STMicroelectronics
Philippe Lambinet
Executive Vice President
Home Entertainment & Displays (HED)
Consumer Electronics Show
g - Januaryy 5,, 2011
Las Vegas
EXPERIENCE
ENTERTAINMENT !
2
Executive Summary
2010: Gaining Share as Market Grows
Market Trends Driving HED Growth
Strategy and Assets
Priorities for 2011
3
HED Product Portfolio
S t T Box
Set-Top B
TV
Monitor Audio
4
Gaining Share as Market Grows
ST 9M10 Sales: $7.5B HED 9M10 Sales: +38%YoY
40%
e Growth (9M09-9M10)
35%
30%
25%
20%
15%
Revenue
10%
5%
0%
HED
HED** Other Groups HED SAM*
SAM HED
** Excludes Imaging * Serviceable Available Market; ST, IMS Research, Gartner, iSuppli
5
Leading the Set-Top Box Market
Set-Top Box Shipments
2010
Competitor Leader
US
RoW
ST Leader
Source: IMS Research
6
HED 2010 Highlights
Strong revenue growth driven by continuing adoption of HED products
Gaining market share
Gen. 2 based STB massively deploying
> 50 customers in production now
> 50% of ST total STB shipments in 2010
Gen. 3 volume ramp-up
Freeman/FLI7510 solution for DTV designed in at multiple partners
> 50 partners enabled with STi7108 platform
Complete ecosystem developed for interactivity, gaming, rich multimedia…
7
HED 2010 Highlights
Strong revenue growth driven by continuing adoption of HED products
Gaining market share in all target markets
Gen. 2
based STB massively
Expanding in thedeploying
DTV Market
> 50 customers in production now
> 50% of ST total STB shipments from 2010
Strong World Wide Position in the STB Market
Gen. 3 volume ramp-up
Freeman/FLI7510 solution for DTV designed in at multiple partners
>50 partners enabled with STi7108 platform
Complete ecosystem developed for interactivity, gaming, rich multimedia…
8
Market Trends Driving HED Growth
CE 3.0
Digital Living Room
NEW USER EXPERIENCE
Rich Multimedia
ENVIRONMENTAL RESPECT
Green
9
Digital Living
Room
Leading MPEG2 to H.264 Transition
Market ST Shipments 2010
200
180 >50% H.264 Set-
MPEG2 op Box
Top o
160 Shipments
140
ments (Mu)
120
100
80 H.264 MPEG2
Shipm
60
40
20 H.264
0
2008 2009 2010 2011 2012 2013 2014
Source: IMS Research
10
Digital Living
Room
Set-Top Box Market Trends
Gateway
3D
Added Value
HYBRID
HD PVR
HD
SD PVR
SD
1995 2000 2005 2010 2015
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Digital Living
Room
DTV Market Trends
Connectivity Wired / Wireless
2D/3D 2D 3D
Large Size 40”- 49” 50”- 52” 55”- 60” 60”-72”
Contrast Ratio 2000 1
2000:1 3000 1
3000:1 4000 1
4000:1 >5000 1
>5000:1
1080p 1080p (Full HD) 4K x 2K
120/100 Hz 120/100Hz 240Hz
Ultra Slim Ultra Slim LED B/L
Eco/Green Lower Power Consumption
Environmental Friendly
Low Cost Monitor Panels Lower Spec Panels (Brightness, etc)
for Emerging Countries
~2006
2006 2007 2008 2009~10
2009 10 ~2015
2015
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Digital Living
Room
Connected TV & STB Market
300
~30% of TVs shipped in 2011
250 will be internet enabled
Mu)
200
Shipments (M
TV STB
150
100
50
0
2009 2010 2011 2012 2013 2014
Source: iSuppli
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Rich
Multimedia
3D Everywhere
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Rich
Multimedia
3D Allows New Premium Services
Enhanced offer to
Pay per View Premium 3D Games Store
HDTV’s subscribers
Channels
(VOD)
15
Rich
Multimedia
3D Services Announced
Cyfrowy+
Sky.de
Telekom
Virgin MediaUPC Akado
Comcast Sky NTV plus
IKO
IKO TV J:Com
Cablevision Numericable
N i bl BS11
DirecTV Canal+ RAI Skyperfect Jsat
Dish Orange Hikari
Canal+ Du
AT&T U-verse
Telefonica
Verizon FiOS
CJ Entertainment
Skylife
Foxtel
SK Telecom
Source: ST based on public information as of December 2010
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Green
Reducing Power in Consumer Products
Government Regulations Compliancy
Consumer Selection Criteria
Optimized Product Cost
Bill of material
Product reliability
17
ST Strategy and Assets
CE 3.0
Digital Living Room
NEW USER EXPERIENCE
Rich Multimedia
ENVIRONMENTAL RESPECT
Green
18
Digital Living
Room
SoundTerminal®
200 180
ST cumulative shipments (Mu)
3rd Generation 150
SoundTerminal Enables
100
Tablet PC with Solid
State Sensors 50
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Microphone Speakers
Earphone
Sound Shaping
p g&
Speakers compensation
Digital Living
Room
MoCA
ST “Contributor member” of
MoCA
STi7108M available
Supports MoCA 1.x (MoCA Alliance©)
& MidRF (DIRECTV ©) standards Headless Gateway
Digital MAC & PHY processing
MoCA 2.0 option for next
generation
Introduction
I t d ti 2011
Mass production 2012
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Digital Living
Room
DisplayPort
Managed by VESA DisplayPort adopters
• Independent committee
Free & open standard
• Topology agnostic
• Content agnostic
• HDCP
200
Monitor shipments (Mu) 180
ST has an active role 160
140
120
0
100
• Lead architect/spec author is an ST 80
HED employee 60
40
20
0
2008 2009 2010 2011 2012 2013
Source: DisplaySearch Monitor DisplayPort Non DisplayPort
HED Platform Evolution
Gen. 2 Gen. 3 Gen. 4
Best New services
performance New UI Open Internet
/ cost ratio
STi7105 STi7108 STi71xx
Freeman
Freeman Ultra Newman
Diamond
1000 DMIPS CPU Dual CPU & L2 cache Multi-core SMP CPU
Introduction of: >2000 DMIPS >8500DMIPS
AVS HD Introduction of: Introduction of:
DDR2 1080p60 decode Dual 1080p60 decode
e-SATA Dual 32b DDR2/3 SVC decode
3D GL
GL-ES2.0
ES2 0 & SVG GPU HD encode
MoCA 1.x DisplayPort, MoCA 2
Mass Production Volume Ramp-up Introduction
MP: 2009 MP: 2011 MP: 2012
Rich
Multimedia
Solution by Market
Open Platforms
Complexitty
ssing & C
Walled Garden
Increased Proces
Broadcaster
Centric
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Rich
Multimedia
Broadband & Broadcast Ecosystem
Services Platforms Technology Enablers
BROADCAST MARKET PLACE
BROADCASTER
BROADBAND
MIDDLEWARE SOFTWARE
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Rich
Multimedia
Leading the 3D Market
3D Gfx
Stereoscopic 3D
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Rich
Multimedia
Supporting New Interactions
Accelerometer
Motion
Shake
Navigation
g
Camera
Parental Control
Video Conferencing
Contextual Information
Control
Interaction (QBR)
Microphone
Video Conferencing
Control
Music
Finger Scan
User recognition
Payment
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Green
A Pioneer and Visionary Leader
Corporate Environment Policy since 1993
In 1995, ST was one of the first companies to set measurable and
time-defined goals for environmental performance and to publicly
commit to them
Investing in the environment makes economic sense
ISO 14000: the business manager
manager's
s complete guide to environmental management
By Perry Lawrence Johnson
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Green
Energy Efficiency in our Products
KWh/y Watts
250
4
200 Competition
G1 3
150 Energy Star
100 G2 G3 G4
2
G1 E.U.
50 1 G2 Regulations
G3 G4
0 T 0 T
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012
PVR system Basic STB system
Yearly Power consumption Stand b Po
Stand-by Power
er e
evolution
ol tion
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Next Step: The Best of Two Leaders…
Competitive STB & DTV SoC roadmap
Leading Security System Integration
Process leader
Competitive Performance roadmap
Fast growing Software Ecosystem
Processors Undisputed Power Efficiency leader
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…Yields Breakthrough Products
DDR
A9 CPU
DDR
TRANSPORT
MALI MCTI
DEINT
VIDEO VDP
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Setting a New Benchmark
On a TV/STB multi-core integrated for Open Platforms
and Connectivity Applications
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HED Priorities for 2011
• Gain share in US
Continue to
Lead in STB • Increase leadership in all other
markets
32
ST Leading in STB in Emerging Markets
Eastern Europe
& China 51Mu
India
16Mu
Latam
11Mu
ST Cumulative Shipments 2008-2010
33
HED Priorities for 2011
• Gain share in US
Continue to
Lead in STB • Increase leadership in all other
markets
Continue to • Ramp Up Freeman/Freeman Ultra
E
Expand d iin • Prepare for Newman
DTV
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Conclusion
• US Market for Set-Top Box
Growth Opportunities • DTV Market
• SoundTerminal for Tablet PC
• Digital Living Room
Market Trends • Rich Multimedia
• Green
G
• Set-Top
Set Top Box Market Leader
ST Assets • Performance Leader
• Environmental Commitment
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Q&A
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Forward Looking Statements
Some of the statements contained in this release that are not historical facts are statements of future expectations and other forward‐looking statements (within
the meaning of Section 27A of the Securities Act of 1933 or Section 21E of the Securities Exchange Act of 1934, each as amended) that are based on management’s
current views and assumptions, and are conditioned upon and also involve known and unknown risks and uncertainties that could cause actual results,
performance or events to differ materially from those in such statements due to, among other factors:
Changes in demand in the key application markets and from key customers served by our products, which make it extremely difficult to accurately
forecast and plan our future business activities. In particular, following a period of significant order cancellations in 2009, we have in 2010 experienced a
forecast and plan our future business activities In particular following a period of significant order cancellations in 2009 we have in 2010 experienced a
strong surge in customer demand, which has led to capacity constraints in certain applications and may in the future, in case of excessive inventory at
customers or distribution channels, experience order cancellations;
our ability to utilize and operate our manufacturing facilities at sufficient levels to cover fixed operating costs during periods of reduced customer
demand, as well as our ability to ramp up production efficiently and rapidly to respond to increased customer demand, in an intensely cyclical and
competitive industry, and the financial impact of obsolete or excess inventories if actual demand differs from our expectations;
the operations of the ST‐Ericsson Wireless joint venture, which represents a significant investment and risk for our business and which may lead to
significant additional impairment and restructuring charges, in the event ST‐Ericsson is unable to successfully compete in a rapidly changing and
i
increasingly competitive market;
i l ii k
our ability to compete in the semiconductor industry since a high percentage of our costs are fixed and are incurred in Euros and other currencies than
U.S. dollars, especially in light of the increasing volatility in the foreign exchange markets and, more particularly, in the U.S. dollar exchange rate as
compared to the Euro and the other major currencies we use for our operations;
the outcome of ongoing litigation as well as any new litigation to which we may become a defendant;
changes in our overall tax position as a result of changes in tax laws or the outcome of tax audits, and our ability to accurately estimate tax credits,
benefits, deductions and provisions and to realize deferred tax assets;
the impact of intellectual property (“IP”) claims by our competitors or other third parties, and our ability to obtain required licenses on reasonable terms
h i f i ll l (“IP”) l i b i h hi d i d bili b i i d li bl
and conditions;
product warranty or liability claims based on epidemic failures or recalls by our customers for a product containing one of our parts;
our ability in an intensively competitive environment to secure customer acceptance and to achieve our pricing expectations for high‐volume supplies of
new products in whose development we have been, or are currently, investing;
changes in the political, social or economic environment, including as a result of military conflict, social unrest and/or terrorist activities, economic
turmoil, as well as natural events such as severe weather, health risks, epidemics, earthquakes, volcano eruptions or other acts of nature in, or affecting,
the countries in which we our key customers or our suppliers operate
the countries in which we, our key customers or our suppliers, operate.
Such forward‐looking statements are subject to various risks and uncertainties, which may cause actual results and performance of our business to differ
materially and adversely from the forward‐looking statements. Certain forward‐looking statements can be identified by the use of forward‐looking terminology,
such as “believes,” “expects,” “may,” “are expected to,” ”, “should,” “would be,” “seeks” or “anticipates” or similar expressions or the negative thereof or other
variations thereof or comparable terminology, or by discussions of strategy, plans or intentions.
Some of these risk factors are set forth and are discussed in more detail in “Item 3. Key Information — Risk Factors” included in our Annual Report on Form 20‐F for
the year ended December 31, 2009, as filed with the SEC on March 10, 2010. Should one or more of these risks or uncertainties materialize, or should underlying
the year ended December 31, 2009, as filed with the SEC on March 10, 2010. Should one or more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those described in this release as anticipated, believed or expected. We do not intend, and do
not assume any obligation, to update any industry information or forward‐looking statements set forth in this release to reflect subsequent events or
circumstances.
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