Inwi is considering deploying an LTE network to take advantage of the growing LTE market. The document discusses LTE market trends, challenges facing Inwi, potential business models, and a conclusion. Key points include that LTE networks and devices are becoming more widespread and affordable, presenting an opportunity for Inwi, but competition in the Moroccan mobile market is also intense which could impact pricing. The document evaluates various business strategies like network migration approaches and pricing plans to help Inwi succeed with LTE.

1. Bring You to Broadband Era
- Business Plan -
Hassan KHAZANE
Wireless Solution Manager
hassan.khazane@zte.com.cn
16/01/2014

2. I. LTE Market Trend
II. Challenge & Chance for INWI
III. Business Model
IV. Conclusion
Agenda

3. I. LTE Market Trend
II. Challenge & Chance for INWI
III. Business Model
IV. Conclusion
Agenda

4. © ZTE Corporation. All rights reserved.
LTE Status Worldwide
209
130
48
17
2
LTE Commercial Network - Cumulative
 130 Commercial Network at December 2012
 33.5 Million Subscribers at November 2012
 GSA Forecast 209 Commercial Network by end 2013
LTE is the fastest deploying Mobile Communication System Technology Ever
Source: GSA

5. © ZTE Corporation. All rights reserved.
1800 MHz is the most widely used band for 4G/ LTE System Deployments Worldwide
 1800 MHz is used 38% of Commercially Launched Network
 130 User devices Announced Includes 26 Smartphone – All the Leading Brands
LTE FDD Deployments Worldwide:
Source: GSA
FDD
SpectrumBands
5
MHz
10
MHz
20
MHz
2.5/2.6GHz √ √ √
2.1GHz √ √
1.5,1.7,1.8,1.9GHz √ √
900MHz √
800/850MHz √
DD(700to800MHz) √ √

6. © ZTE Corporation. All rights reserved.
LTE TDD Investments Worldwide:
Commercial Networks
On Going
 11 Commercial LTE TDD Systems
 17 LTE TDD Commercial Networks Deployments On-going
 2.6 GHz is the most used frequency for LTE TDD
Source: GSA

7. © ZTE Corporation. All rights reserved.
LTE Ecosystem Status
Source: OVUM, GSA
ZTE LTE
Smart Phone
ZTE LTE
Smart Phone( 4 processor)
ZTE LTE 1800 Tablet V11L
ZTE LTE 1800 dongle
MF820 USB Modem
• LTE terminal:
• Data card: $50-60; LTE terminal:-50%(2012),2013 to reach an affordable
price($150-$200) to the public.
• HSPA+ terminal:
• Data card:$30-$50; HSPA+ terminal: $450
LTE Devices are becoming more Diversified and Affordable:

8. I. LTE Market Trend
II. Challenge & Chance for INWI
III. Business Model
IV. Conclusion
Agenda

9. © ZTE Corporation. All rights reserved.
Moroccan’s Mobile Market Evolution & Maturity:
Source : informa, 2012
Source : ANRT, September 2012
Source: Blycrotf Publishing, 2010
Morocco Operators
Evolution of Mobile Subscribers & Penetration Morocco Population &GDP per Capita (PPP)
Mobile Market Shares

10. © ZTE Corporation. All rights reserved.
Moroccan’s Mobile Data Market:
0.05%
Source : ANRT, September 2012
Internet Subscribers by Access Mode
18.42%
Source : ANRT, September 2012
Mobile Internet Market Shares
Source : ANRT, Annual Reports
Internet 3G Subscribers Evolution
Source : ANRT, Annual Reports
3G Internet Market Evolution
Source:
Pyramid Research
Source : informa, 2012
Operators Market Shares

11. © ZTE Corporation. All rights reserved.
•Price discount and
promotion greatly
improve MOU.
vs
•ARPU had fallen
Competition Cause High Investment and Price War
Price War Impact the ARPU:
16
32
48
80
120
(MAD)

12. © ZTE Corporation. All rights reserved.
 Larger gap between
mobile traffic and
wireless capacity, more
and more BS sites are
needed.
 Large gap between data
traffic and the ARPUCost
Desired
Cost
2011 2012 2013 2014 2015 2016
Voice 9.76 8.88 8.21 7.62 7.15 6.73
Data 4.49 4.56 4.57 4.58 4.62 4.67
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
Mobile ARPU Forecast
B USD
Mobile OPEX Forecast
Mobile data traffic is growing faster than revenues :
 More base station sites mean more TCO of the network
 Flat Revenue hard to cover the network cost

13. © ZTE Corporation. All rights reserved.
5 Keys to Win the Challenges
User-paid Revenues
2005-2010 2010-20202000-2005
TCO and Carbon Footprint
Broadband
Network
Applications
& Device
Traffic
Voice-centric
Pay per minute
Unlimited wireless triple play
New Value Chain
Voice and Multimedia
Pay per use
Walled garden
Non
User-paid
Revenues
Enriched
Service & QoE
New Pricing
Strategy

14. I. LTE Market Trend
II. Challenge & Chance for INWI
III. Business Model
IV. Conclusion
Agenda

15. © ZTE Corporation. All rights reserved.
Inwi’s future business is facing an extreme intense competition:
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
2012 2013 2014 2015 2016 2017
Subscriptions by Technology
W-CDMA GSM CDMA
ThousandThousandThousandThousandThousandThousandThousandThousandThousandThousandThousandThousandThousandThousandThousandThousand Operators Market Shares
 Inwi Should build a Competitive Network to be a head of Market
Broadband Network
Applications &
Device
Enriched Service & QoE
New Pricing Strategy

16. © ZTE Corporation. All rights reserved.
INWI in BCG Matrix INWI in GE Matrix
Attractiveness
Competitive Strength StrongWeak
High
Low
HighLow
High
Low
Market Share
GrowthRate
GSM
MB
INWI’s
Value
Market
Cash
cowdogs
question
marks stars
MB
Fixed
Telephony
Voice
‘Stars’ Service
 Expand scale, enhance competitiveness, GSM and
LTE will be.
‘Cash cow’ Service
 Maintain EVDO market advantage, prevent rivals’
encroachment, LTE launch to enhance it
‘Question Marks’ Service
 Right choose proofed, Actively increase GSM
investment
High ‘Attractiveness’ , Strong ‘Competitive Strength’
 Keep EVDO Advantage, Speed LTE launch
Mid ‘Attractiveness’ , Strong ‘Competitive Strength’
 Selectively invest resource, maintain competition
structure
High ‘Attractiveness’ , Weak ‘Competitive Strength’
 GSM direction proofed, Adopt active strategy,
Allocate enterprise resource in prior
Internet is the most valuable market
for INWI, GSM voice is right choice
and will be the basic for future
How to gain advantage?
Strategy Analysis
Broadband Network
Applications &
Device
Enriched Service & QoE
New Pricing Strategy

17. © ZTE Corporation. All rights reserved.
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
R99 HSDPA HSUPA HSPA HSPA+ LTE Trial LTE MIMO 2x2 LTE-A
802.16e Rel 1.0 802.16e Rel 1.5 802.16e Rel 1.5
LTE Trial
1xEV-DO Rev A 1xEV-DO Rev B 1xEV-DO Rev C UMB
3GPP
GSM
3GPP2
CDMA
IEEE
WiMAX
GSM
GSM
GSM H +
H +
1xDO
Rev A
HSDPA:
7.2 Mbps
HSDPA:
3.6 Mbps
1xEV-DO:
3.1 Mbps
BLR
Migration Scenario
 There are different migration scenarios based on Inwi’s frequency resources
Broadband Network
Applications &
Device
Enriched Service & QoE
New Pricing Strategy

18. © ZTE Corporation. All rights reserved.
 Smooth Upgrade and Subscriber Migration
Smooth Evolution:
TotalTraffic
Time
+ 1 EV- DO
+ 1 EV- DO
+ 1
EV-
CDMA Traffic
LTE Traffic
GSM Traffic
f1/f2
f1/f2
f1/f2
f1/f2
f1
f1
f1
f1
f1
f1
f1
f1
f1
f1
f1/f2
f1/f2
f1/f2
f1/f2
f1
f1
f1
f1
f1
f1
f1
f1
f1
f1
f1/f2
f1/f2
f1/f2
f1/f2
f1
f1
f1
f1
f1
f1
f1
f1
f1
f1
2013 - 2014 2014 - 2015 From 2015
Whole Network
GSM For Voice
Whole Network
EV-DO For Data
Important Cities
LTE For Data
Whole Network
LTE For Data
Whole Network
LTE-A :Voice +Data
Important cities
LTE-A :Voice +Data
Broadband Network
Applications &
Device
Enriched Service & QoE
New Pricing Strategy

19. © ZTE Corporation. All rights reserved.
Service Provider Example: CSL
Service Offering
• CSL Next G speed ranking in Global top 3
* (using Apple iPhone)
• LTE/DC-HSPA+ Brings it to the Next
Level*
eLearning Mobile 3D TV
HD Video
Conferencing
Cloud Computing Online Game
Smart Office Live 3D/HD Video
Streaming
Interactive Gaming
e-Health
Three brands - 1O1O, one2free and New World Mobility, have their own unique
positioning targeting to different market segments.
Broadband Network Applications &
DeviceEnriched Service & QoE
New Pricing Strategy

20. © ZTE Corporation. All rights reserved.
Service Offering
Everything as a Service
• Global Network, Managed and Communications Services
• Cloud, Security and Professional Services
• Open Development
• Service Delivery Platform
“It’s about a firefighter who can
download the design of a
burning building onto a
handheld device, a student
who can take classes with a
digital textbook, or a
patient who can have face-
to-face chats with her
doctor.” *
* U.S. President Barak Obama, State of the Union
Message, 25 January 2011
Service Provider Example: Verizon
Broadband Network Applications &
DeviceEnriched Service & QoE
New Pricing Strategy

21. © ZTE Corporation. All rights reserved.
P2P M2M, M2PP2M
eNB
MBMS
Service Categories
Particular
Enterprise
Ordinary
Premium
Broadband Network Applications &
DeviceEnriched Service & QoE
New Pricing Strategy

22. © ZTE Corporation. All rights reserved.
B2C Plan
Video Call
IPTV
10 20 30 40
Gaming
Voice CallVoD
Mobile Chat
Blogging
Social Networking
LBS
Emails
Media Sharing
Mobile Music
Volume
Broadband Network Applications &
DeviceEnriched Service & QoE
New Pricing Strategy
Multi-dimensional Business

23. © ZTE Corporation. All rights reserved.
 Signaling traffic increase due to higher penetration of Smartphone
 Massive applications requiring precise QoS policy
 Easier to achieve the objects with a controllable and smart
network
Mobile Data Pipeline Challenge
Broadband Network Applications &
Device
Enriched Service & QoE New Pricing Strategy

24. © ZTE Corporation. All rights reserved.
Control the Traffic Explosion with Customized Pricing Plan:
1.Market-skimming pricing is proposed for the
launch stage. The pricing is of following features:
•End user: high end business or family users
•Net profit rate : high
•User quantity: small
2. When the market becomes mature, unit price
drops and flexible pricings appear for different
segments.
3.Two pricing methods are proposed to Inwi’s LTE
service:
•Pricing by data transfer rates & graded SLAs
•Pricing by capped data allowance
The 2 pricing methods are usually combined to
form a whole pricing policy, targeting different
segments.
Pricing
features
Pricing by data
transfer rates &
graded SLAs
Pricing by
capped data
allowance
Target
Market
Middle or Low
end market
High end
market
Limits Limited of total
traffic and data
rate , usually less
fast
Capped data
allowance,
no other
limits
Source: Ovum
Others Pricing
Market-skimming
Pricing
Point of
Inflection
Maturity StageIntroduction Stage
Unite Price
Sales Volume
Pricing Strategy
Broadband Network Applications &
Device
Enriched Service & QoE New Pricing Strategy

25. © ZTE Corporation. All rights reserved.
Price Strategies
• Together with the fastest mobile broadband network in Hong Kong, the new service plans will allow
all mobile users to get the most out of their devices. one2free’s unique network provides
broadband speeds up to 1.7 times1 faster than competitors, as well as the widest outdoor and
indoor coverage in Hong Kong
Monthly Fee $187 (HK dollar) $287(HK dollar) $387(HK dollar)
Local Mobile
Data Usage++
1GB 5GB Unlimited
Thereafter
Charge
$99/GB(Thereafter Charge
Capped at $498/month)
WiFi Hotspot
Data Usage Unlimited*
Example of Pricing Strategy: CSL
Broadband Network Applications &
Device
Enriched Service & QoE New Pricing Strategy

26. © ZTE Corporation. All rights reserved.
The Verizon rewards customers that commit to long-term
contracts with discounted prices,
Price Strategies
• Price:USD50-80 per month. Additional charges applicable after first 10 GB.
Country Plan Detail Contract
Length
Monthly
Cost
(USD)
Data
Cap(GB)
Cost Per
GB
(USD)
Peak
Downlink(
Mbps)
US USD50 Plan Two USB
modems
available at
first launch.
Ten further
devices to
be added
by June
2011.
24
Months
50.00 5.00 10.00 12.00
US USD80 Plan 24
Months
80.00 10.00 8.00 12.00
Example of Pricing Strategy: Verizon
Broadband Network Applications &
Device
Enriched Service & QoE New Pricing Strategy

27. © ZTE Corporation. All rights reserved.
Broadband Network
Applications &
Device
Enriched Service & QoE
New Pricing Strategy
Good user experience
Low power
consumption
Long battery life
Diversified Devices Change User Habits

28. © ZTE Corporation. All rights reserved.
US$100
US$50
US$40
US$35
US$30
US$0
US$30
US$60
US$90
US$120
2011 2012 2013 2014 2015
LTE Terminal Price Forecast LTE CPE Price Forecast
Source: ZTE ResearchSource: ZTE Research
Biggest Obstacle of LTE Device Will Be Cleared Up:
For Premium ConsumersFor Largest Consumers
Samsung Galaxy S III
Samsung Galaxy Note II
ZTE Light Tab V70
ZTE LTE FDD+TDD uFiZTE LTE FDD+TDD CPE
ZTE LTE Smartphone
V9800
Broadband Network
Applications &
Device
Enriched Service & QoE
New Pricing Strategy

29. © ZTE Corporation. All rights reserved.
Feature of LTE on handset
 lower data rate, shorter online time, higher
revenue contribution
User Type
Monthly
revenue (RMB)
Monthly online
time (ERL)
Revenue per ERL
(RMB/ERL)
Data Card 19714482 6626311 2.98
Handset 3130943 297729 10.52
Enterprise 118713 393966 0.30
Total/Average 22964138 7318006 3.14
1 Euro ≈ 10 RMB
Handset users occupy the least network resource, contribute
the most revenue per ERL
More and more applications
transfer from PC to handset
 LTE on handset application could reduce traffic pressure and contribute more revenue
Develop Handset Applications:
Broadband Network
Applications &
Device
Enriched Service & QoE
New Pricing Strategy

30. I. LTE Market Trend
II. Challenge & Chance for INWI
III. Business Model
IV. Conclusion
Agenda

31. © ZTE Corporation. All rights reserved.
INWI is Ready to Embrace LTE :
Terminal Maturity:
Yes
• LTE devices are becoming more mature and
affordable.
Market Maturity:
Yes
• Morocco has a stable growth of population &
economy;
• GDP per capital (PPP) shows that LTE services
are affordable in Morocco.
Competition:
Yes
• INWI’s business may face a decline that needs a
breakthrough in market;
• To win the competition, skip Rev.B to migrate to
LTE is a good choice.
Resources:
A question leaves to INWI:
• Do you have the license?
• Do we need to protect your actual investment
or to seek a replacement?
with
•
-
•
-
•
-

32. © ZTE Corporation. All rights reserved.
 Mobile broadband is the most valuable market for Inwi
 EV-DO phase 6 and LTE could make Inwi keep advantage,
hold time-window continuously
 Flexible marketing and Pricing strategies could help Inwi
create differentiate advantage on the Market
 EV-DO+LTE applications and devices could satisfy market
demand with the lowest cost
Summary :

33. © ZTE Corporation. All rights reserved.
Revenue Growth
Competition
Customer Requirement
Cost Reduction