What are the modification needed to go through this step using Android Studio ?

Static classes have to be nested inside other classes. PlaceholderFragment is originally a nested class inside MainActivity class, when extracting it you can nest it inside the newly created SectionsPagerAdapter class for it to work.

I struggled with this for a few hours. Finally, Ben's answer here really helped me.

In SectionsPagerAdapter.java, change PlaceholderFragment to MainActivity.PlaceholderFragment so that it looks like this

@Override
    public Fragment getItem(int position) {
        // getItem is called to instantiate the fragment for the given page.
        // Return a PlaceholderFragment (defined as a static inner class below).
        return MainActivity.PlaceholderFragment.newInstance(position + 1);
    }

This allows it to reference the MainActivity for the PlaceholderFragment class.

Then in your MainActivity.java, make sure that your imports for Fragment, FragmentManager and FragmentPagerAdapter are referencing the v4 support library, like this

import android.support.v4.app.Fragment;
import android.support.v4.app.FragmentManager;
import android.support.v4.app.FragmentPagerAdapter;

Instead of any of them being

import android.app.Fragment;
import android.app.FragmentManager;
import android.app.FragmentPagerAdapter;

In the notes for this video, it tells you to update the FragmentActivity import, but not the others.

You may not need FragmentManager as it is grey (unused) in my project at this stage, but I left it there anyway as I am just glad that my app will run now.

I hope this helps. I was stuck with this same problem and this seemed to do the trick!