China Mobile Edmundo Lozano Ryan Mueller April 19, 2010

Company Background Leading mobile services provider in China World’s largest mobile network World’s largest customer base: 533 mil Developer of the oPhone

Stock Information Ticker: CHL Price (May 12, 2009): $48.59 Number of Shares bought: 200 Current Price: $50.30 ◦ Shanghai Index vs CHL Shanghai Index vs CHL 52-week range: $ $59.22

Competition China Unicorn (CHU) ◦ Was granted license to operate 3G technology in China on Jan. 7, 2009 ◦ Launched 3G network on October 1, 2009 ◦ GSM and WCDMA ◦ Capabilities include fixed-line voice, broadband internet, IT services, business and data communications services ◦ Has an alliance with Apple to sell the iPhone in China

WiFi and WAPI WAPI = Wireless Authentication and Privacy Infrastructure Chinese government has not provided full specification on its encryption algorithm Techies speculate there are “backdoor” capabilities that allow government to monitor its users – consortiuminfo.org WiFi Global standard?

Industry

May 12, 2009 Q1 Profits of $3.69 billion Q1 revenue increased 9.2% 15-30% yearly annual growth Has near monopoly in China CHL has 460 million subscribers Operating Margins: 35% Very healthy balance sheet Dividend payout ratio: 43%

May 12, 2009 Sell when one or more of the following risk factors occur: ◦ Re-evaluate at $80 ◦ If China floats is currency ◦ The Chinese government does something to CHL or forces CHL to do something that is contrary to our best interests

China’s 3G Network CHL: In 9 months sold 2.3 million subscriptions: ◦ About 8519 phones/day CHU: In 1 month sold 1 million subscriptions ◦ 33,333 phones/day

Problems with TD Shortage of handsets