CMD2011 - Gunther Vogelpoel - Market Area Western Europe

Capital Markets Day 2011

Market Area Western EuropeGünther Vogelpoel

Sep 20112 Capital Markets Day 2011

Market Area Overview

OutlookNetherlands: Grow in mobile and SME,

Upcoming license auctionAustria: Continue growth in B2BGermany: Develop mobile product

Leading the group in business to business services and consumer fixed broadband

Represents 21% of total net sales Q2 2011:

Netherlands: 15% Germany: 3%

Austria: 3%


Netherlands


Strong Presence in Fixed Services

Sales: EUR 180mn

B2BB2B

Sales: EUR 70mn

WholesaleWholesale

Sales: EUR 370mn

ResidentialResidential

Strong presence through three segments Full product portfolio Own fibre network Brand value, 15 years of presence One out of four TV providers B2B high quality reference list


Operational Performance

Solid financials Top line under pressure Integration costs already in 2011

Net SalesSEK Million

EBITDASEK Million

EBITDA-CAPEXSEK Million


Our Strengths

Residential strengths:

Maximize value in customer base Solid position in DSL and growing

in Triple Play product Now on-net and off-net TV VDSL: increased bandwidths to

compete with coax Best deal: low price, high quality

Business strengths:

High margin operation Supports a wide range of

businesses and institutions across the country

Mission critical services

http://newsroom.tele2.nl/wp-content/uploads/2011/04/stempel-PCM.png


Business Outlook for 2012

Overall objective B2B market: Topline growth Strengthen Tele2’s position in the market as the alternative to KPN through the

integration of Bbned Lower costs through standardization and quality improvement

Strengthen position & capabilities in SME segment: Standardize portfolio for SME Increase distribution through indirect channels

How?

How?


Evaluating a move from MVNO to MNO

Grow long term cash flows.

Strong Group experience in mobile.

The opportunity in NL is unique and now. The upcoming auction will set the scene till 2030.


Auction Conditions

Auction planned for Q1 2012 2x10 MHz reserved in the valuable 800 MHz band for new

entrants. Auction start-price per 2x5MHz 800 license is EUR 35 mn. Roll out obligation for low frequencies will be stricter than

for high frequencies. Network sharing is allowed, not frequency sharing.


The Opportunity is Now3. Technology

& Business Models

3. Technology & business models will change! Tele2 is able to provide (disruptive) high speed data & voice propositions. MNO’s

are unwilling to cannibalise on high profit levels .

1. Government stimulates competition & newcomers:

exclusive 2X10 MHz reservation for ‘newcomers’ (without 900 MHz)!

2. Tele2 NL already has strong

(fixed) presence, brand, MVNO

experience & national fiber network.

1. Government& Regulation

Spectrum AuctionUnique newcomer

allocation

Net Neutrality2nd country in the

world enforcing net neutrality

Data UptakeFrom low starting

point

Data UptakeFrom low starting

point

Low CompetitionHigh price/cost

incumbents

Low CompetitionHigh price/cost

incumbents

2. MarketOpportunity

New Devices & Services

All focus on data use

LTEApproaching critical mass


Austria



Maximize value in residential. Top line growth in B2B. Profit contribution solid.


EBITDASEK Million



B2B Sales Engine

180% increase in B2B sales intake (H1 2011 vs. H1 2010).

EBITDA margin to 21% from 15% (H1 2011 vs. H1 2010).

31% increase in operational cash flow (Q2 2011 vs. Q2 2010).


Germany



Overall decline in top line. Strong operational performance

in sustaining profit levels.


EBITDASEK Million



Traffic

TELE2

Accessline

Shifting to Value in Our Customer Base

Customer typically pays EUR 16.07/month for fixed voice access line; can cancel with 6 warning days.

DTAG handles any customer service with respect to the access line, e.g., technical requests.

Customer pays for voice usage. Price plans include pay-per-minute and flatrates. TELE2 handles any customer service with

respect to voice telephony, invoicing, etc.

Tele2Tele2

Telekom DeutschlandTelekom Deutschland

Currentsituation


Tele2 Germany is Going Mobile

MNO

INCUMBENT

Futuresituation


One single invoice from Tele2.

Keeps fixline extension and tariff.

Mobile Home Telephony: Our Value Proposition

MNO

ConvenienceConvenience Lower feesLower fees New handsetNew handset

Subsidized, high quality “DECT look-a-like“ phone.

Savings of more than 2 € every month.

CMD2011 - Gunther Vogelpoel - Market Area Western Europe

Investor Relations

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