Welcome to sunrise

1. Welcome to sunrise

2. Discussing the implementation and deployment of sunrise‘s prepaid roaming services Thomas Lüscher29.09.2004

3. Agenda • Introduction sunrise & Swiss market • Roadmap roaming services • Pricing & impact of single services • Terminated roaming • USSD callback • SMS roaming • CAMEL roaming • GPRS / MMS roaming • Summary

4. sunrise • sunrise is created from sunrise and diAx in 2001 • 100% owned by the TDC Group („TDC Switzerland AG“) • First independent full service provider (mobile, fixed line, Internet) in Switzerland • Number 2 in Swiss market • Customer base of 2.611 million • Mobile: 1’323’000 • Fixed network: 808‘000 • Internet (dial-up): 359‘000 • ADSL: 121‘000 • Member of the “starmap mobile alliance”

5. Swiss market • Penetration of 80%+ • Prepaid market share ~42% sunrise above average • Best value for money offering -> „most attractive prepaid product“ • Comprehensive services also for prepaid incl. roaming early on • Geographical situation • Relatively small country • Bordering to Germany, Austria, France and Italy • Swiss travel abroad often for vacation, but also for short-trips (i.e. shopping) • Roaming is an important factor

6. 2000 2004 2001 2002 2003 sunrise pronto roaming services Receiving calls/SMS when roaming CAMEL roaming (phase 1)sunrise pronto direct roaming USSD-callback Outgoing SMS when roaming GPRS roaming MMS roaming June June May June March September

7. The start of sunrise pronto roaming • Goal: offer prepaid roaming for summer season 2000 • Not quite made it: • Only mobile terminated calls (CDR based) • USSD-callback solution not ready/stable in time • USSD-callback roaming launched in September 2000 as the second operator in Switzerland • Not the start we had hoped for; roaming revenues made up only ~2.5% of total prepaid revenues in July 2000

8. SMS roaming – immediate huge success • Idea to implementation only a few weeks • Use interworking CDRs • Flat rate: CHF 0.80 / SMS (~ 0.50 Euro) • First operator in Switzerland to introduce SMS roaming • Hardly any communication / advertisement • Immediately made up for almost half of sunrise pronto roaming revenue • Definitely one of the projects with the shortest payback ever!

9. Summer 2001 • First time roaming really made a difference • 9.3% of total prepaid revenue in July 2001 • Despite efforts, customers not so familiar with USSD-callback • Only 16% of total roaming revenue • Ratio terminated vs. callback ~ 4:1

10. Introduction of CAMEL • This time we made it for summer roaming season (launch in June 02) -> sunrise pronto direct roaming • One competitor basically launched at the same time • Launch with neighbouring countries (France, Germany, Austria, Italy) and Spain • USSD-callback still in parallel, but in countries, where we had at least one CAMEL-partner, sunrise pronto customers could only log on to that network • At the same time meant also introduction of realtime rating in our own network (all circuit switched calls)

11. Prepaid billing system HPLMN 3 8 12 4 9 13 SCP 2 5 7 11 14 VPLMN 1 1 6 6 VMSC MSC 10 called party Prepaid subscriber Chosen solution • CAMEL Phase 1 solution without home routing • Wider support of CAMEL Phase 1 (than 2) around Europe • Didn’t see much advantages of going to Phase 2 • However sunrise supports Phase 1 & 2 on the inbound side Allocate time slots and „renew“, if used up (3,4 / 8,9)

12. Pricing model • New pricing model for all roaming calls • 60s intervals, as well on the outgoing, as incoming calls side • Formed three tariff zones • Europe 1 / Europe 2 / rest of the world • Europe 1 in line with postpaid offeringeurozone (flat rate in all countriesincluded in eurozone) sunriseeurozone Exchange rate: 1 Euro = ~CHF 1.55

13. First results (July 2002) • Outgoing roaming started to make a difference • SMS-usage stayed very high • Increased revenue also on the terminated side • 14.3% of total revenue in July 2002 • Ratio terminatedvs. outgoing ~ 2:1 • 60% increase ofroaming spendingon per customerbasis

14. Mediation Prepaid system SGSN GGSN GRPS roaming • Introduced GPRS-roaming almost „unintentionally“: • In first phase only foreseen for postpaid • Realized, that it would almost be harder to block prepaid customers from using GPRS abroad, than to allow them to use it (on HLR level) • Quick and flexible CDR-solution implemented (supposed to be intermediate solution, but we still have it) • All sessions through sunrise APN and thus CDRs produced (SGSN-IP address used to identify location of GPRS data connection) VPLMN HPLMN CDRs WAP GW

15. GPRS / MMS pricing • With the introduction of GPRS-roaming, we basically had the solution for MMS roaming in place, once MMS was launched • GPRS/MMS roaming only with a limited number of roaming partners in the beginning • Flat rate for GPRS/MMS roaming Exchange rate: 1 Euro = ~CHF 1.55

16. Summer 2003 • More CAMEL roaming partners – most of Western Europe covered • Again increase in roaming revenue – mainly due to increase in outgoing calls / SMS • GPRS / MMS roaming still very low usage • Ratio terminatedvs. outgoing ~ 1.7:1 • 90% increase ofroaming spendingon per customerbasis since 2001

17. Situation today (2004) • Roaming is a key part of the sunrise pronto offering • Also prepaid is integrated part of roaming campaigns • Large footprint of direct roaming • More than 40 countries and over 60 operators • Including almost all Europe, but also i.e. Thailand, some Carribean islands, Egypt or Tunisia ... • i.e. 2004: MMS contest • send your best holiday picture (published on Internet) and win travel vouchers worth several thousand Euro

18. July 2004 • Further increase of roaming usage, mainly due to more outgoing calls • USSD-callback usage minimal • GPRS/MMS usage „noticeable“ for the first time • Total roaming revenuemore than 15% of total prepaid revenue • Split terminatedvs. outgoing ~ 1.5:1

19. Development over the years • CAMEL roaming made a huge difference, not only in the summer months, but during the whole year (roaming still very seasonal) • Roaming offers helped to place sunrise pronto as the most attractive prepaid offer in Switzerland (complete offering)

20. Key learnings • Roaming can make a difference and significantly increase prepaid revenue • Keep it as simple as possible for your customers • SMS roaming immediate success (use as in home network) • USSD-callback maybe already too complex • direct roaming (CAMEL) well accepted; only enabling roaming with supporting operators per country helped • SMS and direct roaming are key to success • GPRS/MMS might be in the future, but not yet • Issue: roaming rather expensive -> customers run out of money

21. Outlook • Improve / find new ways of offering refill possibilities also when abroad – sunrise offers credit card refill, but not very popular • More solid / flexible charging solution for packet switched data when roaming – further growth is expected (UMTS roaming?!) • Review pricing on the GPRS / MMS side – rather expensive and not so attractive for customers at the moment • Further improve communication of roaming services to customers (welcome SMS, SMS bon voyage, ...) • sunrise will stay committed to offer also its prepaid customers complete and easy to use roaming services

22. Thank you