11

Faster is better

Tero KivisaariPresident, TeliaSonera Eurasia

Presented at Digital Communications Event 2010

September 21st, 2010

Almaty

2

Changing competitive dynamics

Applications

WebBrowser & search engine

Content distribution

Hardware

Access Telcos

3

3G– UMTS

0.384 - 21.1 Mbit/s

Ten thousand times faster in 10 years

2G– GSM/GPRS

9.6 kbps – 250 kbps

4G– LTE

100Mbit/s

2009

1999

4

Pioneering mobile telecommunications

2009

World’s first

mobile network

1956

5

Mobile broadband is exploding – case Sweden

0

200

400

600

800

1 000

1 200

FY

06

FY

07

Q1

08

Q2

08

Q3

08

Q4

08

Q1

09

Q2

09

Q3

09

Q4

09

Q1

10

Mobile Broadband subscriptionsThousands

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

Q1 06 Q1 07 Q1 08 Q1 09 Q1 10

Mobile data growthMegabytes (‘000)

6

Traffic will double every year

200,000

25,000

2007

Tbyte

2008 2009 2010 2011 2012 2013 2014

100,000

7

Eurasia - mobile broadband potential

0

2 000

4 000

6 000

8 000

10 000

12 000

08

Jan

08

Apr

08

Jul

08

Oct

09

Jan

09

Apr

09

Jul

09

Oct

10

Jan

10

Apr

Data grow th, volume index (January 2008 = 100)

Moldcell – data growth

3G services launchedOctober 1, 2008

0 % 20 % 40 % 60 % 80 % 100 %

Nepal

Uzbekistan

Tajikistan

Moldova

Kazakhstan

Georgia

Azerbaijan

Data Other VAS Voice/Other

Revenue split Country 3G license

√

√

√

√

√

n/a

n/a

• In Q2 2010, UCell was awarded a 4G license in Uzbekistan

8

Drivers for mobile broadband

• Cost control

• Perceived value for money

• Changed consumption behaviour

– Personal content

– Always on

• Laptops taking over as preferred PC

• Smartphones

9

Any screen – device independent

10

1996 2000 2003 2006 2010 2012 2015

Bandwidth1

Mbit/s

Time

Basic Internet browsing

Peer-to-peer music sharing

• IPTV

• Video streaming

• Video on demand

• HD TV

• 3D in multiplayer gaming

• Multiple streaming HD/3D TV

• Mass-market cloud computing

• Full-scale 3D emulation

• Full 3D virtual collaboration (real-time & voice & 3D holography)

• Other services yet to be invented!

Demand for bandwidth is unlimited- services available at different bandwidth speeds

3G

2G

4GVDSL2

ISDN

DSL

ADSL

ADSL2+,

VDSL

0.128

1-2

6-16

25-50

50-100

100-250

>250

1) Downlink bandwidth supported by respective technologies, respective uplink speeds are considered accordingly

Source: McKinsey

Always the same question:

“Will we need that much bandwidth?”

█ Existing infrastructure

█ FTTH required

• True HD

• Remote hosting

• 3D TV and full interaction solutions

11

Technology evolution - requires high capacity transmission solutions

Radio

Today up to

100Mbit/s

Fiber

Core

Internet

12

New pricing logic in mobile broadband- from flat rate to volume based

Price related to usage

Volume

Speed

2G

3G

4G

1-10 MB/s

10-100 MB/s

0,1-1 MB/s

2 GB

10 GB

20 GB

30 GB

13

Next step - value based pricing

+Monthly fee

Volume cap

Defined speed

14

Utilizing all possibilities in frequencies and technology

Keeping costs under control

• Rapid technology development with price pressure

• Network planning

• New technology more efficient

• Spectrum more efficiently used with technology neutrality

• Network sharing

15

Conclusion

• Competitive landscape changing

• People want access and services

– Device independent

– Anywhere and anytime

– Multi-tasking without losing speed

– Significantly shorter response times

– Technology not important

• Unlimited demand for bandwidth

– Technology evolution – speed increases constantly

– Frequency re-use/re-farming and technology neutrality

• Develop business models

• Fixed network needed for multiple users at fixed locations

and high capacity mobile access

1616

www.teliasonera.com