The 'Orange Start Up Programme' - delivering 'Corporate Open Innovation'

Slide 1: The ‘Orange Start-Up Programme’ (OSUP) The ‘Orange Start Up Programme’ (OSUP) delivering ‘Corporate Open Innovation’ part of www.orangepartner.com Martin Duval – Director of the O SUP

Slide 2: The ‘Open Innovation’ culture and approach  ‘…Open innovation means that valuable ideas can come from inside or outside the company and can go to market from inside or outside the company as well. This approach places external ideas and external paths to market on the same level of importance as that reserved for internal ideas and paths to market during the Closed Innovation era.’ ( Book ‘Open Innovation’, 2003, Henry Chesbrough, Harvard Business School Press)  ‘The smartest people always work for someone else’ ( Bill Joy, co-founder of Sun Microsystems,1990) 2

Slide 3: The ‘Orange Start Up Programme’(OSUP) mission  Deliver and implement a ‘Corporate Open Innovation’ programme :  By building a sustainable business and technological ecosystem around Orange and its platforms  Through the development of relationships and partnerships with Start-Up companies and Venture Capital funds (Worldwide)  Creating and launching innovative services/products/enablers and disruptive business models  Mostly in the area of Mobile/Web 2.0 (communities, social networking, user generated content), social media, audience, advertising & entertainment related services (video, TV, music, games),  Based on convergence (mobile, IPTV, web, content) 3

Slide 4: A unique ‘partnership platform’ delivering ’Open Innovation’ Objectives: • A ‘partnership platform’ based on the ’Corporate Open Innovation’ philosophy • aiming at developing a dynamic and sustainable ecosystem around NExT.com, OAD and the greater Orange Group • through the creation of a “virtuous triangle” to generate speed and value to Orange - Provide new product /service or be part of How does it work ? a new « mash-up » or enabler -Share development and experiment of first launch & new business model Start-Up Customers FT-Orange VCs - Provide a first key pilot project /contract & - Provide funds to early-stage companies international development potential - Or support for partnership with FT-Orange -Support early-stage fund raising -if already in their portfolio - M&A opportunities 4

Slide 5: Close the Gap with external innovation Research Development Spin-Off Spin-Off Internal R&D Current Market New Markets and Business+ and Model Disruptive Business Models Technology acquisition External research Technolog projects from y in- Universities and Labs licensing Venture (Public or from other Technolog investing corporations) y from Current OSUP scope startups (NExT.com/OAD) 5

Slide 6: Process et deliverables (pipeline 2007) inputs Deliverables outputs 1 2 “On demand” Opportunity studies MoU sourcing of partners / enablers Bring value Challenging “Make or buy” Internal sourcing from : R&D, Next.com, I labs (> 30) (> 10) Develop a standalone project 3 4 from scratch Beta test project External sourcing from : Pilot contract management Web Sites, press BET releases, conferences… A Collaboration Build a label Contribution approach to improve Problems internal processes solving (purchasing, legal…) Final launch (> 4) Contribute to (> 200 (> 80 the ecosystem identified) contacted) development 6

Slide 7: Relying on a ‘Innovation Partnership Platform’ 6 layers of support, services and tools : Programme ROI tracking system Support layers as key succes factors Communication : internal and external (PR) LIPPnet : collaborative intranet/extranet 2.0 and video content based knowledge management Processes (MoU, monthly report,…) and organization (steering committee, interfaces with Purchasing, Legal,…), pipeline management Know how: to attract, select, deal with and support the startups and their management team for the projects take-off and management People & training : a team of 3/4 people to run the programme + training modules to deploy Open Innovation change (1-Open innovation, 2-Venture Project Management) 7

Slide 8: Best practises / lessons learnt  1) a specifically designed partnership contract/MoU which is co- signed with the purchasing department to create momentum and speed very early in the partnership process  2) no exclusivity nor IP issues dealt during a first 'opportunity phase' of collaboration, again to create extra pressure on the Corporate organization to deliver faster Time To Market and first mover advantage  3) no direct investment, but rather support the startups to help them raise funds with third party VCs thus contributing to the development of sustainable partners within the ecosystem as well as initiate extra opportunity flows from the VC community 8

Slide 9: The ‘Orange Start-Up Programme’ (OSUP) OSUP case studies

Slide 10: Case Study: mob-it  After reviewing numerous start-ups, mob-it was considered as unique with many specificities :  The ability to deliver a very efficient web-to-mobile experience  A generation on-the-fly of a widget app from a website, fully personalized  No pre-installation process, no configuration  Not another Widget universe, complex to understand for the users  Easy to transfer  A very simple idea : the mobile device, with its small screen, its presence in our pocket, is the natural « to go » extension of the web.  We are focusing at leveraging our services such as Pikeo  As mob-it allows the mobilization of websites, through an installed application on the phone  Pikeo could benefit from the technology to provide micro-albums 10

Slide 11: Processes and deliverables: in real life inputs Deliverables outputs 3,5 months 1 2 Opportunity studies MoU 6 mo nths public be ta test Start-up screening from = 7 months our 2.0 companies from meeting networks 3 4 To beta Beta test project Pilot contract management On your mobile BET A launch Q4 - 2007 3,5 months 11

Slide 12: Case Study: mob-it  a simple button on any album  a click on the album, a phone number...  a SMS is then received on the mobile phone with a wap link (wap push)  a click and the installation begins  the application automatically launches...  no prior installation or configuration  virality through the click of a button  (web to mobile + mobile to mobile) 12

Slide 13: Case Study: mob-it  OSUP MoU has been highly valuable for mob-it  New prestigious clients : Universal Music, Marathon Group (TV production company), Canal+  Mob-it has been selected by Eureka for a 900 K€ public funding  As the pilot is being launched, OSUP is now providing support to mob-it team  Communication on the product : Press Releases, Newsletters, Conferences and shows to present the company. As an example of the OSUP contribution, we invited to this conference the CEO, Jerome Chouraqui. (Feel free to share and meet with him)  Financial : the company is currently looking for 1 million €. OSUP is organizing meetings with VCs thus bringing credibility to the project.This conference is also an opportunity to meet VCs. 13

Slide 14: Case Study: Vringo  Vringo have developed a community video ringtone service relying on Web servers, scripts as well as mobile phone clients. It allows friends to configure the video ringtone which will play on their friends’ phone when they call.  Among other service providers (usually based on IMS), Vringo was considered unique :  Vringo’s architecture does not require any modification to operator telecom systems or mobile phones radio stack.  Vringo have developed an end-to-end synchronization solution between their servers and a wide range of mobile phones already (Symbian Series 60, Windows Mobile, Sony Ericsson (≥JP7), Nokia S40 (≥5th edition).  They have filed a number of patents which FT R&D have verified  Vringo can be seen as Personalisation 2.0 and its virality across mobile phones within a community of buddies could facilitate the roll-out of community services on mobile phones (MOC) as well as the uptake of the “Internet” options (“Internet Max” in France) 14

Slide 15: Processes and deliverables inputs Deliverables outputs 1 months 1 2 Opportunity studies MoU 5 Prepare launch with OFR Start-up screening from our 2.0 companies networks 3 4 Pilot contract Trial with Lab’O BET A trial Q2 - 2008 Jan 2008 Mar 2008 Jun 2008 Jul/Aug 2008 15

Slide 16: Orange & Vringo inputs & deliverables  Billing management  Service development  Data – flat fee  Mobile clients  UGC upload (if necessary)  Web site  Premium content  Mobile site  Content (local & international partners)  Content (international outside of  Free SMS routing to Orange France Telecom / Orange partners) customers to enable SMS wake-up  Interop with other operators (e.g.  Embedded clients signature (WM & Bouygues & SFR in France) J2ME) to enable SMS wake-up  Promotion of MOC & mobile Internet bundle in Vringo invitations  Devices selection to match user installed base  Promotion of the service within MOC Private alpha on : And looking further into an advertising http://orange.vringo.com model…  Advertising network  Call Data Records (required to determine which video played on whose phone) 16

Slide 17: Case Study: V4x  V4x is a company selling authoring tools for Mobile Interactive TV  The solution is designed to repurpose content for mobiles, allowing to add the interactive metadata on existing video content  Among other service providers, V4x was considered as unique :  V4x’s platform is a technology enabler that makes Mobile TV a compelling experience. Working with original content, “mixing” it best for the small screen, and distributing it through a range of channels, V4x are the company delivering real, “made-for-mobile” programmes.  They have a complete software suite in ASP mode, from creation of interactive metadata to publishing  Result?  Lead to a proof of concept of an end-to-end mobile TV factory : from creation of interactive metadata, the end-to-end delivery on a unicast network and the browsing / rendering of this interactive info on a specific mobile 17

Slide 18: Case Study : V4x  A repurposing tool for video on mobile, bundled with an interactivity editing tool  Interactivity information is added to the video stream, and displayed under the video picture  Interactivity allows :  click-to-call  click-to-wap  click-to-SMS  This will allow integration of voting, quizz, interactive ad banners into broadcast or unicast mobile TV Ex : voting for the next  This interactivity can be scheduled using a calendar clip or triggered manually during a live event on a music channel 18

Slide 19: The ‘Orange Start-Up Programme’ (OSUP) OSUP case studies with startups met during the previous Camp

Slide 20: Case Study: ClicMobile  ClicMobile was identified as a valuable proposition for Orange, enabling:  Innovative ideas around micro web 2.0 applications leveraging social networking data  Open API which allows bulk import of contacts into NExT.com products (Ubb of audience function between the various products )  First focus on Bubbletop  Result?  Development of a unique Orange application (Birthday Reminder & Wish List app) is nearly complete and subject to finalising commercials we will launch the product in Q2 2008 20

Slide 21: Processes and deliverables: in real life inputs Deliverables outputs 4 months 1 2 Opportunity studies MoU 6 mo nths public be ta test Start-up screening from = 6 months our 2.0 companies from meeting Birthday Reminder networks 3 4 To beta Beta test project Pilot contract management BET A launch Q2 - 2008 3,5 months 21

Slide 22: Case Study: ClicMobile Birthday Reminder My contact list to 0 1 configure alerts 2 kind of alerts : 0 e-mail and/or SMS 2 types of 1 friendship. For a good friend, I receive 2 birthday alerts, one week before and one day before 22

Slide 23: Case Study: NYN  Following an introduction at an Orange Partner Camp, NYN was identified as a potentially valuable proposition for Orange, enabling:  Orange to offer a choice of personal numbers to their customers based on personal preferences (names, birthdays etc)  A simple interface that can be incorporated either on local Orange websites or into a customer service interface in store  A new acquisition tool to convert new customers  A new revenue stream  Monetisation of an existing unexploited Orange asset (the mobile number pool) 23

Slide 24: Case Study: NYN Customer visits Orange Shop to New purchase new phone/upgrade. customer Offered option to pick a personal in-shop number for a one-off fee. Salesperson uses online tool to search number pool according to preferences of the customer (name, DOB etc) Algorithme Number Customer visits Orange online to Pool New purchase new phone/upgrade. customer Offered option to pick a personal online number for a one-off fee. Directed to online tool to search number pool according to preferences of Orange to the customer (name, DOB etc) provide the number Customer speaking to CS about Number Existing leaving Orange. Retention team possibilities customer offers customer ability to select a churning personal number for free 24

Slide 25: Case Study: NYN  OSUP has helped to get NYN by  Introducing the concept to the right people and the right projects within Orange  Identified trial opportunity in Moldova  Identifying other trial opportunities elsewhere around the Orange group  As a result of the trial, OSUP can offer NYN valuable material in the form of a case study of the Orange experience for NYNs own publicity 25

Slide 26: The ‘Orange Start-Up Programme’ (OSUP) thank you martin.duval@orange-ftgroup.com