Khawla Al Jaber, Broadband Business Advisor at the Zain Group discusses the possibility of service provider competition in the communications sector in Middle East and North Africa

1. Broadband Opportunities and Challenges
May,5th 2009

2. Agenda
1. Broadband opportunity
2. Operator SWOT
3. Make the right choice
4. Industry vs. Regulatory evolution
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3. How to turn Broadband opportunity into reality?
What is Broadband ? Facts about Broadband
 It is a matter of usage: Internet and
freedom
 It is a matter of end-device: PC
Broadband is clearly set apart from
Mobile data
 It is a matter of speed: high speed
Broadband starts at a speed considered
by the customer as a high speed for him
Don’t miss Broadband market and make the most of it
Act now! Hit the target! Make the right choice!
 Assess the threat from  There are 2 distinct Value  There is no unique answer to
competition to decide how fast Propositions: 3G versus Wimax debate
to move in each country  Shared usage at Home/Office  Acquiring an ISP actor with
 Nomadic Broadband used fixed assets can be a good
anywhere and personal alternative
 Define the strategic objectives
 The untapped segments offer
pursued with Broadband  Comprehensive B-Case to
 Aggressive strategy to grasp the
substantial revenues but support a cost-wise investment
boom of the market or defensive, requires tailored services
 High shared B/W
 SLA

4. Mobile operators assets vs. BB as a specific business
Strengths Weaknesses
 Large customer base  Network upgrade and coverage
reinforcement required to offer
 Perceived as more dynamic and Broadband introduces disruption
broadband
reliable
 Mainly prepaid customers not  Broadband should be considered
 Developed synergies with mobile as brand new activity by a mobile
always appropriate for broadband
activity (procurement, network, operator, raising challenges
service
staff…)
 Relationship with individuals, as  New customers: Family vs
 Natural association between mobile Individuals
opposed to household
brand and home environment
(as mobile phone is already used at  New B-model different from
home) voice
 New technology or at least new
 Complete telecom portfolio  Regulation more likely to favour network dimensioning
mobile competition than broadband
 Make profit from broadband  New skills
up-take in the short term
revenues with a know-how on
telecom economics  Competitiveness and  New Business Unit to articulate
sustainability versus fixed with Mobile one
 Capitalize on mobile assets:
offerings such as DSL, fiber, FWA
distribution, brand, customer care…  New priority with potential
 Presence of integrated operators arbitrations: roadmap, ATL,
 Develop cross-sales and loyalty sales force management…
and potential new entrant players
programs
on the market
Opportunities Threats

5. Make the right choice! among available technology
options to take up Broadband challenges
Technology
Market drivers Technical implications differentiator
Broadband
challenges
With increasing usage, customers Every network component has to be
look for high allowances properly dimensioned Cost structure
Unlimited
ability to support
offers Unlimited offers are the ultimate Radio, backhaul, backbone and heavy data traffic
proposition in mature markets International bandwidth
The choice has to be future proof to
Customers buy higher and higher stay in the competition Maximal speed
Race for speeds per user, actually
With possible up-grade (e.g.3G/LTE)
speed Even if they don’t really perceive available &
the extra-benefits Versus disruptive scenarios (e.g. advertised
fiber up-take)
Some technologies (Wimax)
SME segment requires SLA and
integrate the SLA feature, other SLA feature
Bandwidth high QoS
don’t (3G) to address SME
guarantee Without these guarantees, B2B
In addition, SLA encompasses a segment
market potential is restricted
network end-to-end commitment

6. Make the right choice! and achieve the optimum ROI through
an in-depth Business-Case
Competitive landscape Market potential Technology options
Offer Price
Leader
Player C
Player B
Price point 1
2G (or EDGE)
Challenger
Price point 2
3G license owned
Player A
Number of 3G or WiMAX
customers
WiMAX in deployment
Mobile Convergent Fixed
 Level of threat?  Size of the addressable base?  Zain assets?
 Competitors potential moves?  Which segments to target?  License availability?
 Zain targeted position?  Potential market share?  Possible partners or acquisitions?
 Which offerings on the market?  Expected ARPU?  Zain skills/capabilities?
A comprehensible B-Case will define the optimal target/offer/techno scenario
 Technology choices and investments are driven by marketing requirements
 Offering needed features depend on the customers expectations
 Targeted segments vary in relation with Zain ambitioned position on the market versus competition

7. Industry Development vs. Regulatory Evolution
•In general (not just in MENA), regulation lags significantly
behind industry developments
• Regulation is fragmented and compartmentalized; rarely
converged or integrated
• The number of converged regulators is still very limited
•Convergence is dismantling boundaries and challenging
regulators

8. Khawla Al-Jaber
Strategy and Support Director
Group Networks
Khawla.aljaber@zain.com
Thank you
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