MAVAM Argentina - English version 04/04/2011

ARGENTINAPrepared by 1˚ EDITION MAVAM Acision Monitor for Mobile VAS© Copyright Acision March 2011

MAVAM | Acision Monitor for Mobile VAS Editorial MAVAM Argentina By mid of 2010, Latin America became the second region of the world regarding number of mobile phone service subscribers. Globally-speaking, sales in the region account for 10% of mobile operators revenues. Main countries in Latin America already exceed the 100 lines per 100 inhabitants. Today, a new stage begins in the region, in which the Value Added Services (VAS) will be increasingly more relevant for the growth of mobile operators’ revenues. Besides the proportional increase of VAS, the region’s economic growth is added, where most of the countries will grow at rates over 4% annual of GDP. VAS in the region already accounts for 21% of mobile operators’ revenues, while in most developed countries this segment already reached 50%. With no doubt, Latin America will Rafael Steinhauser follow this trend regarding the VAS share in the operator’s total business. Acision President for Latin America In Argentina, during 2010, VAS accounted for 37% of mobile operators’ revenues; thus Argentina is ranked first within Latin America regarding this category. Acision, global mobile data solution leader, has created MAVAM (Acision Monitor for Mobile Value Added) in September 2009, in order to assess status and evolution of main trends in the VAS market. Each edition of MAVAM monitors six VAS areas: messaging, data (mobile broadband), mobile marketing / advertising, mobile banking / payment, entertainment and social networks. Since its launch in 2009, MAVAM is quarterly published in Brazil. In December 2010, MAVAM started to expand throughout Latin America and it presented its first edition of MAVAM Mexico. Acision is today honored to present first edition of MAVAM Argentina, thus providing a half-term report that will enable to keep track of the evolution of value added business. Thus, through this study, our intention is to provide systematic and recurrent information for all players of the telecom industry. It is a consultation and forum tool for the new generation of mobile businesses. Worth reading it. |3|

MAVAM | Acision Monitor for Mobile VAS Index 2 Editorial 4 1. Introduction 5 1.1. Value Added Services in the World 9 1.2. Value Added Services in Latin America 10 1.3. Value Added Services (VAS) in Argentina 12 2. MAVAM (Acision Monitor for Mobile VAS) 13 3. MAVAM Argentina 13 3.1. Message services 15 3.1.1. SMS 16 3.1.2. MMS 17 3.1.3. Instant Messages (IM) 17 3.1.4. Voice mail 18 3.1.5. E-mail 19 3.2. Entertainment 21 3.2.1. Games (Use and downloads) 23 3.2.2. Music (Use and downloads) 24 3.2.3. Ringtones (Downloads) 24 3.2.4. Images ( Downloads) 25 3.2.5. Video ( Downloads) and Mobile TV (Watching) 25 3.3. Mobile Internet 27 3.3.1. Social Networking 28 3.3.2. Mobile Money and Mobile Banking 29 3.3.3. GPS and Maps 29 3.3.4. Mobile Marketing and Advertising 32 4. Conclusions 33 5. Technical Data Sheet 34 6. Glossary 37 7. Team |4|

MAVAM | 1. Introduction 1 Introduction By the end of the year 2010, there were 5.41 billion service subscribers worldwide, out of the 6.92 billion total inhabitants, which means a penetration of 78 cell phones every 100 inhabitants. Pursuant to the estimations made by Convergencia Research América Latina3, by the end of 2010 there were 559.74 million mobile subscribers equivalent to 10.37% of the total global lines. The average penetration in the region is 96 lines every 100 inhabitants; and between 2011 and 2012 every country, except for Cuba and Nicaragua, will exceed 100% penetration. In 2010 the global revenue generated by mobile phone services was equal to around 800 billion Dollars5, which is equivalent to 1.3% of the Gross World Product (GWP). Pursuant to the estimations made by Convergencia Research, the revenue derived from mobile phone services in Latin America in 2010 was about 81 billion Dollars, which amounts to 8.5% of the global business of mobile services. Latin America is not an exception to the transformation of the mobile services industry, which is taking place globally: saturation of penetration rates, new devices, and increase in the data traffic, among others. Notwithstanding that, the economic projections made by most countries with their gross domestic products growing above 4%, generate conditions which are more than optimistic to face this transformation process in which value added services (VAS) will play a key role. Graphic 1. Mobile Subscribers 2010 Mobile Revenues 2010 Total world as of Q4 2010: 5400 Million Total world 2010: 796 billion1 Source: Report by Telecoms & Media WCIS+, 4G Américas’ Web site2 Source: Estimations made by the World Bank.3 Includes Latin America, Caribbean, Central America and Mexico.4 Data assessed on the basis of balance sheets, regulators and own estimations.5 Source: Estimations made by Convergencia Source: Convergencia Research based on the balance of the operators, local regulators and the Internacional Research. Telecommunication Union (ITU). |5|

MAVAM | 1. Introduction 1 1. Value Added Services in the World In order to show the global impact of VAS on the business of mobile phone services, a sample was selected which includes seven companies with presence in different countries (See graphic 2). At each company, an analysis was conducted of the total revenue evolution from December 2009 to December 2010, and the evolution of the participation of the revenues obtained from VAS in relation to each company’s total sales. VAS services basically include: SMS and MMS (messaging service), music, videos, games, ringtones (entertainment), mobile banking and payments, mobile broadband, social networks, and marketing / mobile advertising.Graphic 2.Operators analyzed1. AT&T - Unites States of America2. China Mobile - China3. France Telecom4. América Móvil Latin America5. Telefónica 5.1. Telefónica Spain 5.2. Telefónica Ireland 5.3. Telefónica Latin America6. Vodafone 6.1. Vodafone United Kingdom 6.2. Vodafone Germany 6.3. Vodafone India7. NTT Docomo Japan8. SKTelecom Korea |6|

MAVAM | 1. Introduction Variation in the revenues obtained from the Voice Services vs. VAS The mobile voice business faces a generalized downward trend (See graphic 3). In this sample of countries, which is varied as to geography and typology, there have been up to 12%yearly falls, except for such countries as China (+ 6%) and India (+21). These countries are undergoing pure expansion processes, with a mobile phone penetration rate below the global mean (77 %) and with 3G technology which is just taking off. In the particular case of China, with almost 860 million mobile subscribers by the end of 2010, only 25 million (3%) use 3G technology services and Vodafone India, with 124 million mobile customers aims at launching mobile broadband services through 3G technology on the January-March quarter of 2011. There are currently almost no 3G services in India. Graphic 3.Variation in the revenues obtained from Voice Services vs. VASDecember 2009 vs. December 2010 Source: Convergencia Research on the basis of the financial reports of the operators. In the particular case of the VAS business, there is a general 2-digit increase, highlighting Telefónica Latinoamérica (Telefónica Latin America) (+ 43%), Vodafone India (59%), and América Móvil (40,4%). It may be further observed that the gap –between countries with higher and lower economic development– in VAS use and market penetration ratios is increasingly reduced as less developed countries introduce more customers and as the counties with more developed economies enter a phase of solely vegetative growth. |7|

MAVAM | 1. Introduction The countries with lowest mobile phone penetration rates are undergoing a natural evolution stage, which has already been undergone by those countries with higher penetration rates. This evolution path ranges from those VAS mainly based on SMS (a feature which is operational on almost all the telephones) to those VAS based on mobile Internet (in developed countries with more sophisticated devices). Not only is the annual growth of mobile VAS important in absolute values, but its increasing contribution to the mobile ARPU is also relevant. On many occasions, not only does it compensate the losses in the voice business but it also makes it possible to increase the total ARPU. A good example of such situation is Telefónica Latinoamérica, where in spite of a 6%-yearly fall in the voice business as a consequence of the increase in the use of VAS, the total ARPU has also been increased by almost 2% (-0,2% in constant currency). Considering the development of more mature countries such as the United States, Germany, and the United Kingdom, this contribution figure exceeds 35% with a clear upward trend. In particular, in Japan the revenues obtained from voice services have just been put in the same level with the revenues from VAS. Graphic 4. Analysis of VAS contribution to the mobile ARPU December 2010 Source: Convergencia Research on the basis of operators’ balance sheets |8|

MAVAM | 1. IntroductionGraphic 5.ARPU fluctuation: Total vs. Voice. vs. Service Penetration and DataDecember 2009 vs. December 2010Source: Convergencia Research on thebasis of the operators’ balance sheets,local regulators and InternationalTelecommunication Union (ITU). |9|

MAVAM | 1. Introduction 1.2. Value Added Services in Latin America By the end of 2010, the nucleus of mobile subscribers in Latin America consisted of 83% prepaid and 17% postpaid. The high prepayment level has not constituted a restriction on the growth of revenues for value added services (VAS), which represent between 15% and 25% of the operators’ revenues, and may even reach values between 35% and 40% in some cases.Graphic 6. By the end of December, the average ARPU in the region was closet to USD 11,28. TheVAS by component ARPU values in Dollars have remained almost unaltered over the last three years as aAverage Total Region 2010 result of a combination of effects which are related both by the value proposals and by the ARPU’s own increases in local currency, depending on the operator’s country. In most cases, except in the case of Brazil, the main value added component is the one generated by SMS. Graphic 7. ARPU Voice vs. Data in Latin America per countrySource: Estimations Convergencia Source: Convergencia ResearchResearch | 10 |

MAVAM | 1. Introduction 1.3. Value Added Services (VAS) in Argentina Argentina is one of the countries with highest mobile service penetration levels. By the end of 2010, there were 52,256,7506 cell phone lines, equivalent to 130% of penetration on the population. Mobile clients increased 7% between 2009 and 2010. Although there are different points of views and estimates as to the number of lines related to a single user (does not have more than one cell phone line) or active user (consumes voice minutes), the fact is that regardless of the estimate made, percentages show that penetration has reached a saturation point as to connecting people. In 2010, sales increased 20.5% and amounted to 28,696 million Argentine pesos (almost) USD 7,192 million, equivalent to 9% of the Latin-American mobile services market. Market share per number of lines Market share per total sales Graphic 8. Market share 2010Source: Convergencia Research based on balances and own estimates. Argentina is the third Latin American market in number of subscribers, after Brazil and Mexico. However, regardless of this feature there are other factors that make it special. One of them is that post-paid users represent 27% of the market, while the Latin American average barely exceeds 17%. This is due to the fact that “controlled accounts” cover part of6 Estimates of subscribers and percentage of the market (controlled accounts refer to fixed rate agreements and recharging options) which prepaid users against post-paid users are not usually seen in the countries of the region. “Controlled accounts” are an interesting include Nextel. basis when offering packages and value added services. | 11 |

MAVAM | 1. IntroductionGraphic 9. However, the most particular feature inPrepaid vs. Post-paid Argentina is that it is the country thatTotal market 2010 mostly contributes with VAS (value addedSource: Convergencia Research based on services – SVA7) to the operators’ totalbalances and own estimates sales. In 2010, value added services represented 36.88% of the market, equivalent to a sales volume of almost 9,445 million Argentine pesos (USD 2,369million). The increase in value added services sales in relation to 2009 was nearly 40% while voice mail services increased 13%. SMS segment represents 68% of value added services. However, data segment is the segment that mostly increased, almost 50% annually. VAS vs. Voice VAS per type Graphic 10. Argentina: VAS 2010 Source: Convergencia Research. Only includes Claro, Movistar and Personal7 Followed by Venezuela with 33% of VAS contributions to mobile operators’ total sales. | 12 |

MAVAM | 2. MAVAM (Acision Monitor for Mobile VAS) 2 MAVAM (Acision Monitor for Mobile VAS) MAVAM aims at analyzing the trends of value-added services in Latin America. Since 2009, this study has been carried out in Brazil. In 2010, it was carried out in Mexico, while, in 2011, the survey will focus on Argentina. With the launch of Acision MAVAM Argentina, conducted by Convergencia Research, every six months the mobile market will be provided with a tool that allows monitoring the development of value added services within the country. The services analyzed in this edition include: • Messages • SMS • MMS • E-mail • Instant messages • Voice mail • Entertainment • Music • Images • Games • Ringtones • TV • Video • Internet access • Social networking • Location Based Services (LBS) • Payments and banking • Mobile Marketing MAVAM Argentina was carried out through a survey addressed to mobile phone users within Argentina, through Computer Assisted Web Interviewing (CAWI) with a sample of 800 respondents from Februarty 28th through March 18, 2011. The methodological bias in Internet surveys turns some cases inapplicable to the whole market and thus they can only be used as reference and guidance. These cases are explained along this study. | 13 |

MAVAM | 3. MAVAM Argentina 3 MAVAM Argentina 3.1. Message services Message services, particularly SMS, are the mostly used value-added services. However, the adoption level at Latin American countries differs from one country to another. Differences are generally explained by cultural and offer aspects. For instance, the ratio between SMS relative costs and voice mail costs per minute. Graphic 11. World: SMS averageper month by user 2010 Graphic 12. Latin America: SMS per month by user 2010 Source: Convergencia Research based on regulators. * Mexico: Two sources. Cofetel (regulator) 58 SMS per month. Other market sources estimate the number in 138 SMS. These estimation differences usually occur in most Latin American countries data due to the use of non-standardized methods. **Argentina: 126 SMS per day, based on data from Indec-CNC. 270 SMS per day, MAVAM data for active users. | 14 |

MAVAM | 3. MAVAM Argentina Graphic 13. SMS sent per month by user Selected countries 2010 According to the Argentine Communications Regulatory Board (CNC for its initials in Spanish), in 2010, there was a 19.2% increase in the SMS sent, thus amounting to 75,669 million of short messages sent. This means that, in average, during 2010, 126 messages were sent per subscriber. | 15 |

MAVAM | 3. MAVAM Argentina 3.1.1. SMS This MAVAM edition shows that 97% of users have used SMS in the last three months. This percentage shows that the use of SMS in Argentina is as popular as the use of voice mail and the SMS business growth will be encouraged by the increase in use and in applications among people and devices using short messages to communicate. Graphic 14. Use of SMS For this sample, 270 SMS are sent in average per month; it mostly duplicates the market´s average. The reason for this estimate is that users are usually familiar with technology. These percentages are interesting as reference data as they show the extent to which the use of SMS can be stimulated among current mobile subscribers. 33% of respondents cannot determine how much they pay for SMS. In average, within this sample, users spend $38 per month in SMS. | 16 |

MAVAM | 3. MAVAM Argentina 3.1.2. MMS It can be noted, that at a worldwide level, a broad number of cell phones, considered basic phones, can send MMS (multimedia messaging) and many of them also have cameras (which can be considered a logical element to exchange pictures through cell phones). However, this service is not widely used. Today, the development of sophisticated devices and the increase in social networking is changing the way users share pictures. In general, pictures (or other images related to people´s privacy) are not sent from one person to another; but from one person to many others. Users tend to “upload” or “publish” them in the social networks they are registered in. 72% of respondents said that their cell phones allow them to send MMS8. However, only 16.3% of respondents have used MMS in the last three months. If we consider active people those who send more than one MMS per week, we can conclude that only 7% of respondents have adopted MMS as a habit in their cell phones. Graphic 15. Use of MMS Reference percentages. Applicable to this sample only. Not applicable to the whole market.8 Probably, the number of cell phones that It is worth mentioning that, as the survey is made on the Internet, those much more allow sending MMS is greater, but it is sophisticated uses, unlike SMS, are affected due to the user´s familiarity with technology. interesting to consider that only 72% of Therefore, these percentages are used as reference or guidelines. The whole market may users are aware of it. not act alike, but they are considered a guide to adoption and development levels. | 17 |

MAVAM | 3. MAVAM Argentina The difference among the types of cell phones including MMS and their use means that there is a margin of growth within this service if interested offers are found and if the service is not left behind by other picture exchange methods, like the abovementioned social networks. 3.1.3. Instant Messages (IM) Graphic 16. According to this sample, 11% of Used mobile Instant respondents have used instant messaging in Messaging in the last the last three months. In average, they use three months Instant Messages 19 times a month. 3.1.4. Voice mail 48% of respondents use voice mail. In average, respondents use voice mail 9 times a month and its frequency is focused on an occasional use (38%). The remaining percentage is evenly distributed among daily, weekly and fortnightly use of voice mail. It is worth mentioning that due to the fact that users are most familiar with technology, the relatively low use of this service may show replacement effects that may be a sign that the voice mail is turning obsolete. Some of the replacement effects include, not listening to the voice mail and answering it by text messaging, not listening to the voice mail and answering the call because the user has caller ID, not listening to the voice mail to avoid expending on the service and waiting until the person calls again. | 18 |

MAVAM | 3. MAVAM Argentina Graphic 17. Use of Voice mail Basis: 48% of the respondents 3.1.5. E-mail 57% of respondents said that they have a cell phone allowing the setup of an email account and 19% thereof have Push mail in their phones, regardless of their use or not. Percentages are somehow high and should not be considered valid at the country´s level as the users surveyed are familiar with technology. 14% of respondents confirmed that they have set up an email account in their cell phones. However, if we consider only those who use email on a daily basis or use it several times a week, the percentage is reduced to 9.1% of respondents. Today, this adjustment is the best e-mail market estimator. As regards Push mail, those who have set up this option and used it in the last three months (5.75% of respondents), use the service on a daily basis. | 19 |

MAVAM | 3. MAVAM Argentina Graphic 18. E-mail in cell phones: Devices and use Active user: Used e-mail in the last three months and have used it daily or several times a week 3.2. Entertainment Mobile entertainment can be divided into two large groups; one where entertainment is available through preloaded games, radio or MP3, and the other, where entertainment is available through the download of ringtones, video, images and music. Except for ringtones and for the use of games in the cell phone, it should be noted that this MAVAM´s edition, the data of which was collected through Internet, represents a group of users particularly familiar with technology (advanced users). This highly affects the adoption of value-added services in relation to the whole market and should be taken as reference and should only represent a group of inhabitants using cell phones and having access to the Internet. As regards downloads for entertainment, images and pictures (21%) and music (14%) have been largely downloaded in the last three months. However, it should be noted, that there is no detail on whether these downloads were made through mobile network or through device data exchange (Bluetooth or computer phones). | 20 |

MAVAM | 3. MAVAM Argentina As regards ringtones, music and images and games, download percentages are extremely reduced if active users are considered; that is to say, those who download them on a daily basis, several times a week or once a week. As regards videos, the gap between active users and frequent users is narrower; but the basis is very small (less than 50 cases). Figures show that within the entertainment market there is space to grow in terms of penetration (a larger number of users) and use. Graphic 19. Entertainment-related downloads in the last three months It is necessary to understand that within advanced users, entertainment-related downloads focus on free content. Therefore, operators may find data service prices more important than the contents price. The contents which users are more open to are paid games (38% made paid downloads) and ringtones (37% made paid downloads). | 21 |

MAVAM | 3. MAVAM Argentina Graphic 20. Entertainment: Type of download Although the percentage of users who pay for downloads is very low, this sample shows that the suggested prices (charged9) amount to $4 per download. Music Ringtones Games Video ImagesAverage Price per download $AR 4 $AR 4 $AR 7 $AR 5 $AR 4 3.2.1. Games (Use and downloads) 88% of respondents have cell phones with preloaded games. However, only 76% of such users use them (equivalent to 67% of9 It should be noted that users answer based on the total number of the Price charged, that is to say, what they respondents). think they have paid and there is generally a distortion from actual content prices. | 22 |

MAVAM | 3. MAVAM Argentina Graphic 21. Preloaded games In average, respondents use preloaded games 13 times a month. But it is worth mentioning that 44% are frequent or active users of preloaded games (they use them on a daily basis and between 2 and 3 times a week), while only 23% occasionally use them. Graphic 22. Frequency of use of preloaded games in cell phones (Basis: who use preloaded games in cell phones - 76%) Users who downloaded games (13%) use them more frequently than those who use preloaded games. In average, they use downloaded games 16 times per month. 38% of respondents have paid for downloads; their average price is $AR 7. | 23 |

MAVAM | 3. MAVAM Argentina 3.2.2. Music (Use and Downloads) Almost 64% of the respondents’ cell phones feature the possibility to either use the radio or use the MP3. Generally, almost 100% of respondents having a device that allow them to listen to music through their cell phones actually use this feature. Graphic 23. Cell phones with radio and/or MP3 50% of respondents listening to music through their cell phone do so on a daily basis. Should we add those who listen to music 2 to 3 times a week, we can assert that cell phones are the favorite devices for such purpose. This habit is an active habit among mobile users. Graphic 24. Frequency of use of music in cell phones Basis: Those having cell phones with radio or MP3 and answered they listen to music. (64% of users) 14% of users downloaded music in the last three months. 78% of downloads were for free. Respondents download music 9 times per month in average. | 24 |

MAVAM | 3. MAVAM Argentina The frequency of downloads is divided between those who rarely make downloads (40%) and those who actively do it (daily, weekly or several times a week) and they represent 44% of respondents who have downloaded music in the last three months. Graphic 25. Frequency of music downloads Basis: 14% of the sample. 3.2.3. Ringtones (Downloads) 9% of respondents downloaded ringtones in the last three months. Generally, downloads are rarely made (monthly, occasionally in 69% of cases). In average, ringtones are downloaded 5 times per month, and 63% of downloads are free. 3.2.4. Images (Downloads) 21% of respondents have downloaded images in the last three months. However, those who frequently download images (on a daily or weekly basis or several days per week) only represent 5% of respondents. 88% of downloads are for free. Those who have paid to download images spend $AR 4 in average per downloaded image. | 25 |

MAVAM | 3. MAVAM Argentina 3.2.5. Video (Downloads) and Mobile TV (watching) In average, 6% of respondents have downloaded images in the last three months. Frequency of downloads is high (on a daily or weekly basis or several days per week). 90% of downloads are for free. The number of respondents who have watched mobile TV is significantly low (less than 1%). 3.3. Mobile Internet Within this sample, 59% of respondents have a cell phone whereby they can access the Internet, regardless of their actual use or not. They were asked which network they used. 78% of respondents use the mobile operator´s network, 7% of them only use Wi-Fi and 15% both. Graphic 26. Mobile Internet Access | 26 |

MAVAM | 3. MAVAM Argentina Although users know the different connection methods that can be used to access the Internet through a cell phone, only 19% of respondents have used their cell phone for Internet. This percentage (19%) is too high to consider it valid for more than 52million existing lines in Argentina. However it is a good mobile Internet adoption level gauge for advanced users (use fixed internet and have mobile phones). 19% of respondents having access to the Internet through their cell phones think that a browser (78%) and Wireless Application Protocol (WAP) (33%) are most commonly used. If we only consider those who access the Internet on a daily basis or several times a week, we can conclude that 14% of respondents are mobile Internet active users. This survey, carried out among Internet users having cell phones, is important due to the fact that it shows that the use of mobile services is affected by the use of Internet through a computer. Use of Internet requires a higher level of knowledge in relation to other services, such as SMS. That is to say, there is a chance to increase the use of mobile Internet and in general, this will bring benefits if the use of fixed internet is also increased. Graphic 27. Mobile Internet: devices and use 59% of mobile internet users in the last three months asserted they have hired a data plan. | 27 |

MAVAM | 3. MAVAM Argentina 3.3.1. Social Networking 15% de of respondents accessed a social network in the last three months. The mostly used social networks include Facebook (98%) and Twitter (31%). In average, for this sample, respondents access social networks 19 times per month. As regards both Facebook and Twitter, 74% of users access those networks on a daily basis.Graphic 28.Cell phone socialnetwork accessAnswer: multiple choice.Basis: 15% of the respondentshaving access to social networks | 28 |

MAVAM | 3. MAVAM Argentina 3.3.2. Mobile Money and Mobile banking The number of existing cell phones and the low levels of banking services in regions such as Latin America are interesting for the development of mobile banking and/or mobile services as monetary distribution channels. In this MAVAM´s edition we focused on two aspects: mobile banking only accessed by banked population and the use of cell phones to transfer credit to subscribers. The results show that 5% of respondents accessed a bank through their cell phones and made payments, while 15% thereof, transferred credit from one cell phone to another.Graphic 29. SUse of money andmobile banking It should be noted that online banking (bank web sites that can be accessed by cell phone) is widespread in Argentina. Many market studies show that inquiries are made by cell phones rather than by the banks´ web sites. | 29 |

MAVAM | 3. MAVAM Argentina However, the use of cell phones as a means of payment has not been widely developed in Argentina. To sum up, there is a chance to develop mobile banking and mobile money business lines. 3.3.3. GPS and Maps 7.1% of respondents have used GPS and/or maps through their cell phones in the last three months. The figure is too high to consider it valid for all mobile users in Argentina. Therefore, this information is taken as a reference and is applicable to those users who have cell phones but who also use Internet through desktop computers. 3.3.4. Mobile Marketing and advertising Mobile marketing and advertising comprise a broad and wide cross group of practices that ranges from banners in the operator´s web site, to advertising SMS and most sophisticated options involving users´ interaction. To organize this group, MAVAM classifies practices in two large groups: Mobile marketing, referring to advertisements made by operators, and Mobile Advertising, referring to advertisements made by companies other than operators. This MAVAM edition assesses the practices related to the use of messaging for advertising or promotion. 89% of respondents declared that they have received an SMS or MMS with promotions or advertising in the last three months. | 30 |

MAVAM | 3. MAVAM Argentina Generally, for this sample, users highly receive advertisements or Graphic 30. promotions in their cell phones. Received advertising 33% receives advertisements and or promotion in their promotions in their cell phones cell phones in the last between 2 and 3 times a week. In three months average, respondents receive 13 advertising messages per month. 14% of respondents do not remember the advertising issuing party, while 74% state that they receive messages from their operator (mobile marketing). 12% haveGraphic31. received messages from companiesFrequency of advertising SMS/MMS in cell phones other than their operators (mobile advertising). | 31 |

MAVAM | 3. MAVAM ArgentinaGraphic 32.Mobile advertising issuing party 62% of users declared they carefully read the messages received in their cell phones, while 38% do not. We consider that these percentages can be enhanced by accurately focusing on the users segment, the sending of messages and their consent to receiving advertising messages. For your information, MAVAM Brazil´s seventh edition deeply analyzed mobile marketing and advertising in the country. Segmentation based on preferences and the users’ consent were considered significant to enhance message receptivity. Although conduct is affected by cultural aspects, MAVAM Brazil data can be used Graphic 33. as a reference as to the significance of Were advertising segmentation and the users’ consent to messages carefully extend mobile marketing read? and advertising business. Among those who have carefully read advertisements, many declare that the messages belong to the operator and consist of discounts in services and/ or recharges mostly related to SMS or data packages. The mostly mentioned second item refers to contests to win money or prize draws of vehicles. Finally, messages may include discounts at stores and operator´s loyalty programs. | 32 |

MAVAM | 4. Conclusions 4 Conclusions Argentina is the Latin American country with the highest percentage in VAS contribution to the operators’ total sales. In 2010, they represented 36.88% of mobile phone companies’ annual sales. Value added services increased 40% in 2010 in relation to the previous year and sales amounted to almost $AR 9,445 million, while voice mail services only increased 13%. The increase rates show the importance of VAS in the operator’s current business. SMS represent the highest VAS earnings (72% of the total VAS). However, data services’ segment is the one that mostly increased in 2010, almost 50%, mainly encouraged by Smartphones. In Argentina, in average, 126 SMS are sent per month. The figure exceeds the world average (101 SMS per month). 97% of respondents to Acison MAVAM´s survey used SMS in the last three months. Respondents send 270 SMS per month in average. These users are familiar with technology, which has a positive impact on service consumption. In Argentina, the high penetration of post- paid services (27% against 17% in Latin America), SMS mass adoption and Smartphones proliferation have given place to a more sophisticated offering and a higher mobile service packaging as opposed to what happens in other Latin American countries. | 33 |

MAVAM | 5. Technical Data Sheet 5 Technical Data Sheet Universe Cell phone users with Internet access Technique CAWI (Computer Assisted Web Interviewing) Instrumento Pre designed survey 15 minutes Sample 800 respondents Country Argentina Date of survey February 28 through March, 2011 Gender Sample Men 389 48.63% Women 411 51.38% Age Muestra 14 - 24 156 19.50% 25 - 34 284 35.50% 35 - 44 188 23.50% 45 - 54 129 16.13% 55 + 43 5..38% Place of residence Sample MABA 392 49.00% Provinces 408 51.00% SEL Sample D1 230 28.75% C3 306 38.25% C2 188 23.50% ABC1 76 9.50% | 34 |

MAVAM | 6. Glossary 6 Glossary The description of the services presented in this report is presented in the following sections.Messages The services in this category can be defined as: SMS (Short Message Services): sends short text messages. MMS (Multimedia Message Service): sends short text messages with image, photo, or video. E-mail: receives or sends emails via cell phone. Receiving or sending can be done manually, in other words by user’s initiative, or can be activated through the push mechanism, which periodically and automatically receives and sends mail. Instant Messages: service which permits access to instant messaging systems like MSN or Yahoo. Answering Machine or Voice Messaging: gives access to the automatic messages recording service offered by the carrier, in case of receiving calls that can’t be answered.Entertainment The services in this category can be defined as: Music: service which provides the download of songs to be played in the cell phone. The handset must be able to play several music formats such as MP3, AAC, MP4, WAV, among others. Ringtones: service which provides the download of ringtones to be used in the handset. The cell phone must be able to play multiple formats of ringtones, such as MIDI, AAC, MP3, MP4, WAV, among others. Images: service which provides the download of images and photos to be displayed on the cell phone. The handset must be able to display several formats of pictures and images such as JPEG, GIF, among others. Games: service which provides the download of games to be played on the cell phone, individually, or through internet or Bluetooth connections, in groups. The cell phone must be able to run the games available in the device and also the downloaded ones, and additionally provide Bluetooth or data connectivity for internet access (eg.: EDGE, EVDO, or 3G). | 35 |

MAVAM | 6. Glosario Video: service which provides the download of videos or video streaming to be played on cell phone. The handset must be able to play downloaded videos or received video streaming. The cell phone must be able to play videos in 3GP, MP4, WMV, AVI, among others. Open TV: This feature is present in some cell phones and permits user to watch free TV programs with the handset acting as an analogue or digital TV receptor and capturing contents through the same signals (frequencies) received by traditional TV’s at home.Internet and Location The services in this category can be defined as: Internet Access: service which provides broadband access to the Internet via cell phone or modem. In both cases users must have a data plan contract with the mobile operator. This service has the following characteristics: Cell phone: the internet access from cell phone can be done in the following ways: • Using a browser to access the same websites accessed by fixed internet through a computer. Examples of browsers: the ones offered by the cell phone or smartphone (Internet Explorer Mobile, for Windows Mobile), or alternative browsers such as Skyfire or Opera. • Accessing the WAP websites inside the Carrier network through WAP browser. • Through specific programs installed in the handset (Widget, Web-App) provided by companies like Yahoo Mobile. Modem: devices which can be connected to desktop computers or notebooks. Provides Internet broadband connection using a computer browser (Internet Explorer, Firefox, and others). Social Networks: service which includes all the necessary elements to provide access to social networks such as Orkut, Twitter, Facebook, and others. This access can be done through browser and internet access, both present on cell phones, or through a specific application provided by mobile operators or other companies. Payments and Banking: usually offered by banks or other credit institutions, which allows the access to users accounts in these institutions. These services can range from simple balance consults to the payment of bills or conclusion of investment transactions. | 36 |

MAVAM | 6. Glosario Location Based Services: service which provides users’ geographic location. These services have the following characteristics: Location can be provided as the following: • Through a process of triangulation using information from cell sites and application systems provided by the operator for this purpose; • Through the GPS installed in the cell phone. Offered Services: Location: service usually offered by the mobile operator which allows informing the geographic location of a particular subscriber. Eg.: service hired by parents to monitor their children’s habits, or with the purpose of promoting safety. Maps: service offered by other companies providing maps on cell phones, usually to locate addresses, and also permits to locate users in the map if their handsets have a built-in GPS. Contextual Filter: permits the mobile operator, or other service providers, to offer addresses or other types of promotions at stores, restaurants, movies, among others, based on the instant location of users.Mobile Marketing The services in this category can be defined as: Mobile Marketing: these services are implemented by mobile operators, to advertise the operator itself or other companies for the subscriber base. Usually these ads are sent via SMS. The advertisements can also be sent directly by competitor carriers or other companies, again using SMS messages. Mobile Advertising: similar to Mobile Marketing, Mobile Advertising is also an advertising service implemented by mobile operators or other companies. If the subscribers agree to receive it they can participate of promotions such as free minutes, free SMS packages, and others, as a reward for receiving advertisements. | 37 |

MAVAM Argentina - English version 04/04/2011

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