1. Next Generation Services A Pillar for Growth in ICT Daniel Shepherd Director Information & Communication Technologies

2. 2 Despite value created historically, the communications industry continues to face critical challenges Growing customer base and build-out network, introduction of pre-paid Introduction of WAP, GPRS, mobile internet, e-/m-commerce Markets with low penetration: Markets reaching saturation: Key challenges remain: Voice revenue continue to fall Markets are saturated Competition is intensifying The killer app story failed Past growth strategies:

3. 3 Depressed growth expectations lead to lower valuations To improve valuations, the industry needs to generate strong cash flows and create new growth expectations Share price – rebased Source: Yahoo Finance, Frost & Sullivan analysis Share Price Analysis, 1999 - 2009

4. 4 We believe that incremental value can be attained by leveraging existing assets Earnings Time Reducing churn Increasing revenue from the existing customer base, both from voice and data Running efficient and effective operations Evolve data usage through 3G+ network and services FOCUS Existing business Local acquisitions Entry into new products and/or segments Entry into new markets New business

5. 5 1G (First Generation) -- First true mobile phone system Featured analog voice signaling. Each call used a separate frequency or radio channel. Examples AMPS TACS NMT 1G (First Generation) -- First true mobile phone system Featured analog voice signaling. Each call used a separate frequency or radio channel. Examples AMPS TACS NMT 2G (Second Generation) Features digital voice encoding Increased bandwidth Limited data transmission primarily through circuit switching and some packet routing Introduces multimedia Examples CDMA/CDMA One TDMA GSM GPRS (2.5G) EDGE (2.5G) 2G (Second Generation) Features digital voice encoding Increased bandwidth Limited data transmission primarily through circuit switching and some packet routing Introduces multimedia Examples CDMA/CDMA One TDMA GSM GPRS (2.5G) EDGE (2.5G) 3G (Third Generation) Features enhanced multimedia (voice, streaming video/ audio remote control) Broad bandwidth High rates of data transmission using both packet and circuit- switched networks Roaming capability across Europe, Japan, North America Examples CDMA2000/1xEVDO UMTS/WCDMA TD-SCDMA HSDPA HSUPA HSPA Evolved (HSPA+) 3G (Third Generation) Features enhanced multimedia (voice, streaming video/ audio remote control) Broad bandwidth High rates of data transmission using both packet and circuit- switched networks Roaming capability across Europe, Japan, North America Examples CDMA2000/1xEVDO UMTS/WCDMA TD-SCDMA HSDPA HSUPA HSPA Evolved (HSPA+) 4G (Fourth Generation) -- Being defined Expected to feature end-to-end IP and high-quality streaming video High rates (100 Mbps or more) of data transmission using only packet-switched transmission protocols Simultaneous connections to multiple high-speed networks May use WiMAX II LTE 4G (Fourth Generation) -- Being defined Expected to feature end-to-end IP and high-quality streaming video High rates (100 Mbps or more) of data transmission using only packet-switched transmission protocols Simultaneous connections to multiple high-speed networks May use WiMAX II LTE Late 1970s-1980s 1990s 2000s-now 2010 and beyond Sources: http://whatis.techtarget.com, http://www.webopedia.com The industry’s ability to deliver innovation through new technologies is key

6. 6 The Middle East, with largely saturated yet affluent markets, is a case in point Source: Frost & Sullivan` Per Capita Income vs Mobile Penetration, 2008 – Selected Middle Eastern Countries

7. 7 The high-level of prepaid subscriptions creates further complexity UAE leads among all other MENA and South Asian countries both in terms of mobile penetration and Prepaid subscription.

8. 8 Liberalisation of the telecom sector High penetration of mobile services Diversification from oil based economy Reduced regulatory barriers to competition and government policies encouraging broadband penetration Setting up of free zones and other government initiatives is leading to several emirates evolving as the key business destinations as well as a regional hub for ICT in MENA High per capita incomes and a high percentage of young population has translated into a consumer base receptive towards embracing new products and services Consumer willingness to adopt new technology Lack of fixed line network infrastructure Lack of well established fixed line network has delayed the availability of technology services Limited players in the NGS value chain High mobile penetration in the region provides a large customer base and market potential for value added services Reduced number of players in the value chain has hindered the ability to tap the market potential Government initiatives, regulatory compliance, soaring adoption and innovative business models are bound to drive Middle East markets

9. 9 We live in an increasingly converged world Communications Technology IP Mobile PSTN Entertainment Our Converging World Advertising Media Computing (IT)

10. 10 UMPCs & Smartphones Unified Communication across various devices/applications with synchronized updates Relaying real-time presence information across various devices and applications Convergence fuels demand for next generation services Source: Frost & Sullivan`

11. 11 Global Mobile TV Overview Mobile TV Case Studies Australian incumbent operator Telstra has successfully deployed mobile TV 21% of Telstra’s total 3G base has tried mobile TV at least once Uptake has been boosted by Telstra’s 7.2Mbps HSPA network Users watch 54 minutes of TV per months, usually in short bursts of under 2 minutes On average, mobile TV subscribers add A$11 to their ARPU every month Orange, France reports that over 50% of its 3G users have accessed mobile TV at some point 3 Italy reported over 600,000 mobile TV subscribers as of May 2007 The operator also reports that ARPU of mobile TV users is 60% higher than that of non-users High speed HSPA network and a large channel bouquets have proved to be critical factors in success of mobile TV, as illustrated by Telstra (Australia), Orange (France) and 3 (Italy) A. Telstra’s Channel Bouquet B. 3’s Mobile TV Usage Pattern C. Orange’s Mobile TV Bouquet Source: Company information, Frost & Sullivan analysis

12. 12 3G Mobile TV is increasingly gaining traction globally Source: Alcatel-Lucent

13. 13  Always on connection  Higher Speed connections  Unlimited usage  Overall better Quality of Experience  Access to services anywhere  Access to services through any terminal  Same Quality of Experience as broadband wireline  Enjoy new communicating devices End-users have High Expectations Broadband Wireless End-user (consumer) evolution accentuates demand … Going Broadband “Going Fast and with quality” Going Wireless … “My services everywhere”

14. 14 Applications for the Consumer Market Consumer Benefits Ability to download or upload multimedia content from the Internet Access to specialized applications Roaming capability Mobile Broadband Internet Access High-quality voice transmission

15. 15 Applications for the Consumer Market Additional Consumer Benefits Fast download/upload speeds Freedom from wires Much better quality of service, reliability No need to find WiFi hotspot, Internet café Use same phone while traveling More ways to keep in touch with friends, family Provides access to work resources when you are away from the office Work any time, anywhere