AN INTELLIGENT EDUCATION SYSTEM AND CONTENT PROVIDER 1 SECTIONS - - PowerPoint PPT Presentation

CHINA EDUCATION RESOURCES INC.

PRESENTATION AN INTELLIGENT EDUCATION SYSTEM AND CONTENT PROVIDER

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SECTIONS

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CORPORATE OVERVIEW

Introduction

BACKGROUND HIGHLIGHTS AND MILESTONES MANAGEMENT BACKGROUND

PROGRESS TO DATE

Section 1

TEXTBOOK PUBLISHING OVERVIEW ONLINE PRODUCTS OVERVIEW KEY PARTNERS & NETWORK GEOGRAPHICAL PENETRATION

ROADMAP

Section 2

FOUR STEP PLAN ROLLOUT PLAN

CER EDUCATION SMARTPHONE

Section 3

MACRO THEMES CHINA INTERNET MARKET MARKET OPPORTUNITY

A POWERFUL TOOL TO PARTNER WITH CER SCHOOL PLATFORM A UNIQUE APPROACH TO MEET THE NEEDS OF TEACHERS, STUDENTS, AND PARENTS AND ENHANCE SCHOOL PERFORMANCE A SOFTWARE PLATFORM HIGHLY SORT AFTER BY CHINA’S MOBILE PHONE CARRIERS

MARKET OPPORTUNITY Section 4

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CORPORATE OVERVIEW

Introduction

BACKGROUND HIGHLIGHTS AND MILESTONES MANAGEMENT BACKGROUND

CORPORATE OVERVIEW: BACKGROUND

Overview :

• Originally formed in 1997, Vancouver based China Education Resources Inc. (“CER” or the “Company”) is a public

listed company (TSX-V – CHN and OTCQX - CHNUF) and one of China’s leading providers of educational content and services.

• CER works with various educational authorities and organizations in China, including the Curriculum Development

Center (CDC) and the Chinese Society of Education (CSE).

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Management

• Chengfeng Zhou – Chairman and Chief Executive Officer
• Danny Hon – Chief Financial Officer
• Vivian Chen – Chief Financial Officer of China Operations
• Wu Yuquan – President of the Company’s China operation subsidiary
• Mr. Li Qi – Chief Executive Officer of the Company’s China distribution subsidiary
• Mr. Mu Weiguo – President of the Company’s China distribution subsidiary

School Platform Education Smart Phone Textbook Publishing Online Products Current Sales Of Products Programs To Expand

PRODUCT PORTFOLIO

CORPORATE OVERVIEW: HIGHLIGHTS AND MILESTONES

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• Product portfolio includes the largest K-12 teacher blog system in China which is
• n track to become the largest educational social media site in China.

Leader In New Digital Frontiers

• Over 1.3 million teachers, education professionals & students using CER’s blog

site.

Market Validation

• Operates the only internet portal co-developed with Ministry of Education’s

Curriculum Development Center (CDC) & The Chinese Society of Education (CSE)

Long-standing Key Relationships

• CER’s online products and textbooks are adopted in 14 provinces throughout

China

Growing New Product Suites

• Expanding to the School Platform and Education Smart Phone

Emerging Cross-Sell Opportunities

• First class expert teams of scholars, authors, teachers, instructional designers native

to China. 400 online teacher training courses, over 100,000 lesson plans, 5 million teacher’s articles

Access To High Quality Content

• Proven track record of doing business and navigating the regions challenging

geopolitical environment.

Geographical Expertise

CORPORATE OVERVIEW: MANAGEMENT BACKGROUND

Chengfeng Zhou – Chairman and Chief Executive Officer

• Chairman and Chief Executive Officer of China Education Resources Inc. Since 1997
• Previously served as president and director for the private investment holding company, Double Ocean Investments Inc.
• He also served as a director for Allied Pacific Properties and Hotels Ltd.
• He acted as an advisor to a number of companies in Ontario, British Columbia and China. Committed to the fields of

financial, technology and global education.

• Committed to the fields of financial, technology and global education. Mr. Zhou was a lecturer at Beijing United University

for seven years.

• In 1983 he obtained his Bachelor of Philosophy degree from the People’s University of China in Beijing, and from 1990 to

1991 he studied business in the Faculty of Business Administration of Memorial University of Newfoundland. Danny Hon – Chief Financial Officer

• Chief Financial Officer of China Education Resources Inc. since October 4, 2007. He also
• Served as Director and/or Chief Financial Officer of various public companies listed in Canada and United States.
• He has over 20 years experience in accounting and finance.
• He has been an Associate Member of The Certified General Accountants Association of Canada since 1994 and has been a

Certified Financial Planner since 1998. He is a Fellow of The Association of Chartered Certified Accountants of the United Kingdom in 1992 and the Hong Kong Institute of Certified Public

• Mr. Hon received his Master of Science in Administration from Central Michigan University in 2000. Mr. Hon is fluent in

English and Chinese Mandarin.

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PROGRESS TO DATE

Section 1

TEXTBOOK PUBLISHING OVERVIEW ONLINE PRODUCTS OVERVIEW KEY PARTNERS & NETWORK GEOGRAPHICAL PENETRATION

PROGRESS TO DATE: TEXTBOOK PUBLISHING

• Process: Products are created in collaboration/
• versight with various education authorities
• Subjects: Green Certificate, General Skill, Ethic, Arts,

Music, Career Planning

• Target: Primary and secondary
• Competitive advantage: One of the few private entities

to publish education textbooks in China’s K-12 public school system

• Customers: Public schools (mandated curriculum)
• Key advantages: Dependable revenue stream, Limited

risk, Paved key Relationships & Enhances brand reorganization ■ Note: Some sales are allocated to digital textbook sales in 2012. The textbook sales continue to grow in 2013

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Roadmap

• Historically textbooks have accounted for the majority of the companies sales, moving forward management expects this

business to continue to grow but the company’s focus will largely be on interactive digital products

• As the popularity of interactive products continue to grow the company sees excellent cross sell opportunity to bring

textbook customers into online high-margin digital products

$164 $2,315 $3,685 $4,365 $3,653 $5,733 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 2008 2009 2010 2011 2012 2013

Textbook Sales (K)

PROGRESS TO DATE: ONLINE PRODUCTS OVERVIEW

• Product: Training platform and content distribution

(Online & Text)

• Subjects: All key subjects such as Chinese, Math,

English, physics, chemistry, history, etc.

• Primary Source of Revenue: Sales of teaching modules

and seminars

• Target: K to 12 sector
• Competitive advantage: The only public company

endorsed by MOE for national level online teacher training

• Customers: Provincial education authority, Municipal

education authority, teachers, students and central government authority (Ministry of Education)

• Key advantages: Connect with customers on a

personal basis, cross sell existing products, build relationships with young educators.

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Highlights

• Teacher Training: More than 500,000 K-12 teachers trained since 2006
• Teacher Platform: More than 100,000 K-12 online lesson plans, course modules.
• Operates the largest K-12 teacher blog system in China which is on track to become the largest educational social media

website in China

• Adopted in 14 provinces throughout China and the portal has over one million teachers registered.
• Expanding to the School Platform and Education Smart Phone

$313 $475 $1,751 $2,188 $3,738 $4,353 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 $5,000 2008 2009 2010 2011 2012 2013

Online Products (K)

PROGRESS TO DATE: PARTNERS AND NETWORK

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School Platform Program

Education Department of Guangxi Education Department of Guizhou Province Education Department of Shanxi Province Chongqing Municipal Education Commission Education Department of Yunnan Province Education Department of Hunan Province Education Department of Sichuan Province Education Department of Henan Province Ministry of Education, China Education Department of Heilongjiang Province Education Department of Liaoning Province Education Department of Anhuii Education Department of Qinghai Province Education Department of Inner Mongolia Education Department of Shaanxi Province Education Department of Shanxi Education Department of Liaoning Education Department of Guangxi Teaching & Research Institution of Education-Gansu

Online Training and Services

Tongxin Publishing House

Guangdong Xinyue Textbook Research Development Co. China Map Publishing House Shandong People’s Publishing House Guizhou Nationality Publishing House China Archives Publishing House Encyclopedia China Phoenix Publishing House

Textbook and Supplementary Materials

As a trusted partner in China, CER has long-time relationship with various education authorities and some of the most influential publishers

Ed Gansu Province

CER Smart Phone

Xinjiang Uygur Autonomous Region Education Department of Gansu Province

PROGRESS TO DATE: GEOGRAPHICAL PENETRATION

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CHONGQING

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XIANJIANG QINGHAI ANHUI GANSU GUANGXI GUIZHOU HEILONGJIANG HENAN HUNAN INNER MONGOLIA LIAONING SHAANXI SHANXI SICHUAN YUNNAN

The company has made significant progress in expanding its geographical footprint.

• The shaded red areas below represent provinces where the company is in activity.

PROGRESS TO DATE: SALES AND MARKETING

Actionable Feedback

• The salesforce serves a critical role as a liaison

between educational authorities and The Company

• The salesforce plays a key role in identifying new
• pportunities and developing future products

Marketing Channels

• The increasing popularity of the company’s portal,

internet portal, www.cersp.com creates an inexpensive additional cross sell opportunities

• Organic growth through word-of-mouth/teacher

recommendations

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Overview

• Tightly knit team of sales professionals based in mainland China
• Uniquely first hand understanding the Chinese educational market
• Proven track record of closing deals and growing revenue
• Over a decade of experience in the region, has enabled the team to build long-standing relationships and

understand/identify key decision-makers

• Sales team members are trusted partners in recommending products to officials

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ROADMAP

Section 2

FOUR STEP PLAN ROLLOUT PLAN

ROADMAP: FOUR STEP PLAN

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• Relationships built through the successful textbook

publishing business are critical to the digital growth strategy

• Connecting classroom teachers with recognized

experts in their subject areas

• Highly relevant to teachers’ daily job
• Participatory and interactive, Active learning
• Building communities of practice
• Endorsement of the ESP by schools for use by

teachers

• Collaboration of teachers in various regions
• Video database of actual classroom teaching records
• Support the teachers’ administrative, teaching,

learning, testing and assessment needs

• Integrate into teachers’ daily routine
• Interact and communicate with experts and other

teachers

• Comprehensive social network for use by teachers

to support their administrative, teaching, learning, testing and assessment needs

• Education resource center
• Online tutoring
• Homework system
• Interaction with teachers and parents
• Communication among students
• Educational games
• Formative assessment
• Customized resources

Step One: Online Teacher Training Program Step Three: School-based Platform for Teachers Step Two: Online Teaching & Research Platform Step Four: School-based Platform for Students

ROADMAP: ROLLOUT PLAN

• Leverage current relationships and distribution networks to sell new products
• Leverage China Telecom and current direct relationships and distribution networks to sell the

smart phone program in various cities (China Telecom has 2,000 sales directors across the country)

• Focus on expanding the digital product portfolio
• Set up “show case” schools of the program in each major city (CER program has shown improved

academic performance by class)

• Partner with the academic divisions of various education authorities and promote through the

education conferences organized by the local education authorities

• Provide a more robust “online/offline” mutually complementary solution
• Expand products into different segments of the K-12 education system

ROLLOUT PLAN Textbook Publishing School Platform

Current Sales of Products

Online Products

Education

Smart Phone

Programs to Expand

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CER EDUCATION SMARTPHONE

Section 3

A POWERFUL TOOL TO PARTNER WITH OUR EXISTING FULLY APPROVED CER SCHOOL PLATFORM SYSTEM A UNIQUE APPROACH TO MEET THE NEEDS OF TEACHERS, STUDENTS, AND PARENTS ENHANCING SCHOOL PERFORMANCE A SOFTWARE PLATFORM HIGHLY SORT AFTER BY CHINA’S MOBILE PHONE CARRIERS

A POWERFUL TOOL TO PARTNER WITH CER SCHOOL PLATFORM

• A power tool to partner with our existing fully approved CER school platform system
• A unique approach to meet the needs of teachers, students, and parents enhancing school

performance

• CER migrated their programs into an interactive digital system that is deployed through their

proprietary software to mobile phones as the user interface

• Through the CER Smart Phone, the system automatically analyzes and provides instant

reports and feedback to teachers, students and parents

• A software platform highly sort after by China’s mobile phone carriers - the company

executed a revenue share and carrier distribution agreement with China Telecom

WHAT THE CER SMART PHONE DOES

• A significant breakthrough in the education information network in China.
• Intelligent instant analysis from the CER system helps students and teachers on the problems encountered

by each student and improves the interaction between the teacher and his/her students for improved academic performance in the classroom.

• While mobile phones are banned in China classrooms the CER smart phone is approved since it only allows

the CER program to operate in the classroom environment (no other apps) . Outside of the classroom

• perates as normal smart phone.
• Allows teachers to address issues arising during the course in real time and make adjustments required to

further improve their own courses.

• Based on the intelligent instant analysis on the level of understanding of a topic by the students, teachers

can adjust the time to be spent on each topic resulting in a true high performance classroom.

• While the students complete their assignments within a specified time through the CER smart phone, our

system automatically analyzes and provides instant reports and feedback to teachers, students and parents.

• Immediately after our intelligent instant analysis, areas of weakness of each subject of individual student

are identified and the related supplementary study materials will be automatically pushed down to the student’s cellular phone for further studying.

• Highly supported by mobile carriers due to scalability.

GOAL: PERSONALIZED LIFETIME LEARNING AND DEVELOPMENT PLATFORM

CER Education Smart Phone Personalized Lifetime Learning and Development Platform

• Lifetime Learning platform

Users will build their e-portfolio of lifelong learning and career development based on their own individual

• characteristics. Users not only complete the study required by the school, but also according to the platform's analysis to

get the appropriate support and service for their own development of both academic and future career.

• Presentation Platform

Long-term accumulation of personal data and file will make the most comprehensive and complete self-ability to present in the best form to different requirements.

• Talent and Career Platform

As a lifetime learning platform, it is natural to form a huge data accurately all kinds of talents and capabilities.

• Family as a social platform for vertical diversification ties

Each member of the user’s family will independently develop their own various social network . According to each user's

• wn characteristics, preferences, academic and career development, the platform can help users more effectively

establish and perfectly meet their social needs. The platform digitizes the family unit of the real world to the virtual world.

Implementation Path

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MARKET OPPORTUNITY

Section 4

MACRO THEMES CHINA INTERNET MARKET MARKET OPPORTUNITY

MARKET OPPORTUNITY: MACRO THEMES

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2% 3% 5% 6% 7% 9% 11% 16% 23% 29% 34% 0% 5% 10% 15% 20% 25% 30% 35% 40% 2000A 2001A 2002A 2003A 2004A 2005A 2006A 2007A 2008A 2009A 2010A

Internet users as percentage of population: China

4% 7% 11% 17% 19% 22% 28% 0% 5% 10% 15% 20% 25% 30% North America Western Europe Middle east Africa Latin America Eastern Europe Asia

2010-2015 Worldwide Self-paced eLearning Five-year Growth Rates by Region

20% 20% 24% 25% 27% 28% 38% 42% 52% 57% 0% 10% 20% 30% 40% 50% 60% Columbia Ukraine Indonesia Brazil Czech Republic Poland Romania Malaysia China India

2010-2015 Worldwide Self-paced eLearning Five-year Growth Rates by Ten Countries

Emergence of E-Learning

• According to Ambient Insight,

the Self-paced eLearning products and services market globally was approximately $32.1 billion in 2010.

• The overall market is projected to

grow at a CAGR of 9.2% (2010- 2015) to $49.9 billion in 2015. China’s Online Presence

• China’s online presence

continues to grow rapidly

• As this trend continues so will the

adoption of online education

2000 2012

China

22,500,000 564,000,000

United States

95,354,000 245,203,319

India

5,000,000 121,000,000

Japan

47,080,000 101,228,736

Brazil

5,000,000 81,798,000

Germany

24,000,000 67,364,898

Russia

3,100,000 61,472,011

Indonesia

2,000,000 55,000,000

United Kingdom

15,400,000 52,731,209

France

8,500,000 50,290,226 Internet Users Country

China Internet Market

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MARKET OPPORTUNITY

Key Government Initiatives

• China’s Central Government has committed to allocate

4% of Chinese GDP to education annually (approximately USD$328 billion annually)

• In 2011, China achieved this goal, and included the

figure in its publicly released budget for the first time.

• The Ministry of Education is currently concluding a ten

year plan which would result in the allocation of 10% of the annual education expenditure towards education digitalization

China K – 12 Market

• 400,000 schools
• 12 million teachers
• 230 million students

CER Potential Market

• 223,000 schools
• 5.6 million teachers
• 101 million students

CER Initial Target Market

• 102,000 schools
• 2.3 million teachers
• 47 million students