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Türk Telekom Continues to Invest in the Digital Future of Turkey, While Keeping Pace with Technology. We Lay the Foundations Of

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Türk Telekom Continues to Invest in the Digital Future of Turkey, While Keeping Pace with Technology. We Lay the Foundations Of Türk Telekom continues to invest in the digital future of Turkey, while keeping pace with technology. We lay the foundations of this future by maintaining our investments in line with our current convergence strategy. In the last five years, our total investment reached TL 9 bn. We invest in infrastructure, technology, and more importantly in the human capital of Turkey. MESSAGE FROM THE CHAIRMAN OF BOARD 002 Türk Telekom 2010 Annual Report Turkey continues to be a leading star among emerging markets As Türk Telekom group, we place great emphasis on supporting with its young dynamic population and growing economy which education in Turkey. I am especially proud of our online education displayed a remarkable performance over the last couple of years. I software services developed by our group company Sebit. Vitamin, am happy and proud to see that Türk Telekom is playing an integral an online education support service for students and teachers role to enhance and grow the Turkish economy and the quality of became a global brand with English, Spanish and Arabic versions life for her people. available in other countries and reached to millions of students. I am happy to see that thousand of students are attending schools Türk Telekom and group companies continue to drive built by Türk Telekom and about 1,000 Internet Houses donated by telecommunication industry in Turkey with strong operating Türk Telekom are visited by 200,000 people each day. performance and leading technology and convergence initiatives. Our group had an outstanding performance in 2010 delivering We also continue to improve our corporate governance practices almost TL 11 billion in revenues and TL 2.45 billion in net income. in accordance with international standards. Türk Telekom became We achieved growth both in our fixed line and mobile business the first and only telecommunication company in ISE Corporate segments. Building on synergies between Türk Telekom group Governance Index soon after IPO and improved its Corporate companies we continued offering total telecommunication Governance Rating in 2010. solutions and value added services to our customers. MESSAGE FROM THE CHAIRMAN OF BOARD I would like to express my sincere gratitude and warmest thank- In 2010, we took an essential step for a more dynamic and efficient you to all members of the Turk Telekom family for making their management of Türk Telekom Group and appointed Mr. Hakam individual contributions to the success achieved by the Türk Kanafani as Türk Telekom Group CEO and Mr. K. Gökhan Bozkurt Telekom Group in 2010. as Türk Telekom CEO, which will ensure a strong and sustainable growth of the Group’s operations which reached ten companies. We will continue to create value for our shareholders, customers and all stakeholders with our innovative products and services. 003 While keeping pace with the technology, Türk Telekom group This is not only our future direction, but our general mindset and it continues to invest in Turkey’s digital future. As Türk Telekom, we lay is indeed, an obligation to this great nation. foundations of this future with our continuing investments in line with our current convergence strategy in the most powerful way. In the last five years, our total amount of investment reached to TL 9 billion. Our investments cover infrastructure, technology and more Türk Telekom importantly Turkey’s human capital. Türk Telekom group invested TL 1.7 billion and recruited more than six thousand new and skilled 2010 Annual Report employees last year, mostly young Turkish university graduates. As we focus on investing in technology and our employees, we enhance Mohammed Hariri the quality of services provided to our customers. Our focus is to enable customers to collaborate, communicate, and access information or media on any device, in a cost effective way in order to manage and engage in personal, social and business life anywhere. Our strategy in Türk Telekom is to ensure our leadership in communication services by creating a unique value with convergent services and to become the main communication hub in the region. Following this strategy, we acquired Pantel International (formerly Invitel International) and launched JADI Fiber Link Project in 2010. Our mobile and broadband “blocks” showed a significant growth in 2010’s heavy competition environment. Türk Telekom Group has the strength to maintain and increase this growth. We will continue to improve our services, getting our strength from our advanced distribution channels, our strong brand, our convergence products, our team spirit, and the synergy between our group companies. MESSAGE FROM THE GROUP CEO 004 Türk Telekom 2010 Annual Report Türk Telekom Group is an integrated operator that is now the leader Türk Telekom Group currently has more than 34 thousand of Turkey’s Telecommunications and Information Technology sector employees and is one of the biggest employers in Turkey. We with our “smart growth” strategy and efficient corporate structure. focus on contributing to the Turkish economy by creating career Our vision is about converged building-blocks that encompass all opportunities based on objective recruitment guidelines and fair communications services. Those building blocks cover holistically guidelines. Our Human Resource plans are now implemented in the full range of our customers’ needs, requirements, habits and most cities in Turkey. aspirations. Today, we set a successful case study of converged technologies that has set the trends of the future. Inspired by their Our people are our most valuable asset. Our people deliver own success, our people are an integral part of Turkey’s economic customer-oriented products and services with professional skills progress. and warm enthusiasm. Our people are the team that ensures our success not only on the commercial level but also on corporate Our mobile and fixed broadband “building blocks” have social responsibility projects and corporate transformation. demonstrated solid growth in the face of intensified competition. On the fixed broadband side, we continued our investments in fiber Türk Telekom Group is very well positioned to sustain the to the neighborhood (FTTN) which now covers around three million momentum and continue to build on our recent growth in 2011 and homes. In 2010, we enhanced our annual ADSL ARPU by 8% and we will continue to improve our services to the market, capitalizing MESSAGE FROM THE GROUP CEO increased the number of ADSL connections by 500,000 subscribers. on our advanced distribution channels, strong brand name, By improving our infrastructure and our service quality, we have converged products, team-work and synergies. In the name of our started offering higher quotas and speeds to ADSL customers. shareholders and board I am honored to thank all members of Türk On the mobile side, AVEA has achieved significant EBITDA growth Telekom Group family for a job well done. And I extend my warmest and noteworthy service level improvements. AVEA increased its gratitude to our customers and business partners for their support postpaid customers by almost 10% yoy while the blended ARPU and contribution to Türk Telekom Group’s ongoing success. increased by 8% thanks to innovative tariff and VAS offerings and 005 Türk Telekom Group cross selling activities. Innova’s creative mobile communications technology coupled with the company’s banking sector knowledge pioneered new and fresh approach in mobile banking with PayFlex application. Thanks to Hakam Kanafani another Innova product “Innova Paying Kiosk”s, users can pay bills, Türk Telekom load units, and perform various transactions such as tax payment and sale and purchase of exchange. 2010 Annual Report Argela added new products for the future by developing Avatar technology. Argela, developed web TV and femtocell solutions and continues to focus on developing technologies that will create value for our group customers in Turkey and outside the border as well. Sebit’s education software Vitamin, is a proven success case in Turkey and many other countries as well. Vitamin is used in different countries’ with the local curriculum (in Turkish, English and Arabic and soon Spanish). Our gaming and animation developer Sobee is an exciting venture. Sobee’s “I Can Football” project is a first in the world, and growing rapidly. AssisTT is Turkey’s leading call centre solution provider. The company invested in well trained human resources and top notch computer systems. Notably the call centre opened in Erzincan and with its other investments in the country, AssisTT also contributed to improving recruitment. In 2010, Türk Telekom focused on investments to transform Turkey into the telecommunications hub of the region. We have succeeded in globalizing the Türk Telekom brand, and strenghtening our competitive position with our convergence technologies and value added services. Turkey has started to experience more innovative internet services thanks to the opportunities provided by broadband. MESSAGE FROM THE CEO 006 Türk Telekom 2010 Annual Report We have left behind another year in which we continued our In 2010, we were once again awarded “The Most Valuable Brand in investments in infrastructure and technology. We work very hard Turkey” following the same success in the previous year in a survey in order to make life easier for our customers and to create value “Most Valuable Brands in Turkey” conducted by Brand Finance, for all of our stakeholders -especially our customers and business a UK-based leading independent brand valuation company, partners- and for our country. moreover, we were awarded with many prestigious international awards by various organizations, such as Best Fixed Line Operator, In 2010, we acquired Invitel International (rebranded as Pantel Best Content, Best Innovation and Best New Product. International) and signed a very important terrestrial fiber optic link agreement (JADI Link) with leading operators from Saudi Arabia, While achieving these, we were also in line with our objective to Jordan, and Syria making Turkey the new telecommunication add value to the society.
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