Sweden’s largest coverage

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Contents

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The Swedish market

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Net 1 focus area

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Network

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Products

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Consumer Segment

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Business Segment

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The Swedish market

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The Swedish market  Population 9.3 million inhabitants in Sweden  4.5 million broadband subscriptions on 30 June 2010

 1.5 million mobile broadband subscriptions

End of June 2010, 45 % of broadband subscriptions had a transmission capacity of 10 Mbit per second or more downstream. Total telecom market hardly showing growth. Industry revenue stable at around 50bn SEK since 2002, with fixed telephony as a bigloser Mobile Data, excluding SMS/MMS, currently account for ~5% of industry revenue and shows significant growth, albeit from a small base.

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The Swedish market Swedish broadband 5 000

100% 90%

4 000

80% 70%

3 000

60% 50%

2 000

40%

 Fixed broadband growth losing pace – the negative trend for fixed broadband is expected to continue.  Mobile broadband household penetration expected to surpass fixed penetration 2013

30% 1 000

20% 10%

0

0% 2005

2006

2007

2008

2009 1H 2010

Fixed Broadband

Mobile Broadband

BB penetration on HH (%)

MBB penetration on HH (%) 5

Coverage

Net 1

Telia/Tele2

3

Telenor

Net 1 Focus Area

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Net 1 Focus Area Defining Net 1s segmentation base for consumer

1 2 3 4

Forest counties inland Forest counties mid/east Cities / Urban South Total

Sweden 341 237 1 415 574 3 682 117 3 817 419 9 256 347

15% 20% 30% 25% 26%

27 260 87 599 109 787 290 470 555 268

2 20 12

M S Cu st om er s2 01

City 159 501 977 577 3 316 160 2 655 541 7 108 779

Ta rg et

Countryside 82 535 406 702 338 917 1 144 819 1 972 973

M ar ke t

Rural 99 201 31 295 27 040 17 059 174 595

Pe

ne tr at io n

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Addressable market rural and countryside population in the following areas

40% 30% 3% 20% 18%

10 904 26 280 2 964 58 094 98 242

Addressable market is 2,15 million individuals living in approx. 900K households.

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ATL strategy, Fall 2011  Net1 only focus on areas with pop density less than 20 pop/sq km and current market share above 2%*

 Total target population ATL (Above the line marketing) is 2,4 million pops, or equivalent to 1 million households – in line with high level segmentation on rural and country side market.

Market share and pop density 14,0%

12,0%

180

160 140

10,0% 120 8,0%

100

6,0%

80 60

4,0%

40 2,0% 0,0%

Market share Pop / sq km

20 0 * Market share based on

a market of individuals with access to MBB.

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Network

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Historic Network  Frequency and capacity 450 MHz operation 4,5 MHz bandwidth

 Infrastructure 360 BTS in Sweden 2 Core site 1 1x and 2 EV-DO carrier  Features Mobile Broadband, Mobile Telephony, PTT (Trustar, GoTa), SMS, MMS, LBS (A-GPS, gpsOne), SIM/RUIM, Roaming Extended range

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Network Data  Frequency and capacity 450 MHz operation 5 MHz bandwidth

 Infrastructure 420 BTS in Sweden 2 Core site 4 EV-DO carrier  Features Mobile Broadband Extended range QoS

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Products

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Product space overview

End user Back end system

End user Operations

Device Monitoring

Customer Operations

Network Operations

CRM/Billing/WEB

OSS

Network Communication Device/Modem

End user device 14

Product model  Hardware and Usage Device type Usage of Mb or Gb per month

 Quality and Priority QoS Priority level Access level

 Security VPN Fixed IP L2TP

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Consumer – Products  Broadband router with WiFi

D35 (Axestel) Rev A, Router 3,1/Mb, WiFi 4xRJ45 Ethernet, 1xUSB

 Broadband router with WiFi and analog VoIP

D40 (Cmotech) Rev A, Router 3,1/Mb, WiFi 1xRJ45 Ethernet, 1xRJ11 analog phone, 1xUSB

 Broadband USB dongles

D50 (Cmotech) Rev A, Dial up 3,1Mb 1xUSB D51 (Cmotech) Rev B, Dial up 9,3Mb 1xUSB D60 (Cmotech) Rev A, Dial up 3,1Mb, GPS 1xUSB 16

Business – Products  Rugged Devices with and/or keep a live function

Nexpring, Fältcom, Digi, Anyway, Mobicom Rev A, Router 3,1Mb, WiFi, battery Ethernet, RS232/422/485, analog/digital I/O, switching relays, CAN-bus, GPS

Rev A, Dial up USB

 Narrowband and AMR

Tritech, Xemex, TransData Rev A/B, Router/AMR, 869MHz 25k Mesh radio, M-bus, RS232, Relay controls

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Consumer segments

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Consumer Rural population A significant amount of our population live in rural areas were decent Internet services are limited compared to other areas. People living in rural areas shows the most mature online shopping behavior among Swede's.  2 150 000 inhabitants are living in rural areas.  Large geographical spread concentrated to the inland of northern Sweden.

Solutions: Mobile broadband, fixed wireless telephony

Source: Statistics Sweden, the Swedish National Rural Development Agency, The Swedish Post and Telecom Agency

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Interest groups Boat owner segment Boat life is one of Sweden’s largest movements with one third of the adult population travel at least once per year on a leisure boat. Net1 have superior coverage along the coasts and in our archipelagos.  718 000 registered leisure boats  147 908 registered leisure boats with overnight possibilities.  1 000 boat associations with a total of 250 000 members.  2 million adults travel on leisure boats every season.

 Boat life is increasing and is expected to increase in the future Source: SweBoat 2008

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Interest groups Vacation houses There are a large number of vacation houses in Sweden. Spending holidays in a vacation house is very common for Swedish families, main seasons are summer and winter.  680 000 registered vacation houses. An important part of the target group are also those who have access or rent vacation houses (not included above)

 Work updates, weather information, convenience matters Solutions: Mobile broadband - Work updates, weather information, convenience matters

Source: Statistics Sweden

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Interest groups Caravans & motor homes Caravans and motor homes has a strong traditional position among Swede’s and is a very popular way of spending family vacations.  265 000 caravans in use every year.  43 000 motor homes in use every year.  Active campers are concentrated to areas outside Sweden´s three conurbations.  Campers mainly travel in Sweden. Some travel to other Nordic countries.  Average usage: 24 days on the road, 16 nights at camping sites distributed at 5 different sites. Source: Husvagnsbranschens Riksförbund (the Swedish Caravan Association)

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Business segments

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Transport on land The need for high data speed across the country is increasing to be able to communicate in real time. Offering Internet services to travelers is becoming more common among travel operators.  23 809 companies  102 421 potential users Solutions: Telematrics, mobile Hot-Spot solutions, access to business critical applications Typical customers: Road carriers, railway companies, busses, delivery firms, etc. Customers: Flygbussarna, Veolia transport, Strömma buss

Source: Statistics Sweden

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Transport at sea The sea transport and shipping companies need costal coverage with an increasing demand for high data speed. Real time communication in a robust network is key, since it simplifies their daily operation.  1 122 companies  12 291 potential users Solutions: Access to mission critical applications, Mobile Hot Spot solutions, telematics, telephony.

Typical customers: Passenger traffic, freight traffic

Source: Statistics Sweden

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Forestry Communication in remote places is a critical need, both from a personal safety and productivity aspect.  106 665 companies (approx. 80% 1 man co’s)  119 821 potential users* Solutions: Telematics, access to business critical applications, telephony, PTT, positioning. Special coverage for enterprise telephony solutions Customers: Svea Skog, SCA, Stora Enso

Source: Statistics Sweden

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Security & Surveillance Robust solutions providing high data speeds with nationwide coverage can be used for different applications in surveillance.  1 034 companies  14 652 potential users

Solutions: Video surveillanc, transmission, access to mission critical applications, telephony, PTT, positioning etc.

Source: Statistics Sweden

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Power & distribution The power companies are active in remote areas with the need for data speeds as well as security and safety solutions.  1 426 companies  26 319 potential users

Solutions: Telematics, access to business critical applications, video surveillance, telephony, PTT and positioning Customers: Vattenfall, SkellefteKraft, Göteborgs energi, Jämtkraft, Mitt Sverige Vatten AB

Source: Statistics Sweden

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Construction The need to set up communications fast at construction sites is crucial. Mobile solutions with high data speeds and great coverage is important.  60 000 companies  450 000 potential users* Solutions: Access to business critical applications, telephony, PTT, positioning

* Includes both self employed businesses and employees.

Source: Statistics Sweden

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Mining Industry Sweden have 16 mines with mainly lower world breaking with 6 owner groups (LKAB, Boliden, Minmet, Lovisagruvan, Svartliden Guld and Lundingruppen.  Total production value: 19 billion  Approximately 5 100 employees in mining and smelting plants.

Source: Government offices of Sweden - Ministry of Enterprise, Energy and Communications

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Fishing Industry Fishing have always been an important resource for human beings. Today, there are over 2,000 professional fishermen in Sweden, who´s catch each year reaches a market value of around one billion kronor.  1 479 licensed fishing vessels  1 807 licensed fishermen The total number employed in this sector is larger since employees working at fishing vessels doesn´t always hold a licensed.

Source: The Swedish Board of Fisheries

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Rural business For the business community in Sweden’s rural and sparsely populated areas, communication infrastructure is a critical aspect in developing competitive businesses and keeping up with the metropolitan areas.  85 000 companies  38 000 companies – Net 1 only option for Mobile Broadband access  Large geographical spread

Source: Statistics Sweden, the Swedish National Rural Development Agency, The Swedish Post and Telecom Agency

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Public sector Robust solutions providing high data speeds with nationwide coverage is a key criteria within different areas in this sector.    

1 500 000 potential users Blue- and yellow lights Healthcare Municipalities

Solutions: MBB, VPN access, telephony, PTT and positioning, video surveillance, video conferencing Customers: The Swedish Police, Swedish Coast Guard, Regional Council, Ambulance Services

Source: Statistics Sweden

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