1 For over 150 years, telecommunications has played a vital part in the development of modern Norwegian society. As the incumbent provider, Telenor has been the driving force in the development of a highly sophisticated home market and is now one of the largest mobile operators worldwide. The Telenor Group is dynamic and flexible in its business approach, always exploring new markets and new technologies to make long-term investments. This is part of the reason why Telenor has grown from a national telephone service company in Norway to become the world’s 7th largest mobile provider in less than two decades. At the time of its Initial Public Offering in 2000, Telenor had a mobile subscriber base of 15 million. By the end of 2008 this reached 164 million. The Telenor Group is now a driving force in the industry, engaging in pioneering research and technology development and other areas that are important to develop the core business of Telenor further. 1.1 Line of Business of Telenor Group The core business of Telenor Group is telecommunications. We provide voice, data, content and other communication services in 13 countries across Europe and Asia. These are the main services we provide to consumers and enterprises around the world: • Voice: Talk on the phone. From fixed-line to mobile or IP telephony, Telenor enables people to talk to each other using fast and reliable networks throughout the world. We sell fixed voice communication services in three Nordic countries and mobile voice in 12 countries across Europe and Asia. • Data: Internet and broadband. We offer fixed-line data services (e.g. ADSL and fibre-optic communications) in the Nordic countries, and mobile data services (e.g. mobile broadband, GPRS, UMTS) in 12 countries. As of 2008, 3G-based mobile broadband services have been launched in 7 of our operating countries. • Content: TV services and mobile content. Telenor offers TV services via cable, digital terrestrial and satellite networks in four Nordic markets. In several markets we also offer mobile content services (e.g. ring tones, music, movies, sports, and mobile TV). • Other services: 2 We offer a wide range of telecom-related services, and the service portfolio varies from country to country. In several markets we provide Net- centric services like IT security to consumers and enterprises and machine-to- machine (M2M) services for enterprises. We also provide IT consulting, maritime communications and aircraft communications services. Read more about other units of Telenor. • Other Units In addition to its own telephony and broadcast services, the Telenor Group has substantial activities in subsidiaries and joint venture operations. While some are seen as a pure financial investment, others are important in order to support and develop the core business of Telenor. Telenor Connexion Telenor Connexion is a world-leading provider of machine-to-machine (M2M) communication solutions. M2M refers to machines communicating with each other via wire or mobile networks. This form of automatic data transfer opens a range of possibilities, i.e. locating or tracking containers, temperature monitoring and automatic meter reading. Drawing on more than 10 years of M2M experience, Telenor Connexion is constantly exploring new fields in this rapidly growing business. In Europe alone there are several billion devices that could potentially be networked by wireless or fixed technologies. The company was established in 2008 and originates from the successful M2M business within Telenor Sweden. EDB Business Partner ASA EDB Business Partner ASA is one of the leading IT groups in the Nordic region providing an extensive range of consulting and information technology services to a broad range of industries and the public sector. The company has approximately 6000 employees working from locations in Norway, Sweden, Denmark, the Ukraine, Great Britain and India. It is headquartered in Oslo, 3 Norway, and the operating revenue reached NOK 6.3 billion in 2007. Telenor holds an ownership share of 51.3 per cent. Telenor Eiendom Holding Telenor Eiendom Holding is wholly owned by Telenor. At the end of 2007, the company managed approximately 900,000 square metres of owned and leased floor space spread out over approximately 5,200 buildings. The company's main task is to ensure that the Telenor Group has at its disposal sufficient premises to allow its main activities to be performed in a cost effective manner. Telenor Global Services AS Telenor Global Services AS (TGS) is the international carrier of the Telenor Group. The company has years of experience in delivering high quality services to mobile and fixed operators around the globe. TGS understand the needs of today’s communications providers - which is why we have developed an industry leading focus on Quality of Service (QOS) and earned a reputation as a world class quality International Carrier. The extensive mobile operators of the Telenor Group, with more than 160 million subscribers use TGS to deliver high quality international services to their growing subscriber base. TGS suite of services combined with our networking and QOS expertise allows you to focus on your customers, with the peace of mind that your voice, video, data and IP services are being delivered by a world class partner. TGS has been a limited company since 1995, wholly owned by the Telenor Group. Telenor Research and Innovation Telenor Research and Innovation (R&I) is an innovation hub for the Telenor Group with particular focus on strategically driven innovations with a long-term perspective. The 4 R&I unit’s competence areas include users, markets, business models, technology and commercialization. Experimentation, testing and demonstration facilities are part of the work. Telenor R&I practises an open innovation model based on cooperation with leading users, businesses, universities and institutes. R&I is a competence resource centre for the Telenor Group, providing expertise and advice, and challenges to management on existing strategies and business mindset. The unit also provides significant support to the business units through joint projects. In addition to the R&I centres in Fornebu, Tromsø and Trondheim, a new centre was established in Malaysia in 2006. This Asian centre (TRICAP) focuses on social media and growth market opportunities. R&I is wholly owned by Telenor. Telenor Venture Telenor has since 1993 been actively investing in emerging companies within the information and communication technology sectors through the investment firm Telenor Venture. The company currently manages two funds; Telenor Venture IV AS where Telenor has a 51 per cent stake (the rest is owned by an investment firm), and Telenor Venture VII AS which is wholly owned by Telenor. Telenor Venture seeks to capitalise on the competencies, technology and network of the Telenor Group, and has during the recent years had success with spin-offs from the Telenor Group. Maritime Communications Partner AS Maritime Communications Partner AS (MCP) is a global maritime cellular operator focused on providing cost effective GSM and CDMA communications solutions specially created to fulfil the requirements of the shipping industry. MCP provides seamless connectivity via personal mobile phones to both passengers and 5 crew on board cruise-ships, ferries and other vessels worldwide. MCP is wholly owned by Telenor. Aeromobile Ltd AeroMobile Ltd enables aircraft passengers and crew to safely use their own mobile phones and PDAs whilst in-flight to keep in touch with colleagues, customers, friends and family. AeroMobile supports voice telephone, text messaging and data services using current and future aircraft communications technologies. Telenor owns 75 per cent of Aeromobile, the remaining 25 per cent is held by Arinc. More Mobile Relations More Mobile Relations is a mobile marketing agency majority owned by Telenor. The company is a merger between the Norwegian company Active Loop Marketing, the Swedish company 12-snap Lokomobil and the Danish company N’volve. More Mobile Relations offers a broad range of digital and interactive concepts that utilise the mobile phone as the key platform. These concepts range from mobile campaigns, mobile CRM, mobile learning, mobile-in-store and mobile web sites. 1.2 Global presence The major part of our business is organised in three regional entities: • Asia: Bangladesh, Malaysia, Pakistan, Thailand and India. • Nordic countries: 6 Denmark, Norway, Sweden and Finland. • Central and Eastern Europe: Hungary, Montenegro, Russia, Serbia and Ukraine. 1.3 Employees and Subscribers Telenor Group is among the largest mobile operators in the world with • 39,250 employees • 166 million subscribers • 13 countries • 154 years of history 7 8 2.1 Introduction Telenor Pakistan is 100% owned by Telenor ASA and adds on to its operations in Asia together with Thailand, Malaysia and Bangladesh. Telenor Pakistan launched its operations in March 2005 as the single largest direct European investment in Pakistan, setting precedence for further foreign investments in the telecom sector. The company has crossed many milestones and grown in a number of directions, making Telenor Pakistan a leading telecom operator of the country. Telenor is the fastest growing mobile network in the country, with coverage reaching deep into many of the remotest areas of Pakistan. In the most difficult terrains of the country, from the hilly northern areas to the sprawling deserts in the south, at times we are the only operator connecting the previously unconnected. Telenor is keeping ahead by investing heavily in infrastructure expansion. With USD2 billion already invested, we have extended agreements with their vendors for network expansion and services until 2009. The agreements, with a potential to result in USD750 million worth of orders from Telenor Pakistan, are some of the biggest of their kind in the industry. Telenor is spread across Pakistan, creating 2,500 direct and 25,000-plus indirect employment opportunities. Telenor has a network of 23 company-owned sales and service centers, more than 200 franchisees and some 100,000 retail outlets.