Tele2

8 May 2014, Telecruise

Michaela AngoniusGroup Head of Regulatory Affairs

1

Market presence and offered

servicesSweden

Full product suite

Norway

Full product suite

Germany

Mobile, Fixed broad-

band & telephony

Croatia

Mobile

Estonia

Mobile, Fixed

telephony

Latvia

Mobile

Lithuania

Mobile

Netherlands

Full product suite

Austria

Fixed broadband,

Fixed telephony

2

Kazakhstan

Mobile

EU legislation –

promoting or demoting investment?

When the European Commission adopted the Connected Continent proposal

11 September 2013, the following was stated:

“The legislation proposed today is great news for the future of mobile and internet in Europe. The

European Commission says no to roaming premiums, yes to net neutrality, yes to investment, yes to

new jobs.”

Stated by Vice President Neelie Kroes, 11 September 2013

“Further substantial progress towards a European single market for telecoms is essential for Europe’s

strategic interests and economic progress. For the telecoms sector itself and for citizens who are

frustrated that they do not have full and fair access to internet and mobile services.”

Stated by European Commission President Jose Manuel Barroso, 11 September 2013.

The Connected Continent regulation is meant to increase GDP in EU by 1% every year if delivered.

EU lagging behind – European Operators are not performing as well rest of

the world

Findings by the European Commission regarding the characteristics of

mobile wireless markets - U.S. vs. EU/EEA• Less product differentiation and consumer choice

• Slower pace of innovation

• Lower quality

• Lower intensity of use

• Sufficient rates of capital investments

• Lower revenues

Why did EC adopt the Connected

Continent Regulation?

Sweden

99% population coverage

Lower Quality?

The Netherlands

4G network being

rolled out

The Baltics

4G network being

rolled out

Sweden

90%Geographical coverage

Source: Open Signal – The State of LTE - 2014

Tele2 Sweden – One of best 4G networks in the world.

Lower intensity of use?

Source: (right hand graph) Cisco VNI Mobile, 2014(Left hand graph) Tefficient Public industry analysis #15 December 2013

2011-32

2011-52

2012-20

2012-40

2013-8 2013-28

2013-48

2G 3G 4G

Data growth Tele2 Sweden Global Mobile Data Traffic

Sufficient rates of capital investments

4G – 99% population coverage 4G roll-out initiated

Building a cutting edge 4G network Swap and 4G roll-out

Scale and efficiency by network

sharing

9

SwedenBest practice in network JV structure leading to

significant CAPEX and OPEX savings

NetherlandsSite sharing with T-Mobile

JV's CAPEX

& OPEX

Tele2 share

of JV's CAPEX

& OPEX

Tele2 saving

If Tele2 would

build own

network

CAPEX &

OPEX

100%

40%

50%

90%

RRH*

Antenna

T-

Mobile

base

station

Tele2

base

station

Backhaul Tele2

core

network

T-Mobile

core

network

2G

3G

4G

4G

X

X

X

*RRH = Remote Radio Head

Wrong diagnosis but right medicine?

Investing in telecommunication requires regulatory stability and future proof regulation

Forecasted Actual

Improved cost-efficiency by allowing for in- market consolidation

Population: 1.3 million

Nr. of operators: 3

Inhabitants per operator: 0.4 million

Population: 82.0 million

Nr. of operators: 4

Inhabitants per operator: 20.5 million

Population: 9,5 million

Nr. of operators: 4

Inhabitants per operator: 2.4 million

What would make EU regulation promote investment?

Summary

Regulatory stability

Same rules for equivalent services

Need for competition but also need for in-

market consolidation