Mobile Strategy Head of Global Coordination - Ragnar H

Home , Viettel, Vinaphone

Mobile Strategy Head of Global Coordination - Ragnar H. Korsæth Continued Growth in Revenues and Cash Flow

• Strengthen local position and competitiveness

• Targeting the world’s next billion mobile subscribers

• Selective international expansion Internationalisation of Telenor

Expansion Licence Control or Selective Hunting Exit Expansion Strategy

1995 2000 2005

Value Network and Active Global Creation Service Ownership Coordination Strategy Rollout GrameenPhone Performance

Subscriptions/Market share ARPU MoU/APPM

1 099 6 427 244 227 233 5 542 913 196 674 4,8 516 3,8 62 % 2 388 2,9 2,6 62 % 62 % 62 % 1 141

2003 2004 2005 Q1 2006 2003 2004 2005 Q1 06 2003 2004 2005 Q1 2006

Revenues/EBITDA% EBITDA and CAPEX

29 524

EBITDA CAPEX 20 890 19 302

14 667 All figures according to 12 695 11 59211 636 local currency. 8 269 2003-figures are not according to same 65 % 60 % 3 545 accounting principles 50 % and KPI definitions as 2004-2006. EBITDA and CAPEX 2003 2004 2005 adjusted for change in 2003 2004 2005 accounting treatment of lease in 2005 Kyivstar Performance

Subscriptions/Market share ARPU MoU/APPM 14 965 13 925 110 98 68 67 83

49 56 40 6 252 1,2 47 % 0,8 3 037 45 % 46 % 45 % 0,5 0,4

2003 2004 2005 Q1 2006 2003 2004 2005 Q1 06 2003 2004 2005 Q1 2006

Revenues/EBITDA% EBITDA and CAPEX 5 769

EBITDA CAPEX

3 212 3 341 2 896

2 044 2 065 2 001 All figures according to 1 195 61 % 60 % 56 % local currency. 744 2003-figures are not according to same accounting principles and KPI definitions as 2003 2004 2005 2003 2004 2005 2004-2006 DiGi Performance

Subscriptions/Market share ARPU MoU/APPM 5 086 4 795 62 175 60 169 58 166 162 54

3 239

2 205

0,36 0,36 0,34 0,33 25 % 25 % 20 % 22 %

2003 2004 2005 Q1 06 2003 2004 2005 Q1 2006 2003 2004 2005 Q1 2006

Revenues/EBITDA% EBITDA and CAPEX 2 899

2 231 EBITDA CAPEX

1 714 1 259

979

44 % 43 % 41 % 699 688 563 520 All figures according to local currency. 2003-figures are not according to same accounting principles and KPI definitions as 2003 2004 2005 2003 2004 2005 2004-2006 Mobile Norway Performance

Subscriptions/Market share ARPU MoU/APPM 323 323 309 305 186 2 731 2 722 2 645 184 184 2 364

176 57 % 56 % 56 % 56 % 1,8 1,8 1,7 1,6

2003 2004 2005 Q1 06 2003 2004 2005 Q1 2006 2003 2004 2005 Q1 2006

Revenues/EBITDA% EBITDA and CAPEX

12 243 11 730 10 909 EBITDA CAPEX

4 262 4 305 4 471

39 % 37 % 37 % All figures according to local currency. 2003-figures are not 973 1 218 500 according to same accounting principles and KPI definitions as 2003 2004 2005 2003 2004 2005 2004-2006 Continued Growth in Revenues and Cash Flow

• Strengthen local position and competitiveness

• Targeting the world’s next billion mobile subscribers

• Selective international expansion Telenor’s Operating Model

Market dynamics and responsiveness is local • Operational decision making • Control of value chain • Production, marketing and service delivery

Centralisation Stand-alone & Integration Global Coordination Operations

Group standards Best practice sharing Global Service Innovation

• Coordinated sharing of proven concepts

• Virtual service market place

• Common service delivery platform

• Innovation Centre in Malaysia Investment Optimisation Telecom Equipment Prices 100

• Joint group procurement processes 40

20 • Aligning vendors on future low 0 ARPU challenges 2002 2003 2004 2005 2006

Network Efficiency • Early adaptation of new (Erlang per TRX) 5 technology 4,5

3,8 • Decreasing CAPEX per minute 3 2,4

2002 2003 2004 2005 2006 Continued Growth in Revenues and Cash Flow

• Strengthen local position and competitiveness

• Targeting the world’s next billion mobile subscribers

• Selective international expansion Strong Mobile Growth Potential

Expected Subscription Growth 60 by 2008 (million)

• Current population footprint of 650 million

• Expect the total market to grow with 20 ~130 million subscriptions by 2008 18 15 12

4 1 Hungary Malaysia Thailand Ukraine Bangladesh Pakistan Russia

Source: Telenor estimates The Next Billion Challenge

The first billion subscriptions The next billion subscriptions ¾ More than USD 25 ARPU ¾ Less than USD 2 ARPU How to Make Money on USD 2 ARPU No Subscriber Acquisition Costs No Customer Support Example Hourly Traffic Profile (Traffic minutes per hour) Monitor the Peak Hour 00:00 02:00 04:00 06:00 08:00 10:00 12:00 14:00 16:00 18:00 20:00 22:00 Extremely efficient distribution From Scratch Cards to E-Refill Vendor Revenue Share Model Predicable Regulatory Regime Continued Growth in Revenues and Cash Flow

• Strengthen local position and competitiveness

• Targeting the world’s next billion mobile subscribers

• Selective international expansion Selective Expansion Criterias

• Market size and penetration growth • Political stability • Regulatory environment

• Cultural fit • Strong business case Egypt Opportunity Subscriber development (000)

8000 7000 6000 5000 4000 Facts 3000 • Population 2005 (millions) : 75 2000 1000 • Penetration 2005 : 17% 0 • GDP/pop 2005 (USD) : 1380 2003 2004 2005 • GDP growth : 5% Mobinil Vodafone

Market share (%) Strategic Rationale 100 % • The MENA region has untapped potential 90 % 80 % • Low penetration 70 % 60 % • Large and fast growing market 50 % • Utilize Telenor’s greenfield expertise 40 % 30 % 20 % 10 % 0 % 2003 2004 2005

Mobinil Vodafone Vietnam Opportunity Subscriber development (000)

4000 3500 3000 2500 2000 1500 1000 500 0 Facts 2003 2004 2005

• Population 2005 (millions) : 84 Vinaphone Mobifone Viettel S-fone • Penetration 2005 : 10% • GDP/pop 2005 (USD) : 616 Market share (%) • GDP growth : 8% 100 % 90 %

80 % Strategic Rationale 70 % 60 % • Within a core region 50 % • Low penetration 40 % 30 % • Large and fast growing market 20 % 10 % 0 % 2003 2004 2005

Vinaphone Mobifone Viettel S-fone Serbia Opportunity

–Mobtel/Mobi63 Subscriber development (000)

3500

3000

2500

2000 Facts 1500 1000

• Population 2005 (millions)* : 7.5 500 • Penetration 2005 : 65% 0 • GDP/pop 2005 (USD) : 2.500 2003 2004 2005 • GDP growth (2006-2007) : 5% Mobtel/Mobi63 M TS (TelekoM Srbija)

* Excluding Montenegro and Kosovo Market share (%)

100 %

90 %

80 % Strategic Rationale 70 % • Within a core region 60 % 50 % • Synergies with Promonte and Pannon 40 % 30 % 20 % 10 %

0 % 2003 2004 2005

Mobtel/Mobi63 MTS (Telekom Srbija) Concluding Remarks

• Strengthen local position and competitiveness

• Targeting the world’s next billion mobile subscribers

• Selective international expansion

Continued profitable growth