1. BUS 576 -Dr. Chrite Senegal Mobile Telecommunications Industry

2. BUS 576 -Dr. Chrite Agenda I.Telecommunications in Africa II.Why Mobile Telecommunications? III.Why in Senegal? IV.Mobile Telecommunications in Senegal V.Market Strategy VI.Financial Analysis VII.Risks/Challenges

3. BUS 576 -Dr. Chrite I. Telecommunications in Africa Successful Privatization Teledensity is low –High Cost of infrastructure –Low GDP Increasing Mobile Penetration Mobile Telecommunications has high margins in West Africa

4. BUS 576 -Dr. Chrite II. Why Mobile Communications? Land-Line Infrastructure is suspect in Africa –Opportunity for substitute good –More reliable Profits are 20 – 40% in mobile comm. ROI at least 20% Pre-Paid strategy reduces paperwork, employees, and risk Pyramid Research

5. BUS 576 -Dr. Chrite III. Why Senegal?

6. BUS 576 -Dr. Chrite III. Why Senegal? (Cont.) GDP of $4.4 billion GDP-purchasing power parity (PPP) of $15.6 billion annual GDP/capita was $500 with a GDP/capita-PPP of $1,600. CONSUMER POWER!!! Low Inflation, Low Debt Free flow of capital for foreign investors

7. BUS 576 -Dr. Chrite III. Why Senegal? (Cont.) Push toward privatization –Auctioning off license in May 2002 –End of monopoly Moderate cellular phone penetration

8. BUS 576 -Dr. Chrite III. Why Senegal? (Cont.) Market Penetration of Addressable Market Penetration of Adult Population Cameroon37.51%8.25% Cote-d’Ivoire44.02%9.34% Ghana10.36%2.65% Nigeria21.98%6.00% Senegal41.21%11.04%

9. BUS 576 -Dr. Chrite III. Why Senegal? (Cont.) Stable government Government investment –Health –Education –Telecommunication Civil stability Strong Secondary and Tertiary Education Systems Healthy population growth –Low HIV/AIDS infection rate

10. BUS 576 -Dr. Chrite IV. Mobile Telecom in Senegal Market Growth and Access Stable government and society Developing Mobile Infrastructure Telecom and regulatory liberalization Profitable! Springboard for regional expansion

11. BUS 576 -Dr. Chrite V. Market Strategy Use existing infrastructure to wire Senegal –Base stations and cell towers Pre-paid Business Strategy Use existing points-of-sale –Local stores, restaurants, gas stations, etc. Roaming contracts with other GSM providers across the globe Expand coverage by adding additional towers over 5 years

12. BUS 576 -Dr. Chrite Projected Coverage Area

13. BUS 576 -Dr. Chrite VI. Financial Analysis

14. BUS 576 -Dr. Chrite VI. Financial Analysis

15. BUS 576 -Dr. Chrite VI. Financial Analysis

16. BUS 576 -Dr. Chrite VII. Risks/Challenges Technological Reliability Government Regulation –Inflated Licensing Fee –Across West Africa Competing with the government provider Alize Disposable Income Market Acceptance

17. BUS 576 -Dr. Chrite Conclusion Mobile Telecom in Senegal –Stable Government –Low penetration Market Opportunity –Senegal –West Africa Projected PV USD 34 million Manageable Risk with promising rewards

18. BUS 576 -Dr. Chrite Q&A