Broadband & Multiple Play Services in Poland (TP perspective)

1. Broadband & Multiple Play Services in Poland (TP perspective) Jarosław Paszkiewicz TP dariusz.rozanski@szczesliwice.net

2. Agenda: • Brief on TP • History & current status of broadband and Internet access in Poland • TP broadband services Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

3. About TP Group • Major companies of TP Group: • TP – fixed operator (telephony, broadband services (3P), data transmission, enterprise services) • Orange – mobile operator (NMT, GSM, 3G) • Dominant player on the Polish telecom market, serving more then 10 mln fixed lines and 13 mln mobile customers, with annual revenues exceeding 18 bln PLN and GOM exceeding 8 bln PLN. Employer for 32 ths people • Our main competitive advantage is our highly developed infrastructure, which guarantees best quality and wide availability of services • We are still evolving our operations and our network to improve its efficiency to compete effectively in increasingly liberalised market. • 2nd largest company in Poland Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

4. Agenda: • Brief on TP • History & current status of broadband and Internet access in Poland • TP broadband services Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

5. History of Mass Market Internet Access in Poland • 1990 COCOM restrictions waived for Central/Eastern Europe • 1991 first connections to Internet : 2000 users (scientific communities); 9600 kbps link • 1996 TP opens public anonymous dialup access number 0202122 • 2000 TP launched first permanent Internet access offer for mass market (SDI = Permanent Internet Access) based on IDSL • 2001 Begginings of mass market Internet access competition : Wizja TV & Polsat offers Internet via satellite • 2001 Start of Neostrada TP – first ADSL broadband offer in Poland • 2003 First ADSL competitor : Dialog Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

6. Your LOGO Broadband access in Poland 2001-2006 dynamics of growth Telco & ISPs Jan 2007 market shares (total market = ca 3 600 000 users) Cable TV Sources : UKE, TP Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

7. Your LOGO Internet access technologies split Split of technologies used by companies officially reporting to UKE Sources : UKE Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

8. Your LOGO Access to telecom services in Poland 2006 : 10% of households with no fixed nor mobile telephony (and no Internet …) Sources : Eurobarometer E-communication Jun 2006 Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

9. BB penetration 2006 70% 66% 60% 57% 56% 54% 50% 45% 45% 44% 44% 43% 39% 38% 40% 36% 35% % of BB households 32% 32% 30% 24% 24% 22% 21% 20% 16% 9% 10% 6% 5% 1% 0% Italy Spain France Ireland Poland Russia Austria Norway Finland Greece Ukraine Belgium Sweden Portugal Hungary Slovakia Germany Denmark Switzerland Czech Rep. Netherlands Great Britain Baltic States Western Europe Broadband penetration in Poland vs Europe Though significant progress over last few years – there is still gap to be bridged compared to the leaders. 23% TP data OVUM forecast Sources : Ovum September 2006; TP Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

10. Your LOGO Reasons for NOT using broadband we don’t have PC we don’t need to use internet monthly costs of interent are too high installation costs are too high I don’t know what internet is we use internet at other places we don’t have a phone line we don’t have a modem our PC is not modern enough there is no offer in our place of living dangerous content of internet other d.k. Research done on ca 10k HH without internet access at home Source : GfK research 2005 Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

11. Your LOGO BB coverage of TP telephony subscribers • Since 2000 till now TP : • Invested substantial capex on ADSL infrastructure • Made significant increase of availability of broadband – at present almost 98% of TP subscribers is located within ADSL reach TP efforts to boost broadband penetration 90-95% > 95% Poland in total: - 31.12.2005 – 93% - 31.12.2006 – 97% Sources : TP Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

12. Agenda: • Brief on TP • History & current status of broadband and Internet access in Poland • TP broadband services Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

13. Your LOGO Broadband services & technology enablers • HDTV • Very high speed Internet –up to 100Mbps (up and down) • Giga mail • More upstream data • Web 2.0 expansion Service development • Digital TV • Channels & Choices (personalisation) • VOD, PVR • VoIP • One phone • UMA mobile Broadband Media • Music • -Gaming • Home Networking Applications / benefits Enhanced Web Access • Music • -Photos • Short Video Web Access • e-mail • Search • Commerce 2007 2008 1998 2002 2004 2005 2006 56 k 115 k/128 k 2 M 6 M 15 M >15 M bandwidth 100 M FTTx Dial-up SDI ADSL ADSL 2+ Technology development Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

14. Your LOGO Multiple services enabled home • Fast and easy modification of customer service choice 1P : Internet access 2P : Internet access + VoIP 3P : Internet access + VoIP + IPTV & VoD (STB additon) 3P+ : HDTV & multiple TV sets at home 4P : bundling with mobile 4P+ : full integration with mobile services (FMC) • Value added services for every profile : • Music download • Softphone VoIP & Instant Messenger (Neofon SPIK) • E-games Home Interactive Household Household Gaming security security gaming @ Videophone Voice over IP Voice over IP Internet IPTV & VoD Internet ( Wi - Fi / Ethernet ) @ Videophone TV Music Onephone (UMA mobile) Home Hom Security gateway Home Home gateway gateway Livebox Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

15. Your LOGO • Customer education • sponsoring of Internet classrooms at school • Making things affordable • lowering entry bareer for „no-PC” households (cooperation with credit entities to offer affordable loans for PC while subscribing Neostrada) • lowering entry bareer for low income users – pay as you use model (Neostrada per hour) • Making broadband available • continuous expansion of ADSL reach • new innovative wireless technologies for low subscriber density areas (WiMAX, CDMA 450) • partnering with local authorities to make Public Private Partnership true • Making things more exciting • Triple play by TP is not just bundle of telephone with Internet and Cable TV (personalised & unique content, Video Rental, PVR) TP activities to boost broadband and cancel digital divide Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

16. Your LOGO Customer behaviors change • Past / Now • Low price oriented customers => many services & service providers optimised on cost factor only • Do not care on numbers of service companies (number of invoices, points of contacts etc) • Focus on technologies behind • Telco services mainly as a mean for time saving, learning and professional use • Now / Future • Comfort, performance and quality oriented customers => integrated services, easy manouvers with service set • „Only one operator” preference - responsible for delivery of all services, one invoice and one contact point • Focus on service and content, not technology. • Telco services more and more for entertainment Subject: Broadband & Multiple Play Services in Poland dariusz.rozanski@szczesliwice.net

17. Personal details: Name: Surname: Company: Phone: E-mail: Jarosław Paszkiewicz TP +48 22 853 07 40 jaroslaw.paszkiewicz@telekomunikacja.pl dariusz.rozanski@szczesliwice.net