CDMA2000 Delivers 3G

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CDMA2000 delivers 3G

CDMA Development Group

Ljubljana, Slovenia December 1, 2003

CDMA Development Group

CDMA Worldwide

CDMA2000: Delivering on 3G

1 CDMA Development Group

CDMA Worldwide

CDMA2000: Delivering on 3G

Charter

To lead the rapid evolution and deployment of CDMA-based systems, based on open standards and encompassing all core architectures, to meet the needs of markets around the world

Information Technical Service Deployment Distribution Development Assistance Conferences System Testing Time-to-Market Emails Advanced Systems Int’l Roaming Website Evolution Interoperability Etc. Etc. Etc.

2 Membership

The CDG is a consortium of 100 member companies from around the world. Members are involved in many aspects of CDMA system deployment and support.

Subscriber Value-Added Operators Equipment Services

Network Network Network Infrastructure Enhancement/ Interface & Optimization Access

CDMA Development Group

CDMA Worldwide

CDMA2000: Delivering on 3G

3 CDMA is the present and future of advanced wireless services

Code Division Multiple Access (CDMA) is a spread spectrum technology used in second and third generation wireless networks

® cdmaOne™ identifies 2G and 2.5G cellular, CDMA2000 is an ITU-approved, IMT-2000 (3G) standard PCS and wireless local loop (WLL) services CDMA2000 1X can double voice capacity and delivers data based on the IS-95A and IS-95B CDMA air rates up to 307 kbps interface standards. IS-95A supports data delivery up to 14.4 kbps while IS-95B offers up CDMA2000 1xEV is optimized for high-speed data: to 115 kbps. • CDMA2000 1xEV-DO uses a designated channel for data at speeds of up to 2.4 Mbps in a single carrier • CDMA2000 1xEV-DV integrates voice and data on a single channel with speeds of up to 4.8 Mbps 7

CDMA benefits

As the most advanced digital technology, CDMA offers significant benefits to operators and their subscribers

Operators Subscribers

• Greater voice capacity • Improved voice quality • Simplified system planning • Longer talk time through the use of the same • Enhanced privacy and security frequency in every sector • Advanced data services • Improved coverage characteristics resulting in fewer cell sites • Data ready; uses standard IP commands and protocols • The platform for 3G

4 The dominant 3G standards are based on CDMA

IMT-2000 Terrestrial Radio Interfaces

IMT-2000 IMT-2000 IMT-2000 IMT-2000 IMT-2000 CDMA CDMA CDMA TDMA FDMA/ Direct Spread Multi-Carrier TDD Single Carrier TDMA WCDMA CDMA2000 1X UTRA TDD & UWC-136/ DECT (UMTS) & 1xEV TD-SCDMA EDGE 3G CDMA

CDMA is the fastest growing technology worldwide

• Serves more than 174 million users across all continents 160,000 • Subscriber base growing at 29% per 140,000 year* 120,000 • Rapidly expanding in key markets 100,000 80,000 – Latin America and Caribbean – 31 million users

Thousands 60,000 40,000 – India – fastest growing technology, 20,000 reached 5.5 million subscribers and 0 growing at nearly 700,000 per month 1997 1998 1999 2000 2001 2002 – China – 15 million users in 21 months Asia Pacific North America Latin America Europe, Middle East, Africa • Dominant technology in North America – CDMA: 71 million subscribers, 48% market share**

Source: CDMA Development Group *Source: EMC Database for 2002 **Source: EMC Database for June 2003 10

5 CDMA will double its market share

Worldwide Subscribers

158 networks in 59 countries Millions across all continents by the end of 2,500 2003 2,000

Servicing 490 million subscribers 1,500 by 2008* 1,000

Global market share will nearly 500 double to reach 26% in 2008 and 0 28% by 2011* 2000 2002E 2004E 2006E 2008E 2010E

GSM/GPRS/EDGE WCDMA CDMA TDMA PDC AMPS/NMT/TACS/ETACS

11 *Source: Deutsche Bank, May 2003

CDMA Development Group

CDMA Worldwide

CDMA2000: Delivering on 3G

6 CDMA2000 is the leading platform for advanced wireless services today

CDMA2000 leads in deployment of 3G today • 71 commercial networks across six continents • 17 networks scheduled to be deployed this year • 64.5 million subscribers – 37% of CDMA users have access to 3G – Growing at 4 million new users per month – KDDI added 10 million subscribers in 18 months CDMA2000 leads in number of data 1X Commercial 1xEV- DO Commercial 1X Deployment 1xEV- DO Deployment subscribers 1X Trial 1xEV- DO Trial • 54% of data subscribers worldwide use CDMA2000* Source: CDMA Development Group • 14% of CDMA subscribers use CDMA2000 data services

*Source: EMC Data Base, June 2003 13

CDMA2000 will continue to expand

3G Subscriber Base CDMA2000 and WCDMAwill Millions dominate the 3G market 700 600 • CDMA2000 subscriber base will reach 500 360 million by 2009 400 • Nearly 70% of CDMA subscribers will 300 use CDMA2000 200 • CDMA2000 will have 18% of 100 worldwide market share 0 2000 2002E 2004E 2006E 2008E

WCDMA CDMA2000

Source: Deutsche Bank, April 2003

7 CDMA2000 key success factors

EnablesEnables rapidrapid timetime--toto--marketmarket

• Commercial since October 2000 and widely deployed worldwide • Can be deployed rapidly • Does not require new spectrum

OffersOffers thethe mostmost economicaleconomical andand flexibleflexible managementmanagement ofof spectrumspectrum

• Requires only 1.25 MHz of spectrum and can be deployed in any frequency designated for wireless services • Increases network capacity for voice and data traffic OffersOffers costcost--effectiveeffective migrationmigration fromfrom existingexisting systemssystems

• Viable solution for any existing technology • Minimizes capex and opex by leveraging investments in core networks and operating systems

DeliversDelivers highhigh datadata ratesrates andand supportssupports advancedadvanced applicationsapplications

OffersOffers thethe broadestbroadest rangerange ofof devicesdevices atat affordableaffordable pricesprices

CDMA2000 affords flexible management of spectrum

Current Spectrum Or New Spectrum

AnalogAnalog 1x 1x 1x 1x ANSI-41 Based Systems cdmaOnecdmaOne 1x 1x 1x 1x

TDMATDMA 1x 1x 1x 1x

GSM-MAP Based Systems GSMGSM/GPRS or GSM/GPRS 1x 1x 1x 1x

1.25 MHz 5 MHz

Because CDMA2000 requires only 1.25 MHz of spectrum, it allows an operator to introduce 3G data services gradually while preserving most of the spectrum to service voice customers

8 CDMA2000 can be deployed in any existing and new spectrum allocated for wireless services CDMA2000 (1.25 MHz)

YES YES YES* YES YES YES

Cellular NMT PCS/PCN CDMA GSM GSM CDMA Analog TDMA PDC TDMA Analog GSM UMTS Europe and Asia MHz 450 800 900 1700 1800 1900 2000 2100 2200

NO NO NO ? ? YES WCDMA (5 MHz) 17 *Limited by Regulations

CDMA2000 offers increased capacity to support growth. . .

9 . . . and high throughput to support advanced applications

CDMA2000 offers a direct path to 3G for any existing technology

ANSI-41

1xEV-DO 1xEV-DO (with enhancements) cdmaOne CDMA2000 1X • 2.4* Mbps Packet • 3.1* Mbps Packet • RF backward comp. • RF backward comp. • 14.4* kbps Circuit • 153* kbps Packet • RF backward comp. 1xEV-DV TDMA

• 9.6* kbps Circuit • 3.09* Mbps Packet • RF backward comp.

EDGE MAP

GSM GPRS • 118* kbps Packet • 9.6* kbps Circuit • 53* kbps Packet WCDMA HSDPA

• 384 kbps – 2* Mbps Packet • 10* Mbps Packet • New RF Spectrum • RF backward comp

2G technologies 2000 2001 2002 2003 2004 2005 3G technologies 20 * Represents peak data rates

10 CDMA2000 is a natural evolution path for cdmaOne operators…

New 1X Channel Card BTS New Software CDMA2000 ADVANTAGE New Terminals • Preserves existing AMPS (backward and ANSI-41 network compatible) Software Upgrade BSC • Handsets backwards compatible with cdmaOne PDSN system Software Upgrade

MSC IWF

IP Backbone PSTN WWW VPN Enterprise Network

…and requires relatively small capital investment

Total CapEx (US$ billion)

Japan KDDI (CDMA2000 1X and 1xEV-DO) 2.5

DoCoMo (WCDMA) 10.9

U.S. Sprint PCS (CDMA2000 1X) 0.8

AT&T Wireless (GSM/GPRS/EDGE) 5.0

Moody estimates that cdmaOne carriers could upgrade to CDMA2000 1X for $3 to $5 per POP

Source: Morgan Stanley, June 2002; Yankee Group, July 2003; Moody; operator reports 22

11 TDMA/AMPS to CDMA2000: One step evolution to 3G

New off-the-shelf AMPSAMPS to CDMA2000Network 1X CDMA2000/AMPS Terminals BTS CDMA2000 BTS* New Equipment with 1X Channel Card

CDMA2000 ADVANTAGE BSC New Equipment • Preserves existing AMPS and ANSI-41 network • No new spectrum required PDSN Software MSC • Handsets backwards Update compatible with cdmaOne system Modem Pool

IP * Usually co-located with AMPS equipment, requires separate interface protocols PSTN Backbone

WWW VPN Enterprise Network 23

There are more than 430 CDMA2000 terminals from 46 manufacturers

With Color Displays and Cameras Support Streaming Video Real-Time VOV/AOD Offer Voice Recognition GPS

12 Economies of scale are driving prices down

WHOLESALE PRICES OF CDMA 1X AND GSM HANDSETS

$300 CDMA2000 1X 2004-2007: the convergence of $285 prices for CDMA2000 1X and $250 GSM handsets, driven by technology maturation and

$200 $210 economies of manufacturing scale GSM $150 $132 $99 Handset Prices $100 $77 $108 $60 $94 $51 $44 $50 $84 $60 $50 $45 $40 $35 $0 2000 2001 2002 2003f 2004f 2005f 2006f 2007f

Source: The Shosteck Group. Average low-price handsets produced by “first tier” vendors for their largest customers. Prices as of year-end. 25

CDMA2000 delivers a broad range of applications to the end user. . .

News Position Location

Push To Talk Entertainment

MMS Email

It’s a Boy!

Multiplayer Video Gaming Monitoring 26

13 …and incremental revenue to operators

For CDMA2000 operators, data ARPU CDMA2000 subscribers generate 5 increases by 62% to contribute 11.6% times more data ARPU and 57% more in of total ARPU total ARPU than 2G subscribers

4,000 14.0% 11.6%

3,500 12.0% 50,000 9.9% 3,000 9.0% 40,000 10.0% 7.9% 2,500 7.4% 30,000 8.0% 2,000 20,000 6.0% 1,500 10,000

4.0% 0 1,000 FIMM 2G 1X B&W 1X Color FIMM EV-DO 2.0% 500 Data 1,058 2,106 4,734 8,877 10,197 Voice 22,299 28,675 32,453 32,347 35,034 0 0.0% 4Q 2001 1Q 2202 2Q 2003 3Q 2003 4Q 2003

Data ARPU Data ARPU/Total ARPU Others 12% CDMA2000 allows operators to offer richer content (beyond SMS) that SMS Wireless drives data usage 30% Content 58%

Source: KTF, December 2002 27

CDMA2000 Case Studies

14 3G Network 2,500 35.00%

– Launched CDMA2000 1X in April 2002 30.00% – Covers 99.9% of the population 2,000 25.00% – Deployed CDMA2000 1xEV-DO in Data as Percent of Revenue November 2003 1,500 20.00% 3G Subscribers 15.00% – Surpassed 10 million in September 2003, 1,000 18 months after the launch 10.00%

• Over 64% of their subscriber base 500 uses 3G Monthly Data ARPU (Yen) 5.00% • Controls 90% of the 3G market in Japan 0 0.00% Mar-02 Jun-02 Sep-02 Dec-02 Mar-03 Jun-03 Revenue Data ARPU Data as % of Revenue – Data ARPU increased to 30% of revenues exceeding analysts’ expectations

CDMA2000 1X EZweb services include location based services, MMS, video distribution and high-speed web access ” mail -

• Video Clip based e • Location-based • JavaTM application Distribution - services (LBS) services • Support of Mobile • Use of Industry • Powered bygpsOne Standards, i.e., agent function IMAP4 MPEG-4 and MP3in – using HTTP Multimedia Messaging MP4 file “ • Automatic application update • Take 15 second from servers movies and send in e-mail EZweb@mail platform for EZweb – WAP2.0-based Internet Access and Browsing Platform

15 SK Telecom

• CDMA2000 subscribers: 13.5 million or 75% of base • Data services surged 91% in 2Q 2003 compared to the same period last year • CDMA2000 1xEV -DO subscribers constitute 6% of the subscriber base, but they already account for 12% of the operator’s total revenue

Data Usage Data ARPU by handset

(WI ARPU in Won) 5,063 25,000 (Data ARPU in Won) 35.00% 4,893

15% 30.00% 20,000 3,847 25.00% 3,290 13% 15,000 20.00% 2,736 12%

15.00% 10,000 10% 10.00% 9% 5,000 8% 5.00%

0 0.00% IS-95 CDMA2000 1X CDMA2000 1xEV-DO June (CDMA2000 1xEV- 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2003 (E) DO)

% of Total Revenues* WI ARPU Data ARPU Data as % of Revenue

* % of Total Revenues excluding 31 interconnection revenues

Wireless Internet Trends

SK Telecom

“June” 1xEV-DO High Quality Video using MPEG4

Mobile Movie Music Video Hot Key

?? ? 98Km

?? ? 96Km

Video Mail Real Time News Traffic Information 32

16 Subscribers: 19.3 million Data: 5.1 million Vision PCS (3G Data): 2.7 million CDMA2000 Services: • Picture Mail, Messaging – Picture Messaging: 23 million in 3Q 2003 • Games • Ringtones • Web Access Data ARPU: • Average Subscriber: $2 • Vision PCS: $10

Subscribers: 36 million (14% annual growth) in 3Q 2003 Info, Productivity • Data: 10 million (nearly 30% of base) 12% CDMA2000 services: Picture Messaging, BREW -based entertainment, ring-tones, 50% 38% Broadband Access based on CDMA2000 1xEV-DO • Text Messaging: 400 million per month, 1 billion per quarter • BREW Applications: 4 million per month • Picture Messaging: 2 million per month CDMA2000 1X data usage up 77%