Vodafone Fixed/Convergence Open Office

19-20 September 2017 Disclaimer

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2 Fixed/Convergence: A significant growth opportunity

Nick Read Group Chief Financial Officer Key takeaways

We have created Europe's largest NGN footprint, thanks to our 1 flexible infrastructure strategy

The shift to NGN is a significant window of opportunity for Vodafone 2 to achieve substantial and profitable market share gains

Significant fixed-line scale and advanced TV/content capabilities allow 3 us to unlock convergence benefits

Fibre builds will bring incremental growth and attractive returns, 4 given our disciplined investment criteria

4 The shift to NGN creates a window of opportunity for substantial market share gains…

European fixed broadband customers (in Vodafone footprint)1 (m)

140

120

100

Legacy 80 copper 60

40 NGN 20

0 2015 2016 2017e 2018e 2019e 2020e 2021e (% of BB base on NGN) 42% 51% 59% 66% 76% 81% 71% 5 Source: Analysys Mason Vodafone has created a significant NGN footprint European homes marketable (Q1 17/18) (m) Owned European NGN network vs. peers1 (m)

51 163 Not covered Total incl’ ADSL and NGN 136 38 NGN wholesale 36 98 31 41 Strategic wholesale partnerships2 24 Owned NGN network 36 18 17

% of homes 22 25 60 83 100 Liberty DT Vodafone Orange BT TEF TI Leading NGN marketable footprint in EU, #3 on-

1. Vodafone estimates as at Q1 17/18 6 2. Includes Telefonica (selected areas in Spain), Open Fiber (Italy) and SIRO (Ireland) We are Europe’s fastest growing broadband provider European broadband net adds (FY 16/17)1 (m) NGN on-net and off-net penetration (FY 16/17) (%)

On-net Off-net

Vodafone 1.3 44%

ORA 0.8

27% 27% LBTY 0.7 22% 19% BT 0.2 12% 8% DT 0.2 4% 5% 2.5% 0% 1% 0% 1%

TEF 0.1 Europe NL DE ES PT IT UK

1. Note: JV with is included in Vodafone and , based on company reports 7 And have reached significant scale Total broadband customer base in Europe (Q1 17/18)1(m) Revenue market share (Q1 17/18) 1 (%)

Mobile Fixed

39% 37% 18.6 33% 18.1 17.5 32% 16.8 30%

22% 21%

9.3 8.1 7% 8% 7.3 4%

DT Orange LBTY Vodafone BT TEF TI DE UK IT PT NL

1. Vodafone includes VodafoneZiggo. Source: Vodafone estimates and company reports 8 Fixed scale unlocks convergence opportunities Non-converged to converged (FY 16/17) (m) Churn improvement (Q1 17/18) (%)

Consumer customers’ convergence pyramid1 Vodafone Spain, consumer contract customer churn

Households / SIMs ~40% of fully converged on Vodafone fixed households 4 8 have fixed and mobile, and Upgrade ~17% of Vodafone Household / SIMs 22% mobile SIMs 2 3 not in integrated bundles Cross-sell 9 53 Single product Fixed-only Mobile-only Vodafone customers households SIMs Acquire 9% 7% Mass Non-Vodafone 104 customers within Households Market footprint Mobile only 3P 4P (incl. TV) Broadband Mobile SIMs households

1. Mobile active consumer SIMs; excludes Eastern Europe; SIMs per household calculation based on regional averages 9 Supported by our leading TV platforms and expertise TV markets TV customers (m)

VodafoneZiggo Analogue • Competitive premium content Digital portfolio • Distributor/partnership model preferred to exclusive ownership 4.0 4.0 • TV drives ARPU growth (~20-50%)1

5.0 4.9 4.9 4.8 4.7 4.5 Giga TV

4.6 4.7 4.9 5.0 5.1 5.2 Live TV Connected screens Q4 15/16 Q1 16/17 Q2 16/17 Q3 16/17 Q4 16/17 Q1 17/18 Content in the Cloud On Demand

1. When customers move from 2P to 3P (incl. TV) 10 Markets are moving to convergence at different speeds Fixed-mobile convergence as % of total fixed broadband households (%)

Market Market Vodafone consumer (Q1 17/18)2 FY 11/121 FY 16/171

88% 84

24% 48

21%

21 22 74% 8% 27% 12 8 9 5 7 3 2 4

ES PT NL DE UK IT

1. Analysys Mason – Multi-Play in Europe 11 2. Number of consumer broadband (RGUs) linked to a converged customer account relative to total consumer broadband customers We have good momentum Europe converged consumer net adds (LTM)1 (000s) Europe consumer converged customers(Q1 17/18) (m) Fully converged customers and penetration of consumer broadband base

Europe 4.4 Spain Total Europe Italy 220 689 165 Spain 2.3 VodafoneZiggo² 0.6

Italy 0.5

Germany UK Germany 0.5 195 93 UK 0.1

Other Europe 0.4

• ~60% of European broadband net adds are converged • On average 2 SIMs per customer over the last 12 months • Significant penetration potential

1. Last 12 months (Q2 16/17 to Q1 17/18). Excludes VodafoneZiggo 2. VodafoneZiggo stated as at Q4 16/17 12 : Gigabit Investment Plan Approx €2bn investment in fibre over the next 4 years… … to drive attractive incremental growth and returns

Giga-Business Under-served market: • Targeting 100,000 companies in around • <2%1 of homes have access to Gigabit speeds 2,000 business parks in co-operation with • 25%2 of broadband connections are <50Mbps strategic partners • Fibre demand in enterprise bids doubled YoY • €1.4bn-€1.6bn investment

Giga-Municipality Opportunity to gain share: • Partnering with local municipalities to reach • Enterprise fixed revenue market share <15% around 1m rural homes • Accretive to service revenue growth by 1-2pp • €0.2bn-0.4bn investment • Attractive incremental EBITDA margins

Giga-Cable Value accretive investment: • Accelerating the upgrade of our cable • IRR >20% for Giga-business and Giga- infrastructure to deliver 1 Gbps across our municipality 12.6m marketable homes • Payback of <4 years per business park and • €0.2bn investment <6 years per municipality

A success-based investment model, with limited execution risk and fast speed to market

1. Source: OECD 2016 13 2. Vodafone projections based on BMWI Breitbrandatlas Summary Fixed as a % of European service revenue1

1. We have created Europe's largest NGN footprint, thanks FY 16/17 to our flexible infrastructure strategy 2. The shift to NGN is a significant window of opportunity 28% for Vodafone to achieve substantial and profitable market share gains

3. Significant fixed-line scale and TV/content capabilities allow us to unlock convergence benefits

4. Fibre builds will bring incremental growth and attractive FY 11/12 returns, given our disciplined investment criteria: - IRR materially above WACC 12% - Typical payback period 4-7 years - Predictable regulatory framework

1. Excludes Vodafone Netherlands in all periods 14 Vodafone Fixed/Convergence Open Office

Vodafone Italy Market overview Service revenue (FY 16/17) (€bn) Mobile revenue share (FY16/17) (%) Fixed revenue share (FY 16/17) (%) Others Others Vodafone Vodafone Others Fastweb 6 3 8 7 6 18 WindTre Vodafone Fastweb 12 32 32 WindTre 19 FY 16/17 WindTre 7

51 33 66 TIM TIM TIM

Mobile customers (m) Fixed broadband customers (m) TV subscribers (000s) Q1 17/18 Q1 17/18 Q1 17/18 30.0 30.3 7.4 590 22.8

2.3 2.4 2.4 10

Vodafone TIM1 WindTre Vodafone TIM WindTre Fastweb Vodafone TV TIMvision

1. Including M2M 16 Our fixed footprint Homes marketable (Q1 17/18) (m) Homes marketable with NGN (Q1 17/18) vs. peers1

Not covered 28.6 26.9 DSL (ULL + BS) NGN Wholesale (FTTC) 13.3 Wholesale partnership 5.0 (FTTH Open Fiber) 3.5 Build (FTTC) 13.3m HHs 16.9m HHs 7.8m HHs 11.5m HHs

% HHs 12% 17% 47% 94% 100% Build + Strategic partnership + Wholesale FTTC FTTH Wholesale Up to 3.5m HHs 1.5m HHs 9.5m HHs 8.3m HHs Including Metroweb By 2022, across 271 cities in A&B areas Initial self-build programme; Strategic Potential for a FTTC VULA access reviewed following Open partnership with further 7m HHs via wholesale Fiber agreement Open Fiber in C&D areas agreement with TIM

1. Vodafone estimate and company reports 17 17 Commercial momentum in fixed and increasing NGN mix Net add performance (000s) Total broadband market share & share of net adds (LTM) (%)

Total broadband net adds NGN net adds Market share (Q1 17/18) Share of customer net adds (LTM) 46 38

23 18 14 15 15 14 10 6

224 TIM Vodafone Fastweb WindTre Others

168 140 NGN broadband market share & share of net adds (LTM) (%)

Market share (Q1 17/18) Share of customer net adds (LTM) 44 47

27 FY 14/15 FY 15/16 FY 16/17 22 24 14 13 7 1 1 TIM Vodafone Fastweb WindTre Others

Source: Company reports 18 FTTH delivering profitable growth Acquisition rate1 (Index: Copper=100) Churn rate (Index: Copper=100)

-50% 2.0x -40% 100 1.6x

100

Copper FttC FttH Copper FttC FttH

1. Annual sales expressed as a percentage of covered HHs (average) 19 Convergence still an untapped opportunity for Convergence adoption still limited in Italy Strategy on Convergence (% of fixed BB HHs with fixed-mobile bundles)

Get 100% of family SIMs from fixed 3.5x customers

35% Grow value with Vodafone TV and contents

10% Leverage on consumer IoT development

5% Increase ARPA and loyalty Italy 2014 Italy 2016 EU Top 5 2016

Note: Internal market research 20 Our convergence proposition

# Performance and reliability

Vodafone One • IperFibra and Mobile 4.5G

IPERFIBRA & 4.5G in a single offer • With Giga Vacanza take your broadband to satisfy all family’s needs connection on holiday • With Vodafone Always Connected you will never be left without Data or Voice services

# Best entertainment with Vodafone TV • IperFibra • Calls • Fixed line • SMS • NOW TV Entertainment • Giga + Pass social&chat • HD Experience • Maximum personalisation

# Exclusive advantages for your family

Vodafone TV IoT Add SIMs Pass • With Vodafone IoT, keep your most loved • Calls ones safe and connected • SMS • Giga • Additional SIMs for your family at an exclusive price 21 Convergence progress Converged customers and penetration ARPU and churn impact

Converged customers Converged BB RGUs as a % of consumer broadband customers1

600 ARPU uplift Customer churn reduction (%) 27% (Q1 17/18) (Q1 17/18)

500 -50% 400 20% 325 300 29%

+28€ 200 Mobile customer €27 ARPU uplift 14% 100

0 (7€) Q1 16/17 Q1 17/18 (€7) Typical discount Mobile Only Converged

1. Number of consumer broadband (RGUs) linked to a converged customer account relative to total consumer broadband customers 22 Vodafone Fixed/Convergence Open Office Vodafone Spain Market overview Total Service revenue (FY 16/17) (%) Vodafone consumer convergence revenue (%)

Vodafone 19

Other Convergence Non-convergence 10 €23.5bn Movistar 53 47 52 FY 16/17

19 Orange

Mobile contract customers (m) Fixed broadband customers (m) TV subscribers (m) Q1 17/18 Q1 17/18 Q1 17/18

13.3 6.0 3.7 11.6 11.4 4.2 3.2 1.3 2.1 0.5 2.1

Vodafone Orange Movistar Vodafone Orange Movistar Vodafone Orange Movistar

24 Our fixed footprint Homes marketable (Q1 17/18) (m) Homes marketable with NGN (Q1 17/18) vs. peers1

Total HH 28.9 ADSL Wholesale 27.7 NGN wholesale 19.2 Strategic wholesale Not disclosed partnerships

10.3 Own NGN network

19.2 HHs 18.0m HHs 18.8m HHs (E)

% of homes 36% 66% 96% 100% Strategic partnership & Buy + Self & co-build + wholesale Cable FTTH Wholesale

7.5m HHs 3.5m HHs 8.9m HHs Via Ono acquisition 690k overlap with cable Evolving towards DOCSIS3.1 Regulated access + new 1Gbps upload/download and FTTH co-build agreement strategic partnership with better experience with Orange Telefonica 25 25 1. Vodafone estimate Commercial momentum in fixed and improving mix Net add performance (000s) Total broadband market share & share of net adds (LTM) (%)

Total broadband net adds NGN net adds Market Share (Q1 17/18) Share of customer net adds (LTM)

42 36 36 400 29 28 22 308 317 5 300 2 2 (2) 227 TEF Vodafone ORA MM Other 204 212 209 200 NGN broadband market share & share of net adds (LTM) (%) 100 Market Share (Q1 17/18) Share of customer net adds (LTM)

38 41 0 30 1 29 FY 14/15 FY 15/16 FY 16/17 21 23

6 8 1 1 TEF Vodafone ORA MM Other Source: Company reports 1. Includes proforma ONO 26 Convergence strategy: using our new TV platform as differentiator

+120 channels

+65 channels Basic TV

Vodafone TV Esencial Vodafone TV Total

Movies / TV series

Vodafone Football

4K content + Cine 4k

Service and New experience Vodafone Motor improvement

27 Our convergence proposition

28 Convergence progress Consumer converged customers and penetration Consumer ARPU and churn impact

Converged customers Converged BB RGUs as a % of consumer broadband customers1

2,500 88% Convergence Customer churn reduction (%) 85% ARPU uplift (Q1 17/18) (Q1 17/18) 2,000 €37.5

1,500 21.8%

1,000 +28€ €46.2 Mobile customer ARPU uplift 8.4% 500

0 (7€) (€8.7) Q1 16/17 Q1 17/18 Typical discount Mobile Converged only customer customer 4P with TV 7.2% 3P w/o TV 9.3%

1. Number of consumer broadband (RGUs) linked to a converged customer account relative to total consumer broadband customers 29 Vodafone Fixed/Convergence Open Office Vodafone Germany Market overview Service revenue (€bn) Mobile service revenue share (%) Fixed revenue share (%)

FY 16/17 FY 16/17 FY 16/17 Telefonica United Internet 5 Vodafone 10 Telefonica Vodafone 21 Fixed 30 33 Unitymedia 12 50% €36bn 50% €18bn €18bn Mobile

37 52 Deutsche Telekom

Mobile customers1 (m) Fixed broadband customers (m) TV customers (RGUs m) Q1 17/18 Q1 17/18 Q1 17/18 45.2 42.0 45.2 13.0 7.7 6.3 6.4 4.4 3.0 2.1 3.4

Vodafone Deutsche Telefonica Vodafone Deutsche Telefonica United Unitymedia Vodafone Deutsche Unitymedia Telekom Telekom Internet Telekom

31 1. Includes IoT and MVNO customers Commercial momentum in fixed Net add performance (000s) Total broadband market share & share of net adds (LTM) (%)

Total broadband net adds NGN net adds Total BB market share (Q1 17/18) Share of BB net adds (LTM)

40 35

22 19 700 14 15 10 584 5 6 600 567 574 (2) 500 433 DT Vodafone UI UM TEF 400 376 322 300 NGN broadband market share & share of net adds (LTM) (%) 200 NGN market share (Q1 17/18) Share of NGN net adds (LTM) 100 45

0 31 1 25 FY 14/15 FY 15/16 FY 16/17 21 17 17 8 6 6 9

DT Vodafone UI UM TEF Source: Company reports 1. Includes proforma Kabel Deutschland 32 Our convergence strategy

CONVERGENCE

DIFFERENTIATION HH PENETRATION ARPU UPLIFT CHURN

Become the leading Focus sales on own Leverage Customer Base Bundle customers show converged operator – in an customers to increase and foster Cross Sell in the less churn and value add increasingly two-tier market share of wallet in own base FIXED & MOBILE Customer Base

33 Vodafone GigaKombi Our highspeed fixed & mobile combination for you and your family! 4G|LTE HOME MAX & SPEED With all Vodafone Red tariffs With all Internet & Phone tariffs

 Data flat with 4G|LTE Max up to 500 mbit/s  Highspeed Internet up to 500 mbit/s  Voice & SMS Flat  Fixed flat

 GigaDepot Starting at  TV packages optional bookable  GigaSharing for the whole family – 41,98 € per month with Red+ Allnet & Red+ Kids

Exclusive GigaKombi benefits  10GB for New Customers  Special GigaKombi Hotline Team  €10 bundle discount on mobile bill  Instant Access for new Fixed Customers  Additional €5 discount on every Red+ Allnet  Fixed to Mobile & Euro flat 34 Convergence progress Converged consumer customers and penetration ARPU and churn impact

Converged consumer Converged BB RGUs as a % of customers (000s) consumer broadband customers1

ARPU uplift Customer churn reduction (%) 8% (Q1 17/18) (Q1 17/18) 500 Typical discount: 400 5% -€10 300 15% Significant -50% Household mobile churn +28€ reduction in 200 +€19 ARPU uplift converged households

100 7-8%

0 (7€) (€8.7) Q1 16/17 Q1 17/18 Giga Kombi Mobile Converged

1. Number of consumer broadband (RGUs) linked to a converged customer account relative to total consumer broadband customers 35 Gigabit Investment Plan Our fixed footprint Homes marketable Q1 17/18 (m) Homes marketable with NGN Q1 17/18 vs. peers1 (m)

Not covered 40.0 38.9 26.2 ADSL wholesale NGN wholesale 12.6

Own NGN network 28m1 26m 13m1

% of homes 32 66 97 100 Recently announced fibre investment:

Buy + Wholesale + Own build & strategic partnership

Cable Wholesale FTTP

12.6m HHs 13.6m HHs Giga-Business Giga- Acquired through KDG Municipality Evolving Giga-Cable to Layer 2 VDSL DOCSIS 3.1 to deliver 1Gbps wholesale access Around 2,000 Around 1m download speeds with DT business parks households

37 37 1. Source: company reports, and Vodafone estimates Giga-Business: fibre to business parks German business park opportunity Strategic approach

38.9 2,000 business parks selected on basis of: Business parks1 32,000 • Revenue potential and existing infrastructure • Proximity to existing infrastructure to optimize costs for construction and backhaul KPIs per business park: In scope 2,000 • Minimum 40% penetration required to build • IRR >20%, Payback per park <4 years €1.4-1.6bn % of total 6 100 investment

• Vodafone fixed enterprise market share <15% • Fibre demand in enterprise bids doubled YoY • <25% of Vodafone’s enterprise customers are converged2

1. Source: German land registry office, Vodafone analysis 2. Excludes Soho customers 38 Giga-Business: partnerships built on telecom scale and expertise

Vodafone Germany Business model Strategic partner Build out after successful Deutsche Glasfaser example: Strong market position and assets pre-sales (>40%) Expertise • Number 1 challenger in fixed • Specialises in low-cost build out of • Own fixed access network (cable, Synergies with mobile backhaul fibre optic access networks DSL, fibre) Attractive cash-flow phasing through • Know-how transfer, scaling, speed, • Nationwide fixed footprint long-term contract and cost effectiveness • Best-in-class purchasing capability reflecting leading multi-country scale

Vodafone provides the service Partner builds and owns the customer the passive network Central Office Vodafone Passive fibre network backbone

39 Giga-Municipality: co-investment with local government % of households with <50 Mbps1 Opportunity Strategic approach

• ~25% of HH without access to ≥50Mpbs1 Municipality • Government expected to increase fibre • Builds and owns passive local access fibre subsidies network (after successful pre-sales) • Municipalities seeking higher speeds Vodafone • Rural areas particularly under-served • Builds link from the local access network to our fibre backbone, and installs active equipment • Pays rental fee per connected household

KPIs: • Targeting around 1m households, mostly rural areas • 33% minimum penetration per municipality • IRR >20%, Payback <6 years €0.2-0.4bn investment

1. Vodafone projections based on BMWI Breitbrandatlas 40 Giga-Cable: accelerating the upgrade to 1Gbps Vodafone household cable coverage and speeds

Opportunity Today In FY 19/20 Future • Half of new customers choosing ≥200Mbps in Q1 17/18 12.6m 12.6m Strategic approach 11m • 12.6m households upgraded to 1Gbps • 2 year DOCSIS 3.1 roll-out starting 2018; acceleration of original 4 year plan 7m • In combination with analogue switch off leads to capacity capex savings • Payback <4 years

2.5m €0.2bn investment1

100 200 400 500 1.0 10.0 Mbps Mbps Mbps Mbps Gbps Gbps 41 41 1. Excludes CPE which will be funded within the existing capex envelope Financial implications: overall Gigabit Investment Plan

Vodafone Germany • Incremental accrued capex of approximately €2bn over four years (FY 18/19 to FY 21/22)1 • Accretive to mid-term service revenue growth by 1-2pp, from the second full year of the plan (FY 19/20) • Incremental EBITDA margins materially higher than the current average2 • Giga-Business up-front cash outflows will be around one-third of accrued capital expenditure, with the balance paid over time

Vodafone Group • Annual drag on Group cash-flows of €100-200m during the initial years of the plan • No change to medium-term target of ‘mid-teens capex /sales’, excluding Gigabit Investment Plan capex which will be disclosed separately going forwards together with related KPIs

Success-based investment to drive attractive incremental growth and returns

1. In FY16/17 Vodafone Germany’s capital expenditure was €1.7bn (15.8% of revenue) and represented 22% of the Group’s total capex 2. In FY 16/17 Vodafone Germany’s EBITDA margin was 34.1% 42 Vodafone Fixed/Convergence Open Office Market overview Convergent customers Vodafone service revenue (%) Total retail revenue market share (%) market share (bundles, %) FY 16/17

(%) Others Others Vodafone 3 Vodafone 2 Fixed 21 9 25 NOS 30 NOS €0.9bn FY 16/17 43 Q4 16/17 +1.7% YoY Mobile 46 79 41 MEO MEO

Mobile customers (SIMs m) Fixed broadband customers (RGUs m) TV subscribers (RGUs m) Q4 16/17 Q4 16/17 Q4 16/17

1.4 1.3 1.6 7.7 1.4

4.7 4.5 0.5 0.5

Vodafone MEO NOS Vodafone MEO NOS Vodafone MEO NOS 44 Our fixed footprint Homes marketable (Q1 17/18) (m) Homes marketable with NGN (Q1 17/18) vs. peers Not covered

5.0

2.7 NGN wholesale

2.5 Own NGN network

4.0m HHs 4.0m HHs 2.7m HHs

% of homes marketable 50 54 100

Self-build + Acquired + Wholesale

FTTH FTTH FTTH

2.3m HHs 0.2m HHs 0.2m HHs 1.8m own-build driven by Call option exercise on Public funded rural network Project Spring, plus Optimus’ FTTH footprint with access obligations reciprocal access with Meo (0.2m) as a remedy in the covering an incremental Optimus/ZON merger 450k HH 45 High 3P prices pursued by incumbents used to squeeze mobile ARPU; keeping them low helped Vodafone retain value in mobile 3P prices determine the value perception Two possible reactions from … Always resulting in a positive of mobile “fixed” competitors outcome for Vodafone

Current public prices Phase 1 - substantial fixed growth (pay TV) Net Adds Customers EOP (m) Keep 3P prices & 0.5 0.5

… and lose fixed to Vodafone 0.4 4P 3P 3P Mobile (their first option) 37 0.3 €56.9 €44.9 €28.9 €27.9 0.2 0.1 12 Room or 0 €12 left for to mobile Phase 2 - substantial decline in mobile losses to convergence (net portouts) 56,9€ Reduce 3P prices NOS MEO … and lose mobile acquisition via 3P to 4P conversion (their current option)

Q1 Q1 Q1 Q1 Q1 13/14 14/15 15/16 16/17 17/18

Note: Consumer segment offers and numbers 46 Commercial momentum in fixed Net adds performance (000s) Total broadband market share & share of net adds (LTM) (%) Q4 16/17 Total broadband net adds NGN net adds FBB customer market share FBB net adds market share 50 50 150 40 38 128 122 125 118 18 112 110 96 100 (4) Vodafone MEO NOS 75 NGN broadband market share & share of net adds (LTM) (%) 50 Q4 16/17 NGN customer market share Net adds market share 25 47 38 33 0 26 26 FY 14/15 FY 15/16 FY 16/17 21

Vodafone MEO NOS

Source: Company reports, competitors earnings statements, NRA and internal estimates; NGN excludes fixed over mobile solutions 47 Our convergence strategy: ready for 4P

Two-stage strategy

SECURE THE BASE DRIVE 4P

FTTH FAST ROLL-OUT 3P FOCUS FOOTPRINT AND FIXED BASE No regulatory access; need Get in customers’ premise Strong platform to play convergence to speed up FTTH Gain scale (footprint and customer base) deployment Retain value in mobile Market is convergent and reasons for not pushing 4P now (self build or partnership) diminished. Let’s play 4P!

VODAFONE RED CHANNELS AND HR INVESTMENTS MONETISATION Red as the most important tool Gain capabilities and fully 4P customers churn less and are better targets for upsell for mobile retention readapt the way of selling opportunities Lead mobile data experience Positioning Vodafone as a Total Telecom provider

48 Wi FI 4X 4G Our convergence proposition faster

# Performance and reliability Vodafone Fiber (TV, Internet, Home Phone) • Fiber – Fastest speed available (1Gbps), 4X faster + Mobile Wi-Fi 4X Wi-Fi (powered by Vodafone Smart Router), TV, Smart router w/ 4X faster Wi-Fi & best 4G mobile faster lower latency network, in a single offer to satisfy all family’s needs • Award winning Best 4G mobile network 4G

• TV • Voice Calls • 4X Faster Wi-Fi • Texts # Best user experience with Vodafone TV • Fixed Phone • Mobile Data • TV interface renewed to a user centric experience; Fast Zapping Add SIMs • Variety of 4K & HD content available Vodafone TV • Netflix, FOXPlay & 3rd parties TV Apps on the TV Box • Calls • Text 4G • Data # Exclusive advantages for families Internet service 4X faster Wi-Fi + GB data for all family • Additional SIMs with + GB data for family members at exclusive prices Fixed Phone • TV available in all screens, to take entertainment Unlimited calls everywhere

49 Vodafone Fixed/Convergence Open Office EU regulation Vodafone – policy options for convergence investment

Deeper gigabit coverage Differentiation, Co-investment / innovation ownership Fairer industry profit distribution Equivalent passive access

Long term commercial Supports outdated agreements technology Quality & price discrimination

Regulatory Copper loop Regulated bitstream intensity unbundling or VULA 51 Using a flexible and capital smart infrastructure strategy

A market-by-market approach:

+ Immediate access DE ES NL Buy + Potential to deliver sign synergies – Time to integrate

+ Ability to differentiate ES PT IT Self or co-build + Higher margin – Capex intensive

+ Capex light ES IT IE DE Strategic partnerships + Immediate access – No/little ability to differentiate

+ Capex light Regulated wholesale access – No/little ability to differentiate In all markets – Low margin

Continuously optimising in every market 52 Perspective on convergence regulation Past 10 years Next 5 years

Support for Fibre High barriers to entry Control over own Mainly cable - fibre Co-investment emerging slowly convergence infrastructure Better access to Scale matters passive infrastructures

Less demand for regulated Allows for low risk market entry ... Fixed incumbent earns fixed access Regulated access super normal profits and Emergence of long term (in remaining areas) … but information asymmetry leads to endemic cross-subsidises mobile and commercial agreements discrimination and value transfer to incumbent content Legal action to fight against discrimination

Deregulation of competitive Deregulation of Encourage competitive fibre and 4G fibre competitive markets & 5G build out Mobile access ? generally unregulated

Scale matters Operator appetite Access to must have varies by market Regulation will need to address Churn prevention potential new access audio visual content Ineffective regulated & content bottlenecks Significant price inflation for football access to content

53 European Communications code status

EC has committed to the idea Ensuring competitive Supporting Gigabit that investment and access conditions to very investments competition are key, by... high capacity networks

Universal Level playing Access Institutions Spectrum service field

Harmonisation and Enhanced level More European Passive access Funds to be raised minimum 25 year playing field for all harmonisation: prioritised: positive, from general spectrum licences: communications positive, but pro fibre taxation or all positive, but and IoT service opposed by investment digital providers opposed by providers Council and BEREC Council

Parliament & Council finalise their Finalise Legal Implementation into Trialogue positions Text national legislation October 2017 6-12 months 3 months Up to 24 months 54 Forward looking statements

This presentation, along with any oral statements made in connection therewith, contains “forward-looking statements” within the meaning of the US Private Securities Litigation Reform Act of 1995 with respect to the Group’s financial condition, results of operations and businesses and certain of the Group’s plans and objectives. In particular, such forward-looking statements include, but are not limited to: expectations regarding the Group’s financial condition or results of operations including the confirmation of the Group’s guidance for the 2018 financial year; expectations for the Group’s future performance generally; expectations regarding the Group’s operating environment and market conditions and trends; intentions and expectations regarding the development, launch and expansion of products, services and technologies; growth in customers and usage; expectations regarding spectrum licence acquisitions; and expectations regarding, service revenue, adjusted EBITDA, cash flow, capital expenditure, and foreign exchange movements. Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as “ongoing”, “lead”, “surge”, “exceed”, “stabilise”, “maintain”, “sustain”, “improve”, “plans”, “targets” “gain”, “grow”, “continue”, “retain” or “accelerate” (including in their negative form). By their nature, forward-looking statements are inherently predictive, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, the following: changes in general economic or political conditions in markets served by the Group and changes to the associated legal, regulatory and tax environments; increased competition; the impact of investment in network capacity and the deployment of new technologies, products and services; rapid changes to existing products and services and the inability of new products and services to perform in accordance with expectation; the ability of the Group to integrate new technologies, products and services with existing networks, technologies, products and services; the Group’s ability to grow and generate revenue; a lower than expected impact of new or existing products, services or technologies on the Group’s future revenue, cost structure and capital expenditure outlays; slower than expected customer growth and reduced customer retention; changes in the spending patterns of new and existing customers and increased pricing pressure; the Group’s ability to expand its spectrum position or renew or obtain necessary licences and realise expected synergies and associated benefits; the Group’s ability to secure the timely delivery of high-quality products from suppliers; loss of suppliers, disruption of supply chains and greater than anticipated prices of new mobile handsets; changes in the costs to the Group of, or the rates the Group may charge for, terminations and roaming minutes; the impact of a failure or significant interruption to the Group’s , networks, IT systems or data protection systems; changes in foreign exchange rates, as well as changes in interest rates; the Group’s ability to realise benefits from entering into acquisitions, partnerships or joint ventures and entering into service franchising, brand licensing and platform sharing or other arrangements with third parties; acquisitions and divestments of Group businesses and asset and the pursuit of new, unexpected strategic opportunities; the Group’s ability to integrate acquired business or assets; the extent of any future write-downs or impairment charges on the Group’s assets, or restructuring charges incurred as a result of an acquisition or disposition; the impact of legal or other proceedings against the Group or other companies in the mobile telecommunications industry; the Group’s ability to execute its strategy in fibre deployment, network expansion, new product and service roll-outs, mobile data, Enterprise and broadband in emerging markets; developments in the Group’s financial condition, earnings and distributable funds and other factors that the Board takes into account when determining levels of dividends; the Group’s ability to satisfy working capital and other requirements; and/or changes in statutory tax rates and profit mix. Furthermore, a review of the reasons why actual results and developments may differ materially from the expectations disclosed or implied within forward-looking statements can be found under the headings “Forward-looking statements” and “Risk management” in the Group’s Annual Report for the year ended 31 March 2017. The Annual Report can be found on the Group’s website (vodafone.com/investor). All subsequent written or oral forward-looking statements attributable to the Company, to any member of the Group or to any persons acting on their behalf are expressly qualified in their entirety by the factors referred to above. No assurances can be given that the forward-looking statements in or made in connection with this presentation will be realised. Subject to compliance with applicable law and regulations, Vodafone does not intend to update these forward-looking statements and does not undertake any obligation to do so.

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