I. Current Situation of R&D
Main products of the company: products serving satellite communications, shortwave communications, mobile communications, mechatronics instrument equipment and information technology, and household electrical appliances and other consumer electronics; undertaking the development and production of important new high-tech products.
Powerful technological strength of the company: the mechanism of close joint development and international cooperative development in industry, university and research has been set up with domestic colleges & universities and research institutions as well as large foreign companies. It has also established 4 national engineering research centers, 3 provincial engineering research centers, 4 municipal engineering research centers, and the first national postdoctoral workstations.
With constantly improving scientific research and production, the company has committed to the infrastructure and technical renovation for scientific research in recent years. Furthermore, it has won several awards, with more than 30 products having acquired the “National Award for Scientific & Technological Advancement”.

II. Major Technological Development Trend
In light of the technological development plan set out by Panda for the “Eleventh Five-year Plan”, the company is requested to grasp opportunities to optimize the industry and product mix, promote the development of technological fields in digitization, networking and smart products, and focus on new hi-tech electronics, digital audio & video systems, rail transit clearing & settlement systems, dedicated equipment, mobile and distance communications, system engineering and integrated electronic manufacture equipment for industrial expansion.
At present, the company has established a future development plan dominated by such industries as communications, digital audio & video, software, intelligent electronic equipment and information products, advanced electronic manufacture, rural communication, as well as environmental protection and energy conservation techniques.

III. Technological Projects
1. Integrated circuit technology, products and terminal equipment for high-definition flat-panel TV image processing
• Conduct research on integrated circuit technology for image processing of high-definition flat-panel TV with higher integration and performance
• Develop digital image processing chips with independent intellectual property rights, which break through the market situation of high-end TV video processing technology led by foreign manufacturers, and
• Digital image processing technology which can be applied in other video equipment industries , such as medical care and intelligent identification, etc.
2. Dedicated security key system design for the Automated Fare Collection System (AFC) of rail transit
There is a huge number of transactions in recharging and consumption of E-ticket cards for rail transit, and the security of recharging equipment and E-ticket card transaction is very important. Products must meet the security requirements based on the security technology of PKI combined with the characteristics of Automated Fare Collection System (AFC) of rail transit. At present, there is no such precedent to follow in China. This project is undertaken by Urban Transportation Technology Development Center of Panda Information Industry Group. 3. Products and equipment of new generation network platform and fare collection terminal technology with intelligent transport information control
Realize the domestic production of AFC system and equipment to generate equipment and application modules with independent intellectual property rights. This project is undertaken by Urban Transportation Technology Development Center of Panda Information Industry Group.
4. Research and application of the trans-platform scheme of digital set-top boxes (middleware)
There are numerous schemes for digital set-top boxes. Each scheme has its own bottom layer drive; relevant application layers are based on their own bottom layer development. Therefore, changing the bottom layer necessitates redeveloping corresponding application layers. Based on the research of an intermediate layer, the trans-platform scheme realizes the docking between various bottom layers and application layers. This project is undertaken by Digital Set-Top Box Technology Engineering Co Ltd of Panda Information Industry Group.
5. Development and application of satellite flat-panel antennas (fixed and mobile two-way reception)
Along with the successful launching of live satellites in China and communications barriers of the Wenchuan Earthquake, satellite communications will enter into an all-round development stage. As sophisticated technology, this project is related to electronic wave research, math, structure, materials, surface treatment, electromotor, automation, mechanics, satellite, computer and other scientific fields. This project is undertaken by Digital Set-Top Box Technology Engineering Co Ltd of Panda Information Industry Group.
6. Cash withdrawal and deposit, payment, recharging and ticketing self-service financial system
Make a study of citizen-oriented financial bankcards and convenience facilities of the department of urban public operations in accordance with the demand of current social life and market economic development, thereby realizing urban information technology in a true sense. This project is undertaken by Nanjing Panda Mechatronics Instrument Technology Co Ltd of Panda Information Industry Group.
7. Logically driven digital technology of rail transport doors
Conduct research on logically driven door control technology so as to be able to achieve complete domestic production and produce doors with independent intellectual property rights for the purpose of laying down a solid foundation for the development of rail information technology industry. This project is undertaken by Nanjing Panda Mechatronics Instrument Technology Co Ltd. of Panda Information Industry Group.
8. Environment protection technology: total phosphorus analyzer
Total phosphorus analyzer technology is used to analyze the content of phosphor in sewage. Optical measuring technology utilizes colorimetric measurement; with accurate sampling guaranteed.
9. Environment protection technology: fully- automatic total nitrogen analyzer
The fully-automatic total nitrogen analyzer is used to analyze the content of nitrogen in sewage. Optical measuring technology utilizes colorimetric measurement. With 220nm wavelength, the filter has extremely low transmittance; and sampling accuracy is guaranteed.
10. Other energy-saving technologies: research and application of low power consumption in standby mode
Various standards impose requirements for energy saving and environmental protection in electronic products. This technology requires adopting reasonable hardware and software measures to realize low power consumption standby with rapid response to booting with reasonably controlled costs. This project is undertaken by Digital Set-Top Box Technology Engineering Co Ltd of Panda Information Industry Group

In the context of increasingly fierce TV market competition, the company strives to enhance its capability for independent innovation by integrating R&D capacity and adjusting R&D direction. Focusing on the R&D of digital TVs, LCD flat-panel TVs and digital rear projection TVs, it has developed 27 - 40’’ LCD TVs and HD CRT TVs supporting VGA and other computer display formats. In the development of analog TVs, it has also created serial products dominated by Toshiba and Phillips cores, meeting the global market demand. It has completed the development of TVs with the Toshiba core and a built-in DVD, and achieving independent development of TV application software.
In the process of the reinforcement of product development and update, mobile communications has evolved into multimedia products, with a series of terminals and systems boasting technological advantages and market competitiveness, including mobile phones, dedicated communications, data communications and vehicular communications.
With science guiding information technology, the company has reversed several years of operational downturn with new technology, new products, and technological innovation. It has increased product categories and expanded industrial scale gradually and developed system integration, intelligent electronics and software. It has successfully completed the AFC project of Nanjing Metro and has undertaken software development and system integration for Nanjing Library, National Fitness Center, and other large-scale projects. The fiscal cash register has passed the national technological appraisal and qualification inspection, and acquired the required production permit. Five new DVB-S products have also won success; electronic photo frames, MP3 and MP4 are gradually being unveiled, revealing a promising development trend. System integration has been expanded to smart systems and the size of projects grows. The company competitiveness has been reinforced.
In mechatronics instrument technology, based on the business idea of “Achieving three elevations by means of three devotions”, the company endeavors to
• elevate technological content,
• gradually expand production scale,
• speed up product updates, and
• gradually increase the number of new categories.
The company has clearly defined two major projects of modules and power supply of flat-panel TVs, 8 key projects such as metro PSD (Platform Screen Door) equipment, 4 key research projects such as nitrogen protective reflow ovens, and 4 pre-research projects such as WIMAX access and terminal equipment.

IV. Typical Outstanding Technological Achievements
1. 3G TD-SCDMA mobile terminals have completed the testing
The company has completed two models of TD-SCDMA terminals conforming to 3G mobile communications technology, and won the bid for first trial access operators of China Mobile.
As the only company with the 3G mobile communications technology in Nanjing, the company will make every effort to gain more government assistance, and also establish strategic cooperative relationship with technical standard holders and operators by mastering relevant standard protocols and building development platforms.
2. New generation rural direct broadcast satellite receivers have entered marketing stage
Along with the development of digital TVs, commercial TV broadcasts like conditional access, pay TVs and VOD have emerged in China. As a part and parcel of digital TV project, Conditional Access systems (CA) have completed the certification and authorization of systems users as well as program scrambling.
New generation rural direct broadcast satellite receivers developed by the company are being stationed in Jiangsu province, Liaoning province, Jilin province, Shanxi province, Anhui province and Heilongjiang province.
3. Orders for urban rail transport AFC (Automated Fare Collection) system have exceeded RMB 300 million
In April last year, the “Development and industrialization of AFC” was listed in the “Proposed project of the National Torch Program”, marking its leading role in the AFC field.
The automatic recharging machine and AFC system have completed their development and passed the provincial-level appraisal. AFC and ACC systems developed by the company have been applied in Nanjing and Beijing Metros, thus making it one of the main suppliers of urban rail transport clearing & settlement and collection systems in China. The company boasts independent R&D groups and a great deal of engineering experience, with increasing market share. At the present time, it is actively bidding for AFC in Shenzhen, Guangzhou, Shanghai, Beijing, Shenyang, Wuhan, Chongqing and Chengdu, having industrialized many products in the rail transport field.
This project has won contracts totalling over RMB 300 million
4. COD environment protection water quality on-line automatic monitoring system has been ordered
At present, water quality on-line automatic monitoring instruments are mainly imported. Mainly centralized in Guangzhou, Beijing and other cities, other China-made instruments adopt programming without high reliability. The development of this instrument has far-reaching significance in comprehensive environmental control and environmental protection industry in local areas.
Having passed the national certification for environment protection products, the COD water quality on-line automatic monitoring system developed by the company is expected to gain a larger order for controlling cyanobacteria in Taihu Lake in Jiangsu province. This promises to be a new economic growth point in the company.

V. The Progress of Key Technological Projects for the “Eleventh Five-year Plan” Period
1. New generation digital TV receiver
The company is developing the personal digital video recorder (PVR), a home network gateway integrating network functions, and digital PVR technology stored high-end PVR set-top box combined with a digital TV set-top box; the all-in-one TV set-top box with TV receiving device embedded in DVB-C; the terminal receiver conforming to the national and industrial direct broadcast satellite technological standard and access conditions. This receiver can meet market demands in terms of performance-price ratio and functionality, with some patented technologies.
2. Urban rail transport AFC (Automated Fare Collection) system
TVM (Ticket Vending Machine) mainly serves the vigorous development demands of smart cards and rail transport in domestic cities. Based upon independent R&D, the company is developing smart card recharging machines with independent intellectual property rights.
• Input power supply: 220V+10%/-15%，50Hz±4％;
• power consumption: 150W in standby; 400W in operation;
• banknote cashbox volume: >=1000 pieces;
• rate of communications with station computer systems: 100Mbps;
• service life: over 10 years.
TVM (Ticket Vending Machine) is an important part of the Metro AFC system. As an independent product of Panda Electronics, this TVM can have its interior modules replaced according to AFC project design requirements of different cities. The cost of each TVM is kept at a low level. In performance-price ratio, the Panda TVM has strong competitive force, and the product will be recognized by THALES (France).
Main technical indexes:
• service life: ≥15 years;
• design objective: selling 2, 300 pieces of TOKEN per day;
• average handling capacity: 4 transactions per minute.
The design level meets urban rail transport AFC equipment technical requirements. The AFC and application software will fill the domestic gap, better enhancing the running efficiency of the rail transport AFC system. Taking the lead in the clearing and settlement field of urban rail transport in China, the AFC system completely realizes the standard design of automatic fare collection system based on smart cards, uniform key system design and ticket management design, with interfaces reserved for the building of additional lines of urban rail transport in the future.
As an important component of metro engineering, AFC involves network communications, electromechanical integration, information processing, modern management and other high technologies. Based on years of hard work, the company has mastered the key technology of rail transport AFC system and participated in the compilation of Technical Conditions of Urban Rail Transport AFC System, a standard of the Ministry of Construction. With many patents and software products, it takes the lead in China.
3. TD-SCDMA terminals and network cards
The company has integrated the research achievements of 3G and mobile ad-hoc networks in China, using heterogeneous network fusion, multi-hop routing optimization, automatic sensing and other advanced technologies, and combining wide-range high-speed mobile communications with narrow-range low-power broadband wireless access technology. The company is developing TD-SCDMA multi-module mobile terminals to be industrialized based on multi-network fusion platform technology with independent intellectual property rights. The product meets the demand of the network carrier in an innovative manner. Fusing fixed network with mobile network, and regional network with backbone network, it boasts multi-network access and multi-hop transit capabilities with low transmission power, safety, electricity economy, and strong adaptability.
The company has completed several models of TD-SCDMA terminals according to the 3G mobile communications technology, and successfully won the bid to be one of the first trial network operators of China Mobile.
As the only company with the 3G mobile communications technology in Nanjing, the company will make every effort to gain more government assistance, and also establish strategic cooperative relationship with technical standard holders and operators by mastering relevant standard protocols and building development platforms.
4. R&D and industrialization of dedicated mobile communications terminals
（1）Vehicular communications and security system is featured by vehicular telephone, GPS positioning and protection of vehicles against theft and damage.
It is in accordance with
• Phase II+;
• ricoder HR/FR/EFR SMS;
• ITU SS7;
• GPS industrial and national standards;
• major technical indexes: reception sensitivity ≤-100 dBm;
• sending power: Class 4.
This project has completed a first-batch production of 25,000 sets, realizing a production considerable value.
（2）Commercial encrypted cell phones encrypt the information transmitted from mobile communications terminal equipment, and comprise mobile security terminal equipment, network management center and key manager as typical information security products.
Prototypes have been completed and are being tested by government bodies.
（3）Cell phone TVs with MP3/MP4/touch screen can receive TV signals for tele-viewing and realize QVGA display at low cost. The company mainly researches and develops TV receiving, electricity economy, encryption & certification, and streaming media decoding techniques, as well as nonsymmetrical two-way transmission technique combining mobile network and broadcast TV network, and mobile VOD technique.
This project has completed its development, and will be released into the market as soon as the standard is confirmed by China Mobile.

VI. Outline of recent technological input and output
78 new projects have been developed during 2008 giving rise to a large number of new products.
We’ll continue to make more efforts to ensure the utilization efficiency of research funds and feasibility study review of new products so as to gradually enhance the output efficiency of research. While contributing to scientific research development, the company will apply for special projects with the Ministry of Information Industry, the National Development and Reform Commission, the Ministry of Science and Technology, and Jiangsu Provincial Department of Science and Technology, and seek government funding. At present, 14 governmental special projects of different kinds have been applied for, 3 of which have been approved and the rest are under examination.

VII. Intellectual property rights and standardized management
After rapid growth of many years, in the first half of 2008 the group company applied for 71 patents, a growth of 52% compared with the same period the previous year. 68 patents were authorized, a growth of 100% compared with the same period the previous year. The company was listed as one of 12 enterprises advantageous in intellectual property rights in Jiangsu province.
The company actively participates in the formulation of latest national and industrial standards so as to increase the influence of “Panda”. In addition, striving to keep leading the industry, the company makes every effort to set up subcommittees for national standards led by “Panda”. It has applied for three subcommittees, the “Subcommittee for Shortwave Communications Standardization”, “Subcommittee for Mobile Communications Standardization” and “Subcommittee for Urban Rail Transport AFCS”. The company has also applied with Jiangsu Provincial Department of Science and Technology for key technical standard projects of three technically supported plans, including “Information Service System for Identifying Personal Location by Satellite”, “Pollution Control Standards for Electronic Information Products” and “General Standards for Digital LCD TVs and Digital PDP TVs”, which are currently under review.
“The Working Group for Product Design Documents of The National Technical Committee for Standardization of Technical Product Documents” has moved in to “Panda”, making the company the only unit with such a special honors among electronic information enterprises in Jiangsu province.
In adopting international standards and foreign advanced standards in recent years, the company has handled a record 184 product standards, with 164 items of standards adoption at a ratio of 89%. This meets the 2010 National Standardization Administration Committee of China requirements well in advance. In addition, the company has participated in the compilation of “Information Safety Standards” and “General Terminal Standards” of the national standard Information Service System for Identifying Personal Location by Satellite, and submitted their texts for approval or revision. At present, it is leading the formulation of two national standards: General Standards for Shortwave Single Sideband Communications Equipment and Transport Packing of Mobile Communications Equipment. Additionally, the company has joined the compilation of teaching materials for the standardization of the electronic information industry, and formulated Compilation Methods of Product Design Documents.