1. Dr. Georges H. Bongi Group Executive Marketing and Strategy
Wednesday, 03 April 2019
Dr. Georges H. Bongi
Group Executive Marketing and Strategy
Tel.Com Conference – 23 October 2002
MTN Business Solutions 12 Sept 2002

2. Agenda
The Realities of Today
The Changes
The Future

3. The Realities of Today The Facts
Market
Reaching a saturation level but !
As in many mobile markets, increased competition has driven Average Revenue per User down
ARPU
Voice and SMS
Products
Distribution
and Cost of Sales
Essentially retail
Very high subsidisation
Customer
Services
Focus on services level and not on agent expertise

4. Penetration and Income Levels
Wednesday, 03 April 2019
International Market Overview Market Penetration and Growth
Penetration and Income Levels
Annual GDP/capita
$10000+
$ $10000
$ $2999
Up to $1499
Penetration
Source: Merrill Lynch estimates for EOP 1Q2002 from ‘Wireless Matrix’,
June 2002
‘All Africa’ figure from Informa (March 2002 data)
MTN Business Solutions 12 Sept 2002

5. South Africa Market Overview Subscribers’ Base, Growth and Penetration
Source: Pyramid Research

6. The Realities of Today The Facts
Market
Reaching a saturation level but !
As in many mobile markets, increased competition has driven Average Revenue per User down
ARPU
Voice and SMS
Products
Distribution
and Cost of Sales
Essentially retail
Very high subsidisation
Customer
Services
Focus on services level and not on agent expertise

7. Minutes of use (mins/subs/month)
Wednesday, 03 April 2019
International Market Overview ARPU and Minutes of Use
ARPU ($/month)
Minutes of use (mins/subs/month)
Source: Merrill Lynch estimates for 1Q2002 from ‘Wireless Matrix’, June 2002
No data available
Source: Merrill Lynch estimates for 1Q2002 from ‘Wireless Matrix’, June 2002
MTN Business Solutions 12 Sept 2002

8. Wt. Average of 45 Countries
International Market Overview ARPU Evolution
Mobile Operator ARPUs
US$
Regional ARPU Trends
STABILISING in Europe and South Africa
RISING in part of Asia
DECLINING in the Americas
1999
2000
2001
2002
Wt. Average of 45 Countries
Source: Merril Lynch, Wireless Matrix, 1Q02

9. The Realities of Today The Facts
Market
Reaching a saturation level but !
As in many mobile markets, increased competition has driven Average Revenue per User down
ARPU
Voice and SMS
Products
Distribution
and Cost of Sales
Essentially retail
Very high subsidisation
Customer
Services
Focus on services level and not on agent expertise

10. The Realities of Today The Facts
Market
Reaching a saturation level but !
As in many mobile markets, increased competition has driven Average Revenue per User down
ARPU
Voice and SMS
Products
Distribution
and Cost of Sales
Essentially retail
Very high subsidisation
Customer
Services
Focus on services level and not on agent expertise

11. International Market Overview Handset Subsidies & Cost Per Gross Add
Wednesday, 03 April 2019
International Market Overview Handset Subsidies & Cost Per Gross Add
US$ (Approximately) No
CPGA
data 70 60
Note (*): M-Cell handset subsidy: Goldman Sachs report, February 2002; no data one CPGA
Source: Morgan Stanley, ‘Global Telecom Outlook’, June 2002
MTN Business Solutions 12 Sept 2002

12. The Realities of Today The Facts
Market
Reaching a saturation level but !
As in many mobile markets, increased competition has driven Average Revenue per User down
ARPU
Voice and SMS
Products
Distribution
and Cost of Sales
Essentially retail
Very high subsidisation
Customer
Services
Focus on services level and not on agent expertise

13. Agenda
The Realities of Today
The Changes
The Future

14. Convergence of Industries
Wednesday, 03 April 2019
The Changes
Convergence of Industries
Data
Telecom
Industry
Mobile Voice
Fixed Voice
Internet
PC-LAN
Infocom
Industry
Computer Industry PC
Desktop computing
Main frames
Media Industry
Electronic publishing
We can currently observe a convergence of the telecommunications, computer and media industries into the so-called Infocom industry.
Disappearing demarcation between local and remote computing devices, desktop video conferencing or voice over IP are just a few examples of the integration between the telecommunications and the computer industry.
The media industry has recognised the huge potential of this emerging technical infrastructure and trying to exploit it by bringing electronic content to the consumer.
To remain competitive in this converging environment of rapid (technological) change and almost unlimited opportunities, it is imperative for MTN to find a market position where they can differentiate themselves from the competition.
Entertainment
To remain competitive as a telecom player, MTN will develop a position in the emerging convergence market
Source: Ericsson
MTN Business Solutions 12 Sept 2002

15. Communication is at the heart of people’s lives
Wednesday, 03 April 2019
The Changes
Calling The Next Generation
Communication is at the heart of people’s lives
As a result, the mobile phone is infused with rich new meaning
MTN Business Solutions 12 Sept 2002

16. The Changes The Changing Face of Communications
Wednesday, 03 April 2019
The Changes The Changing Face of Communications
People to People
People to Devices
Devices to Devices
Homes
Appliances
Buildings
Computers
People
Transportation
Vehicles & Systems
Intelligent
Subscriber Devices
This presentations will provide a complete overview of the heritage of wireless networks and the growth areas especially those with an increasing dependence on Data. Data, not only as a means of accessing the Internet but also as the technology that will help negate our dependence on traditional Central Office based switching technologies.
Once the cost of radios come down, inanimate object will be able to communicate and now instead of SPs thinking in terms of 100’s of subscribers, they will now think in terms of 100’s of thousands. Telematics (think electric meters in homes, cars etc.) will drive a whole new scale of operation.
We will also review the ways competing wireless technologies are positioning themselves for the move to Packet Data and show how Lucent leverages common platforms to enable common solutions that benefit any customer regardless of their technology choice.
Vending
Machines
Multiple Connections per Person
Networking Embedded in Household and Business Devices
“Always On, Always Connected”, At Home, At Work, and On the Go
MTN Business Solutions 12 Sept 2002

17. Data “Take-rates” The Changes Video MMS SMS
Increase in services and applications
Subscriber penetration %
Video
MMS
SMS
Time from Launch
Successful Data Products will require faster
subscriber take-rates than their Predecessors!

18. Operators’ Challenges
The Changes
Operators’ Challenges
Rate of Innovation
Optimum
Return
High
Loss of return
Medium
Loss of opportunity
Low
Rate of Market Acceptance
Low
Medium
High

19. Agenda
The Realities of Today
The Changes
The Future

20. Life Enhancement Tools: Devices
Wednesday, 03 April 2019
The Future
Life Enhancement Tools: Devices
MTN Business Solutions 12 Sept 2002

21. SUCCESS VOICE SMS MMS VIDEO MUST Mobile Services’ Evolution The Future
Availability of
Solutions
VOICE
SMS
MMS
VIDEO
Connectivity /
Internet Access
MUST

22. International Data Penetration
The Future
International Data Penetration
Data as % of ARPU %
Significant
Europe: 10-15%
SA: 3%
Selected Countries - 3 / 2002
Source: Merril Lynch, Wireless Matrix, 1Q 2002

23. Consolidated ARPU Projection
The Future
Consolidated ARPU Projection %
Shares of ARPU

24. Beyond the Price Plan The Future: Consumer Segment
The World of Voice & SMS
Price Plan
The World of Applications
Content is the Differentiator
Price Plan is the Differentiator

25. The Future: Business Segment Defining the Products Requirement
Divergent worker profiles utilise unique computing and communication technology to fulfil their function
Mobility of the Device
Handset
GSM
PDA
Laptop
Desktop
Executives
Rovers
Knowledge Workers
Providing distributed access improves on-the-job productivity
Desk-
bound
Distributed nature of connections
Wired WAN
Wireless WAN
Wireless LAN
Wired SYNC
Wired LAN
Source: Ovum

26. The Future: Business Segment Data Positioning
Wednesday, 03 April 2019
The Future: Business Segment Data Positioning
MTN Applications
Office X-Change
Instant Office
Telemetry Applications
Messaging Applications
M-Commerce Applications
MTN Networking Solutions
Internet/ Intranet Access
Integration, data cost, security
MTNdataLIVE (GPRS))
Always on line
MTNdataFAST (HSCSD)
Speed
MTN Data Solutions
Value Proposition
MTNdataMESSAGE (SMS)
Universal Access
MTNdataLINK (CSD)
Basic data transfer
MTN Business Solutions 12 Sept 2002

27. The Future: Business Segment Generic vs Specific Applications
Examples:
G1 = Office Xchange
G2 = Corporate Access
IS1 = Fleet management
IS2 = Navigation assistance
BS1 = Wireless patient monitoring
Solution
Generic 4 G4
Industry Specific
IS4
Business Specific
BS4
Generic 3 G3
Industry Specific
IS3
Business Specific
BS3
Industry Specific
IS2
Generic 2 G2
Business Specific
BS2
Industry Specific
IS1
Generic G1
Business Specific
BS1
MTN multi-server plan
DataLIVE
DataFAST
DataMESSAGE

28. Network and Solution Partners
The Future: Service Delivery MTN and Partners
Network and Solution Partners
Ericsson
Understanding the need of the business user
Microsoft
AST
Comparex
Develop and market horizontal and vertical solutions for improved productivity
Third party developers
Network Service Providers
LEAF
Integrate with MTN network
Integrate solutions within corporate systems
Integrated Service Delivery and Support

29. The MTN journey to the Future has already started !
Summary
Potential rebound thanks to new technology and data
Market
Data and usage stimulation
ARPU
From Voice to Video and Business Solutions
Products
Evolution of channels to match technological evolution
Distribution
and Cost of Sales
Increase ability to support more complex products
Customer
Services
And…
The key of success for content
Partnership
The MTN journey to the Future has already started !

30. The best way to predict the Future . . .
Wednesday, 03 April 2019
The best way to predict the Future . . .
(Introduction to the video)
is to create it
Peter Drucker
MTN Business Solutions 12 Sept 2002