Turin – April 17th, 2007

Fastweb’s Business Modelin the peculiar case of the Italian market

PG. 2

Fastweb NGN investments

Fastweb’s role on the Italian broadband market

Italian NGN deployment

Regulation sustaining investments and innovation

Agenda

PG. 3

What is an NGN?

g A Next Generation Network (NGN) is a packet-based network able to provide services including Telecommunication Services and able to make use of multiple broadband, QoS-enabled transport technologies and in which service-related functions are independent from underlying transport-related technologies. It offers unrestricted access by users to different service providers. It supports generalized mobility which will allow consistent and ubiquitous provision of services to users

< ITU-T Recommendation Y.2001 (12/2004) - General overview of NGN>

Since 2000 Fastweb Network is NGN Compliant:bPacket-basedbQoS-enabledbIndependent from technologiesbOpenb4P ready

PG. 4

Core Network and Access Network

Access Network Home/OfficeCore NetworkServices

IP Core Network

FTTH

xDSL ULL / WS

WI-MAX

Voice, data and video

Fastweb NGN Network

MVNO

PG. 5

Fastweb Network in figures

Milano

Tokyo

21500 KmNew York

Los Angeles

Milano

Tokyo

21500 KmNew York

Los Angeles

23.500 km

4 billion euros invested since 1999 45% population coverage130 local areas

10.000.000 home passed850 Local Switches with ULL23.500 km network

PG. 6

Fastweb Metropolitan Area Network

FTTx Access

Mini PoP

CentralOffice

Large Business Access

Large Business Access

xDSL Access

Long Dist

ance

LD PoP

Metro PoP

MetropolitanArea Network

GigaEthernetRing

BB Equipment

LocalInterconnection

to TI PSTN Network

PG. 7

Innovative networks and innovative services on traditional network: from bundle to convergence

Diversification

Inte

grat

ion

commercialbundledoffers

advancedservices

convergentservices

Bundled services

POTS

Internet

IPTV

VoIP

Communication services on TV

voice/video callsMail box

Hybrid phone

Multimediaconference

Autoproduction andContent sharing

Presenceservices

New IP services Roadmap

PG. 8

Drivers for Bandwidth Demand

g Bandwidth demand is driven by Triple Play of VoIP, IP Video and Internetg Network Bandwidth dominated by IP Videog Access, Metro and Core

Internet Bandwidth

ICC Bandwidth

PiP Bandwidth

VoD Bandwidth

MulticastBandwidth

0

10,000

20,000

30,000

40,000

50,000

60,000

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

kbps

IP Video

Internet

VoIP

0

30,000

60,000

90,000

120,000

150,000

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Mbp

s

0

PG. 9

Fastweb NGN investments

Fastweb’s role on the Italian broadband market

Italian NGN deployment

Regulation sustaining investments and innovation

Agenda

PG. 10

Fastweb snapshot (FY 2006)

g Customer Base: 1.062.400

g Revenues: 1.260 (€mln)g 40% consumer

g 60% business

g EBITDA: 425 (€mln)

g EBITDA Margin: 34%

g CAPEX: 529 (€mln)

PG. 11

Fastweb services

g “Triple-play” offer is ready for MVNO and WiMax

Super ADSL 20 Mbps “Easy” offer New Videostation SKY IP-Tv

Con

sum

erB

usin

ess

EasyDouble Play

VPN - Fast.CompanyInternet – Fast.Net(from 1 Mbps to 10 Gbps)

Fast.VoIP IP CentrexManaged e Hosted

IP PABX

VDC HD

POTS/ISDN

BackboneIP MPLS

BackboneIP MPLS

PSTNPSTN

iMSSiMSS

POTS/ISDNPOTS/ISDN

BackboneIP MPLS

BackboneIP MPLS

PSTNPSTN

iMSSiMSS iMSSiMSSiMSSiMSSPSTNPSTN

BackboneIP MPLS

BackboneIP MPLS

iMSSiMSS

PSTNPSTN

BackboneIP MPLS

BackboneIP MPLS

iMSSiMSS iMSSiMSSiMSSiMSS

LAN

LAN

LAN

LAN

LAN

pop

pop

pop

poppop

pop

LAN

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

LAN

LAN

LAN

LAN

LAN

pop

pop

pop

poppop

pop

LAN

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PABX

PG. 12

Fastweb, the first IPTV provider

2001 2002 2003 2004 2005 2006

PG. 13

FASTWEB11%

TI Wholesale13%

TI Retail71%

Other OLOs 5%

TI Retail67%

FASTWEB13%

Other OLOs7%

TI Wholesales

13%

Market Share of Broadband Market

Italian Broadband Connections and Market Shares

6.8 Million EoP 2005

Source: FASTWEB Elaboration on Analysts' Estimates

~ 8.4 Million EoP 2006E

FASTWEB is increasing its share in the broadband arena, exploiting the enlarged footprint and the enhanced product portfolio

The company consolidated its positioning as the real alternative to the incumbent

PG. 14

ADSL WS and CVP

FTTH

INDOOR

OUTDOOR

Fastweb strategic choices

ADSL ULL

20061999-2002 2002-2005 2007-20082007 2008+

WI-MAX

GPON / VDSL

MVNO

WI-MAX

PG. 15

Fastweb NGN investments

Fastweb’s role on the Italian broadband market

Italian NGN deployment

Regulation sustaining investments and innovation

Agenda

PG. 16

Geographic deployment and digital divide (today)

cities800 5000

FTTB

33%

Population

10%

ADSL Wholesale 12%

8100

ADSL ULL

Digital Divide

45%

40

Bandwidth ∞ 0 Mbit/s

PG. 17

Geographic deployment and digital divide (tomorrow)

Cities100 2000

FTTB50%

WiMAX / ADSL WS

20%

ADSL ULL

FTTx (Node, Cabinet) 30%

81001 Mbit/s∞Bandwidth

Population

PG. 18

Fastweb NGN investments

Fastweb’s role on the Italian broadband market

Italian NGN deployment

Regulation sustaining investments and innovation

Agenda

PG. 19

Regulatory innovation for technology innovation

g The aim of regulation should be to promote a competitive environment, investments and technological innovation

g Regulatory Innovation and not Regulatory Holiday

g Today the goals should be:

g NGN development

g Convergent services

g Contents regulation

PG. 20

What kind of regulatory approach

g Regulation should promote “competition among networks” to develop innovation in services

g The “NGN context” reproduces same environment as mobile networks start-up

g “Mobility Premium” has allowed the development of plurality of networks (in Italy: three 2G and four 3G)

g A “Broadband Premium” could promote NGN development

SAME RULES IN SAME CONTEXTS

COST ORIENTED REGULATION FOR

INTERCONNECTION

SYMMETRIC REGULATION

PG. 21

Termination charges

g Fastweb reverse termination revenues are 18% of its network investment depreciation, while, for an example, TIM’s annual termination revenues are more than 420% of its network investment depreciation

g MNO has already recovered most of its starting network investment and so current high mobile termination rates represent a source of extra-profits

02468

1012141618202224262830

….. 2000 2001 2002 2003 2004 2005 2006 2007

term

inat

ion

char

ge (€

cent

)

Incumbent Mobile Operators Fastweb

11,2 €cent

3,3 €cent

PG. 22

What kind of regulatory approach

g …this is the moment for a “far-sighted” approach to regulation to foster innovation and growth in competitive New Generation broadband Networks…

PG. 23

Disclaimer

This presentation contains forward-looking information that is subject to risks and uncertainties associated with FASTWEB and the telecommunications sector.

This information reflects FASTWEB management expectations, based on currently available information. The forward-looking statements reflect certain assumed market parameters and other fundamentals and may differ materially from actual future results.