Slide 1: January 2011 Investor Presentation
1 NASDAQ: UTSI January 2011 Investor Presentation
Slide 2: Disclosure & Forward Looking Statements
2 Disclosure & Forward Looking Statements This investor presentation contains forward-looking statements, including statements regarding the Company's strategy to reduce operating expenses, ability to achieve profitability, investment in selective products and certain geographic regions, diversifica
Slide 3: Agenda
3 3 Agenda Corporate Overview 1 Financial Overview and Outlook Growth Strategy & Market Dynamics 2 3
Slide 4: Corporate Overview
G@srarcom Corporate Overview
Slide 5: Company Introduction
5 Company Introduction A leading provider of interactive, IP-based network solutions for IPTV, Internet TV and Broadband operators in the cable and telecom sectors Technology and services expand and help modernize communications networks, giving operator customers the capability to provide their sub
Slide 6: Investment Highlights
6 Investment Highlights Focused on achieving breakeven in 2011 Strong existing relationships with leading telecom, cable and media players in China and across the rest of Asia Well positioned to benefit from China’s Three Network Convergence policy and development Diversifying into high-margin opera
Slide 7: A Seasoned Leadership Team
7 A Seasoned Leadership Team Name and Title Experience Jack Lu CEO & President Seasoned leader with strong operational credentials and more than 25 years leading companies in China’s telecom & optical electronic sector Held numerous positions at Fiberxon including CEO, COO and Vice President of Mark
Slide 8: Major APAC Clients
G@srarcom Major APAC Clients cHINA TELECOM CNIN BosIV Sh Pam seee ame Connecting the World unicomP Ela www.cntv.cn www.cctv.com ; > Wy SMC B27 sree eee wT _ Qvecasnge “OD opm CS Sur esenspeseea = SoftBank NEC sromeesrymoaon SF Page €oPLDT WOr KT Wyner SK Telecom most ¥ sluable Company ~<@ EBT @ Bhar
Slide 9: RollingStream Technology Solution and Value to Customer
9 SOLUTION AND VALUE TO CUSTOMER PRODUCTS OR SERVICE PROVIDED TARGET CUSTOMERS RollingStream® Technology: provides customers market-leading interactive TV solutions RollingStream enables operators to provide IPTV, iDTV, Internet TV, mobileTV, video information and other industrial applications. Hard
Slide 10: Broadband and NGN Solutions
10 Broadband and NGN Solutions SOLUTION AND VALUE TO CUSTOMER PRODUCTS OR SERVICE PROVIDED TARGET CUSTOMER Broadband Solution: provides high bandwidth network infrastructure for communications networks PTN MSTP G/E-PON 1.Telecom operators 2. Cable operators NGN Solution: Provides a multi-service IP-
Slide 11: Growth Strategy and Market Dynamics
11 Growth Strategy and Market Dynamics
Slide 12: Our Positioning and Growth Strategy
12 Enables focus on Chinese and Asian markets where network build out drives our business Leverage Three Network Convergence (TNC) policy in China Senior management close to client decision-makers Improved internal communication & lower costs Our proprietary core IP technology can be applied across
Slide 13: China's Three Network Convergence: a growth catalyst for UTStarcom
13 Focused on cable / telco two-way entrance Pilots concluded and expansion drives ahead Policy Launched Pilots Conducted National Implementation 2010 2010—2012 2013—2015 China’s Three Network Convergence: a growth catalyst for UTStarcom Three Network Convergence (TNC) is the Chinese government poli
Slide 14: UTStarcom Wins in TNC
14 1 D 6 5 8 2 3 4 7 10 12 9 11 Sichuan broadcast control platform In July 2010, 12 Chinese cities and regions were given pilot status in the national TNC push, including: Beijing, Shanghai, Hangzhou, Nanjing, Dalian, Harbin, Xiamen, Qingdao, Wuhan, Shenzhen, Mianyang and Changsha UTStarcom has alre
Slide 15: Strategy 1: Opportunities in China
15 Strategy 1: Opportunities in China Focus Area UTStarcom’s Achievements Interactive Television (including IPTV, iDTV & Internet TV) Currently leading IPTV market share in China Won two contracts with provincial-level cable operators in Guangdong (SMIC) and Anhui for iDTV Won 10 contracts with city
Slide 16: Strategy 1: Opportunities in Other Asian Markets
16 Strategy 1: Opportunities in Other Asian Markets Market & Focus Area UTStarcom’s Achievements South Asia: Focused on IPTV and Broadband IPTV: Cooperate with MTNL, BSNL, Bharti, SLT and other leading South Asia operators. We have the largest market share Broadband: Currently have more than 30% mar
Slide 17: Strategy 2: Parallel Growth Opportunities
17 Strategy 2: Parallel Growth Opportunities none 3million (iDTV) <5million >1 billion 6million (IPTV) >100million 177 million 78 million none Interactive video services Broadband service TV and Digital TV service Voice services <25% 100% Bi-directional network percentage Service Cable Telco TNC wil
Slide 18: Strategy 3: Our Operational Support Services
18 Strategy 3: Our Operational Support Services Equipment Sales Related Service Business IP Signage Platforms IPTV, Internet TV Platforms iDTV Platforms Telecom Operators TV and Cable Operators Enterprise Operators UTStarcom has deep experience in building and supporting the operations of iDTV, IPTV
Slide 19: Strategy 3: Operational Support Services Value Chain
19 Strategy 3: Operational Support Services Value Chain Content Producers /Providers Ad Management Solutions VAS Solutions IPTV/ Internet TV Subscriber Base Content Distribution RollingStream Video Platform PC Video Subscriber Base Mobile TV Subscriber Base Our end-to-end solutions give access to lo
Slide 20: Strategy 3: Vision to Grow OSS Business
20 Strategy 3: Vision to Grow OSS Business Time Revenue Service based business Equipment based business Note: This chart not drawn to scale. For indicative purposes only.
Slide 21: Financial Overview and Outlook
21 Financial Overview and Outlook
Slide 22: Q3 2010 Financial Highlights
22 Q3 2010- Financial Highlights Revenue of US$61.4 million for the third quarter 2010, which decreased 12.9% from the third quarter 2009 Gross profit of $12.1 million, or 19.7% of total revenue, which includes the following items: $8.5 million in additional inventory reserve $1.9 million value adde
Slide 23: Moving Towards Breakeven
23 Moving Towards Breakeven Consolidated HQ functions in China and beginning process for foreign private issuer status Improved corporate structure to allow streamlined management Rationalize facility locations and non-core businesses have been disposed Employee headcount is being reduced to less th
Slide 24: Investment Recap
24 Investment Recap Breakeven in 2011 Focused on China and rest of Asia Strong existing relationships with major operators Benefiting from China’s Three Network Convergence Operational support services business high-margin, recurring revenues Diversifying customer base Strong cash position and no de
Slide 25: Additional Information and Where To Find It
25 Additional Information and Where To Find It This communication is being made in respect of a proposed reorganization transaction. WHEN THE PROXY STATEMENT/PROSPECTUS ARE FILED WITH THE SEC AND BECOME AVAILABLE, INVESTORS OF UTSTARCOM ARE URGED TO READ THESE DOCUMENTS AND ANY OTHER RELEVANT DOCUME
Slide 26: Investor Relations Contact
26 Investor Relations Contact UTStarcom, Investor Relations: Ms. Jing Ou-Yang T: + 8610 8520 5153 E: jouyang@utstar.com Kreab Gavin Anderson, external advisor: From Asia: From the US: Brion Tingler Judi Flynn Echeverria T: + 8610 6535 3567 T: + 1 212 515 1855 E: btingler@kreabgavinanderson.com E: jf