2005 Telecom Summit

1. 2005 Telecom Summit

2. Darren Entwistle a member of the TELUS team

3. transformation principles • Key performance indicators • Focus on essentials • Compliance and enforcement • Level playing field • Adapt to disruptive change

4. principle #1: key performance indicators raising the bar on performance • Set clear, consistent strategy • Know where you want to go • Have courage to set targets publicly • Accountability to stakeholders

5. principle #1: key performance indicators raising the bar on performance - TELUS • Over the last 5 years TELUS set 28 targets • 24 of 28 targets met • Rigorous focus on metrics • Instill stakeholder confidence

6. principle #1: key performance indicators raising the bar on performance - CRTC • Implementation of performance standards • 10 business days to respond to tariff applications • Major proceedings decision dates set out upfront

7. principle #1: key performance indicators raising the bar on performance - CRTC  • Reduced number and frequency of reports • 30% reduction in regulatory burden • Decision backlog largely cleared • Deferral account requires attention   X

8. principle #1: key performance indicators bridging the digital divide in B.C. • Worthy use of deferral account • TELUS – B.C. Government partnership • TELUS investing $400 million • All 366 communities in B.C.connected by 2006

9. principle #2: focus on essentials execute forward-looking strategy • Resist planning through the rear view mirror • TELUS strategy set in 2000 - future-oriented • Relentless focus on strategic imperatives • Many others in 2000 focused on the present • TELUS outperformed our peers by 124%

10. principle #2: focus on essentials strategic focus on data and wireless 2000 LD 23% Wireless 18% Voice Data 10% 49% $5.7B

11. principle #2: focus on essentials strategic focus on data and wireless 2000 2005 Wireless LD LD 38% 23% 12% Wireless 18% Voice Data Voice Data 10% 31% 49% 19% $5.7B $7.8B Significant exposure to data and wireless @ 57%

12. principle #2: focus on essentials the marketplace has changed dramatically • ILECs compete head-to-head • Cable has entered residential market • Rogers to acquire Call-Net Realistic assessment of market essential

13. principle #2: focus on essentials cable companies are large and established • Multi-billion dollar conglomerates with scale • Diversified product mix • Sophisticated sales and marketing - known brands • Established service delivery model Regulatory head start not required

14. principle #2: focus on essentials disruptive changes since price cap decision • VoIP well-established • Wireless substitution Marketplace is fundamentally different

15. principle #3: compliance and enforcement light-handed regulation works • Market forces are regulator of choice • CRTC process on local forbearance is welcome • Set ground rules - leave the field - strong referee • Wireless de-regulatory model has worked Reliance on market forces

16. principle #3: compliance and enforcement setting rules and enforcing rules • VoIP decision shows lack of trust in industry players • Focus on compliance and enforcement • Set ground rules for all players • Back up the rules with strong enforcement Giving CRTC the confidence to let go

17. principle #4: level playing field support facilities-based competition • Set policy and stay the course • No fundamental mid-stream changes to policy • Competitor digital network and price floor decisions are encouraging Consistency is what matters

18. principle #4: level playing field undermining facilities-based competition • Vonage, Primus compete unregulated in Canada • Canadian telephone companies are price regulated • Favours those who do not invest in infrastructure • Disadvantages facilities-based telephone competitors VoIP decision favours foreign competitors

19. principle #5: adapt to disruptive change CRTC VoIP decision flawed • Decision did not create level playing field • Decision disadvantages Canadian Telcos • Fails to adapt to disruptive technology • Restricts consumer choice Regulate for the future

20. principle #5: adapt to disruptive change Internet-based VoIP is different • Local calling from anywhere • Voice mail via lap top • Broadband access without investing in facilities • Low cost entry for VoIP providers • Shaw invests less than $100 million Not about simple telephony anymore

21. principle #5: adapt to disruptive change Telcos to appeal CRTC decision • Price regulation not required to protect user interests • Canada is unique in regulating retail rates • Regulatory head start for competitors unacceptable Regulatory paradigm shift is needed

22. thank you

23. 2005 Telecom Summit

24. Building high speed data Building national platforms Building a lower cost structure Cash generation phase $3.4B cash 2000-02 2003-05E $1.1B cash Investment phase investing for growth is paying off for shareholders

25. $120 relative equity price performance TELUS $111 $100 $80 $60 $45 MSCI World Telecom Index $40 $20 Assumes $100 invested from May 30, 2000 to May 30, 2005 $0 30-May-00 30-Nov-00 30-May-01 30-Nov-01 30-May-02 30-Nov-02 30-May-03 30-Nov-03 30-May-04 30-Nov-04 30-May-05 5

26. principle #5: adapt to disruptive change Internet-based VoIP is different • Consumers buy VoIP differently • Two separate purchasing decisions: • VoIP application selected from multiple competitors • Internet access selected from competing suppliers Consumers buy VoIP differently

27. principle #2: focus on essentials Shaw + Rogers = Established Competitors 3.3M Homes passed Basic service customers 2.8M 2.2M 2.1M Shaw Rogers Shaw Rogers Cable TV has high market penetration

28. principle #2: focus on essentials Shaw + Rogers = Established Competitors Digital cable customers High-speed Internet 1.1M 988,000 870,000 712,000 Shaw Rogers Shaw Rogers Leaders in high-speed penetration

29. principle #3: compliance and enforcement wireless success story • 15+ million customers, 47% market penetration • $1 billion invested annually in infrastructure • Innovation – push to talk, mobile data access • Emergency 911 services roll out

30. principle #4: level playing field TELUS capital investments • 2000 – 2004 : $8.3 billion of cash invested • High-speed data infrastructure in the west • National wireline and wireless platforms • Building a lower-cost structure for the future • 2004 capital investment • $1 billion wireline, $750 million high-speed internet • $355 million wireless Making the investment in infrastructure

31. principle #2: focus on essentials our competitors have changed • MTS-Allstream merger • Eastlink transforms into triple-play provider • Videotron and Shaw now offer telephone service Evolving competitive landscape

32. principle #3: compliance and enforcement wireless success story • Reciprocal roaming arrangements • Inter-carrier support for text messaging • Multimedia messaging and high speed wi-fi imminent • Number portability on the way Market forces feed innovation