TechFaith and BEIID to Establish Joint Venture Company For Development of Production Line in Beijing

For this joint venture, TechFaith will invest RMB 300 million and BEIID will invest RMB 200 million for their previously announced the development of a 10 million-unit capacity smart phone production line in Beijing. TechFaith shall hold 60% of the shares and BEIID will hold the remaining 40% for the joint venture.

Mr. Li Xiao Ping, Executive Deputy General Manager of BEIID, commented, "We decided to replace the convertible bonds arrangement with a joint venture because we are looking more at the long term growth of the whole industry rather than short term gains, and a joint venture allows us to work more closely together for the long term. We believe with the increase coverage of 3G networks globally, the demand for smart phones will also increase."

Mr. Defu Dong, Chairman and CEO of TechFaith, said, "We appreciate the confidence and trust BEIID has expressed in Techfaith. The joint venture directly helps us in our goal of expansion and technology development. The additional capacity will also provide TechFaith a growth platform to meet the expected demand growth due to the fast increase in smart phone users globally. TecFace's rapid growth is in line with our expectations and we are confident that the smartphone business will continue to grow and become one of our major business segments."

About BEIID

"BEIID" is a PRC stated-owned investment and financing company headquartered in the Beijing Economic and Technological Development Area ("BDA"). It focuses on financing large scale strategic projects in the BDA and promoting the development of the hi-tech industry in the BDA, among other things.

About us

TechFaith (NASDAQ: CNTF) has three primary businesses. Under the TechFaith umbrella, the Company is a leading global ODP (Original Developed Product) mobile handset provider. Under its TecFace brand, the Company is a leading developer of specialized mobile phones for differentiated market segments, including the rapidly growing Smartphone market targeting Enterprise users and Operators through its QIGI brand; Outdoor and Sports enthusiasts through its Jungle brand; and the Teen market through licensed brands. Under the Company's 17Vee brand, the Company has built a leading, intellectual property based motion gaming business ranging from Bluetooth enabled motion gaming controllers and software to a recently launched proprietary set-top motion game box. For more information, please visit www.techfaithwireless.com , www.17vee.com and www.798game.com.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident," "outlook" and similar statements. Among other things, the business outlook and strategic and operational plans of TechFaith and management quotations contain forward-looking statements. TechFaith may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on Forms 20-F and 6-K, etc., in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about TechFaith's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, those risks outlined in TechFaith's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F. TechFaith does not undertake any obligation to update any forward-looking statement, except as required under applicable law.