Motorola to Enhance Digital Cable Set-Top Box Portfolio through Strategic Acquisition in China

Motorola, Inc. (NYSE: MOT) today announced that it has acquired the assets related to digital cable set-top products of Zhejiang Dahua Digital Technology Co., LTD and Hangzhou Image Silicon (collectively, Dahua Digital). Terms of the transaction were not disclosed.

Dahua Digital is a privately held, developer, manufacturer, and marketer of cable set-tops and related low cost integrated circuits for the emerging Chinese cable business. Dahua Digital's leading set-top portfolio includes basic set-tops, two-way interactive set-tops and the high-end media-center class of products. Dahua Digital also has a substantial China cable operator customer base. Its strong, established support infrastructure for digital cable customers includes focused development resources, a direct sales force for the existing regional customers, an established field engineering team and an integration team to ensure that customer requirements are met rapidly.

The transaction will expand Motorola's digital set-top box offerings in China and significantly improve Motorola's time to market in the region. Further, Dahua Digital's low-cost chipset solution, designed specifically for the Chinese set top business, will enhance Motorola's product line. With Dahua Digital's extensive R&D network, strong, locally focused set-top solutions, and industry expertise, Motorola will enhance its ability to meet customer demands in the dynamic and rapidly evolving China set top business.

"We are very pleased to announce this transaction with Dahua Digital, which will significantly expand our existing capability in China and position Motorola well to address the tremendous growth opportunities this market presents," said Dan Moloney, president of Motorola's Home & Networks Mobility business. "Dahua Digital's strong time to market advantage, R&D capabilities and sales reach are a compelling fit with Motorola's strategy in China. We look forward to teaming with Dahua Digital's experienced employees, whose expertise in the China digital cable market will be an invaluable asset to us in this important emerging business."

"Chinese digital cable is rapidly growing, presenting an important opportunity for Motorola to extend its existing business in set-tops," said Simon Leung, president of Motorola Asia Pacific. "130 million Chinese households currently subscribe to cable, and as customers make the transition from traditional analog solutions to digital cable, digital cable subscriptions in China are expected to grow from 10 million in 2006 to over 165 million by 2016. With this transaction, Motorola will be well-positioned to capitalize on increasing demand for digital cable solutions in China."

"This is tremendous opportunity for Dahua Digital," said Zhu Jiangming, chairman and general manager, Dahua Digital. "By joining forces with Motorola, an established global industry leader, we will enjoy technological benefits and have the resources to enhance our distribution capabilities throughout China. As part of Motorola, we will be well-positioned to deliver even more compelling digital set-top box solutions and outstanding service to our customers."

Dahua Digital will be integrated into Motorola's Home & Networks Mobility business. Motorola intends to maintain Dahua Digital in Hangzhou, which will be an integral component of Motorola's China digital cable market operations.

Motorola is a leading supplier of set tops, having shipped over 50 million worldwide. The company also leads in IPTV set tops with shipments in excess of two million to date.

Zhejiang Dahua Digital Technology Co., Ltd. is a reputable, hi-tech company focusing on R&D, manufacturing, marketing and services of digital TV set-top boxes (STB). With leading market share among other industry players in China, Dahua Digital is committed to providing high quality and cost-effective products through innovative technology, aiming to promote the development of digital TV in the market. Dahua Digital has a strong team of engineers and experts with rich experience in STB research. Dahua Digital provides comprehensive, wide-ranging end-to-end products and solutions, helping operators to deliver innovative services.

Motorola is known around the world for innovation in communications. The company develops technologies, products and services that make mobile experiences possible. Our portfolio includes communications infrastructure, enterprise mobility solutions, digital set-tops, cable modems, mobile devices and Bluetooth accessories. Motorola is committed to delivering next generation communication solutions to people, businesses and governments. A Fortune 100 company with global presence and impact, Motorola had sales of US $36.6 billion in 2007.

Source: Motorola