• Rakuten corporate summary– Rakuten in early stage (pre-IPO) – Rakuten in growth stage – Rakuten in global expansion stage

• Rakuten Ichiba summary– Rakuten Ichiba business model – Rakuten Ichiba success secret – Rakuten Ichiba Taiwan summary – Rakuten Ichiba future

• Comparison with Easy Pha-max – Business model – Operation – Things to learn from Rakuten Ichiba

• Conclusion

Mr. Hiroshi Mikitani,Chairman & CEO Rakuten Inc.

A former banker at age of 35, founded Rakutenin 1997 during Internet boom and brought thecompany to IPO in 2000.

• 40million members – 3rd Jul 08 • Ranked No. 5 in Japan top website – Alexa • No. 1 retail brand in Japan & 14th Consumer

Brand • Exceed 24,000 merchants – Q2 08 • Net sales of US$1.76bil & US$304mil net income

– 2007 financial report • Hired aprox. 3400 employees • IPO in Jasdaq – 2000

• 1993 – 1995: Mikitani earned his MBA in Harvard, and join Bank of Japan when he returned

• 1995: Mikitani left his job with Bank of Japan to start an online business with his own money

• 1997 2/7 : founded MDM, Inc. with 5 employees • 1997 5/1 : Rakuten Inchiba (cybermall) launched,

with 13 merchants & first month revenue of US$3200

• Initial business model: charging ‘virtual real-estate fee’ of US$475 per year

• 1999: Mall expanded to 1600 shops & 600,000 registered members

• 1999 June: rename to Rakuten Inc. • 1999 Sept: start Rakuten Auction service• Rakuten make $5.7mil sales in 1999, earned $2.4mil

profits. • 2000 : start Rakuten University teaching e-business • Rakuten went public in Jasdaq in Apr 2000 with market

capital of $3.1 billion (45% own by Mikitani & his wife)

• 2000: founded Rakuten USA Inc.Rakuten Books founded as JV with Nippon Shuppan Hanbai Inc. Infoseek Japan acquired by Rakuten Inc as portal services

• 2001: Showtime Inc for TV shopping • 2002: Rakuten travel Inc founded

Lycos Japan acquired by Rakuten & merged with Infoseek• 2003: MyTrip.net acquired by Rakuten

Start Rakuten Securities Inc by acquire DLJDirect SFG Securities• 2004: Acquired Minnano Shushoku for career business service Acquire Cyber Brains Consultancy to form Rakuten Research Acquire Aozora Card to form Rakuten Credit Founded Rakuten Baseball – Rakuten Eagle Baseball team

• 2005: Acquire Linkshare Corp (online marketing company) under Rakuten

USA Rakuten Auction Inc founded as JV with NTT Docomo Consolidate Kokunai Shinpan to structure Rakuten KC

• 2006: Rakuten sign ops tie up with Shinsei Bank for online mortgage & Tokyo Bank for online banking business

• 2007: Rakuten Inc celebrate 10th Anniversary Rakuten Travel open Guam branchFusion communication acquired by Rakuten to start IP Telephony Rakuten Bank@TTB was founded in alliance with Tokyo Tomin Bank

Rakuten move in to new HQ – Rakuten Tower Rakuten enter restructuring stage to further improve business efficiency

• 2007: Rakuten and Taiwan President Chain Store sign JV to start Rakuten Ichiba Taiwan

• 2008: Rakuten Europe open in Luxemburg as European Hub Rakuten start operation in Bangkok Thailand for travel business

The most successful e-business portal in Japan

240,000 orders a day

Merchants • Rakuten Merchants Server (RMS) • 40million of Rakuten members • Rakuten’s ECC (E-commerce Consultants) • Rakuten University Members • 20million items for selection • User-friendly interface • Rakuten super point program (loyalty card) • Safe shopping service

• May 7th 08 : Pre-opening• May 27th 08: Grand opening • Aug 6th 08: 440 shops & 160k members • Hot sales item: Ladies fashion & Japanese

products • Target 1000 shops by end 2008

Listed Items Monthly Rental Transaction Fees

Package 1 2,000 items NT$ 5,000 5%

Package 2 5,000 items NT$ 7,000 4%

Package 3 100,000 items NT$ 10,000 3%

Others Misc:

Training courses for Rakuten University -RMS Training (must attend) : NT$ 3,000

• Become the No.1 Internet Service company in the world – Future e-commerce will move from US & EU lead

to Asia leads, main reason is due to raising star from China and India consumers. Rakuten’s strategy to enter China market will determine if the company’ World No. 1 goal is achievable.

• Rakuten’s competitive advantages – Trusted Brand in Japan – Large subscriptions of members in Japan – Complete e-business eco-system in Japan – Large base of merchants in Japan

• Challenges for Rakuten ahead – Japan No.1 ≠ World No. 1 – Competition with Amazon (currently 80mil active members &

2million stores associated with Amazon) – Global economy downturn may slowdown its global expansion

(but may be a golden opportunity for its M&A strategy if the company is loaded with healthy cash-in-hand)