The year of 2007 is crucial for China’s TMT industry after several years’ stable development. Because of great breakthroughs in some key factors and changes in the market, many difficult problems accumulated several years are all expected to be solved in 2007. Moreover, the industrial rhythm will be far different from that in 2006.

3G is still the core driving force in telecom sector. There is no doubt 3G services will become a highlight in 2007 along with the maturation of TD-SCDMA. When the time comes, the whole telecom market will become unusually active influenced by 3G network construction, consumer purchasing for 3G terminals and 3G mobile value-added services. It is conservatively estimated that the annual newly-increased investment in 3G for operators is about RMB 70 billion during the period of 3-year startup of 3G.

It becomes an inevitable trend for analog TV turning to DTV in an all-around way. In 2006, China DTV business showed a fast-growing trend. And we believe this trend will be further strengthened in 2007.

Digitalization, mobility and amalgamation are the highlighted characteristics of digital new media business. Presently, the annual growth rate of global digital media industry reaches 33%, including business of DTV, mobile video, DBS, mobile TV and IPTV. As the policy barriers between telecom and radio & TV sectors will be gradually unlocked in 2007, digital new media business like IPTV and mobile TV will get better development in the coming year.

Both operating system and CPU are the foundation stones for the development of IT industry. Along with the formal introduction of Windows Vista, it will bring great opportunities for developing semiconductor, computer and software industries.