE USERS IN JULY 2016 +2% +23% Source: Newzoo/TalkingData 2016 | China Monthly Mobile Market Update | TalkingData App Data Center Source: Wall Street Journal

Airbnb Western Experience Success in China China Has the Second Most Downloads of Airbnb on iOS 13% of monthly downloads in April 2017 come from China U.S U.K South Korea China France 100M+ ACTIVE USERS OF AIRBNB WORLDWIDE 650K+ AIRBNB HOSTS WORLDWIDE Source: Newzoo/PrioriData | Global Apps Store Intelligence Source: 90 amazing Airbnb stats and facts (March 2017)

Chinese gamers like Western content Top 10 Grossing Games on Android Devices in China independent of distribution channel or android store (Dec 2016) Share of Western Games in Top 100 Grossing Games in terms of number of titles and share of revenue (Dec 2016) Rank Name Publisher Game Genre Release MAU (M) 1 Onmyoji  NetEase Role Play 2016Q2 6.6 2 King of Glory Tencent Action 2015Q3 21.2 3 Fantasy Westward Journey 2016Q1 3.3 4 Ghost Story 2.4 5 Anipop Happy Elements Casual 2013Q4 39.6 6 Clash of Clans Supercell Oy Strategy 2012Q3 4.3 7 Happy Lord Casino 11.3 8 Hearthstone Cards 2014Q1 1.4 9 Miracle Nikki 2015Q2 1.3 10 Temple Run 2 iDreamSky Casual (Parkour) 13.0 7/100 GAMES ARE WESTERN 2% OF REVENUES BY WESTERN GAMES 16/100 GAMES ARE WESTERN 15% OF REVENUES BY WESTERN GAMES #6 #8 #10 #11 $10Bn TOTAL MOBILE GAME REVENUES IN CHINA IN 2017 Source: Newzoo/TalkingData | China Monthly Mobile Market Update | TalkingData App Data Center Source: Newzoo | 2017 Global Games Market Report Source: Huawei | HiApp Data Center Source: Newzoo/PrioriData/TalkingData | Global App Store Intelligence | TalkingData App Data Center

Understanding The Ecosystem 4. Understanding The Ecosystem Navigating towards Success

China’s Colourful App Store Ecosystem The Android Ecosystem Consists of Numerous Stores owned by various media companies and device brands 360 Mobile Assistant MyApp (Tencent) Baidu Wandoujia (Alibaba) China Telecome Tianyi Store China Mobile Market PP China Unicom Wo Store PRE-INSTALLED OEM APP STORES Huawei HiApp OPPO App Store Vivo Xiaomi THIRD-PARTY APP STORES CARRIER APP STORES AND MORE… Source: Newzoo/TalkingData | Reference Guide to China’s Mobile Android Ecosystem 45Bn DOWNLOADS FROM HUAWEI HIAPP STORE IN 2016 *Defined as an aggregate of the individual market shares of Huawei, Xiaomi, OPPO, and vivo app stores amongst all Android users Source: Newzoo/TalkingData | China Monthly Mobile Market Update Source: Huawei | HiApp Data Center

Huawei as Partner: Supporting 240,000 Developers Worldwide Developer Tools Consumer Interfaces Developer Alliance APP Test Huawei ID Huawei Push Smartphones Tablets VR Devices Wearable Devices Developers Consumers Pressure Sensing Dual Camera IAP Huawei Themes Game Center App Market $400M paid out to developers in 2016 alone. App Develop / Test Distribution Monetization

annual fund to support the success of developers in China. Huawei as Partner: Marketing, Monetization & Investment $30M annual fund to support the success of developers in China.

JOIN US Dr. Jaime Gonzalo VP Consumer Cloud Services Europe Huawei 华为开发者联盟 LOGO Website: developer.huawei.com/ consumer/en/register/regContry.html Email: developerEU@huawei.com