Gabrielle Gauthey of Alcatel-Lucent reviews and compares regulatory initiatives and experiences concerned with broadband deployments around the world and particularly between the US and Europe and predicts outcomes

1. Gabrielle Gauthey SVP Public Affairs Communications and regulation Time to start over? IIC annual Conference Montreal – October 27, 2009

3. Broadcast vs. Telecoms

5. Media capable Networks and Devices will become ubiquitous Main drivers for online mass media Media is getting personal Source: ALU analysis

6. Industry anticipates bandwidth needs to grow Example with Ofcom perspective More bandwidth = HDTV + better customer experience + content upload

7. Very High Speed is both fixed and mobile Stimulated by permanent technology improvement Mb/s [Mbps by subscribers] 0,5 4 8 10 24 100 1 000 500 1 2000 ‘ 02 ‘ 04 ‘ 06 ‘ 08 ‘ 10 2012 GPRS UMTS Fixed HSPA+ WiMAX HSPA ADSL ADSL2 ADSL2+ VDSL2 10 000 Femto Mobile GPON P2P - FE LTE WiMAX P2P – GE NG PON

8. Wireless data traffic is also exploding IP traffic will increase by 5x by 2013; 90% of all traffic will be video 36% 30.4% 20% 49.7% 30.9% % of users 1.5% Facebook 1% YouTube 4% Social network access 2.6% 4.6% All phones Google Maps Mobile video iPhone Source: MMetrics, March 2008 7x more video consumption on Smartphones, compared to all phones  65% of mobile data traffic will be video by 2013 (150% CAGR) Source: Cisco VNI

9. Spectrum CAPEX for investment is frequency dependant Relative CAPEX Relative Cell Cellradius defines amount of base-stations / MHz Frequencies / MHz 700 850 2100 2500 3500 5800 700 850 2100 2500 3500 5800 Capex /%:= Capex /%:= Invest in new network 100% 126% 328% 455% 675% 1230% 100% 126% 328% 455% 675% 1230% 1400% 600% 200% 1000% 1200% 1400% 600% 200% 1000% 1200% 12 10 8 6 4 2 0 Radius / Km 12 10 8 6 4 2 0 Radius / Km 4.7 10 km 10 km 2.9 2.9 8.9 8.9 5.5 5.5 4.7 3.9 3.9 700 850 2100 2500 3500 5800 100% 126% 328% 455% 675% 1230% 10 km 2.9 8.9 5.5 4.7 3.9 10 km 2.9 8.9 5.5 4.7 3.9 10 km 2.9 8.9 5.5 3.9 Quelle : SCF Studie ( www.digitaldividend.eu ) T - Mobile Quelle : SCF Studie ( www.digitaldividend.eu ) T - Mobile

10. Regulatory issues

11. European Union United States Broadband Access fully Regulated Newly Revised Regulatory Framework Policy & Regulatory Frameworks CompetitiveTelco vs. Cable Access Infras Net Neutrality Debate Broadband Access NOT regulated Why are the US and EU approaches to broadband so different? Lower Density, Aerial fibre Newly Revised Regulatory Framework Only one Access Infra High density, Buried fibre

14. Dynamic of the french broadband market 2002 2003 2004 2005 2006 24Mb/s 8Mb/s 1Mb/s 512kb/s 1st TV/DSL offer 1st telephony /DSL offer 1st fixed-mobile Convergent offer ADSL ADSL2+ Evolution of broadband technologies and services 1st broadband/ DSL offer 1999 … DSL coverage as of June 30 2009 2007 2008/2009 FTTH 100 Mb/s 1st Very high speed FTTH offer Growth of the broadband access base

15. Impact on unbundling 37% of French central offices are unbundled through Local Communities backhaul networks 913 773 988 CO unbundling : alternative carriers backhaul networks CO unbundlig : alternative carriers backhaul networks + France Telecom dark fiber rental CO unbunling : local community bakchaul network 14,4 M households 2,4 M households 4,0 M households 20,9 M households Number of unbundled CO’s according to backhaul network ownership

17. Reality check : regulated duct sharing and Wholesale Bitstream Access Under consideration MDF to cabinet (Proposal) MDF to cabinet Not yet. Following an appeal, implementation deadline postponed by court Research under way Up to 30 Mbps Trials only FTTC+VDSL2; Research under way for other FTTx VDSL2 Duct Sharing : technology neutral WBA : technology neutral

18. Reality check : FTTH last drop sharing including in-house wiring France - Sharing of the terminating segment (from the mutualisation or handover point) - Model agreement between landlord and the operator deploying in-building fibre (“the building operator”) - Obligations of the building operator to the property owner to equip the building and to 3rd-party operators to provide access to its network - New buildings will have to be prewired with fibre starting in 2010 Spain Draft decision: symmetrical obligation for first operator to deploy fibre within a building to share network elements and equipment on reasonable request. Portugal Draft proposals for legislation expected in 2009 Finland Draft decision + in-building wiring is the property of the building owners/housing associations Italy Installation of in-building fibre does not require property owner's prior permission

19. Challenges for the future

23. Security is a complex puzzle of legislative, regulatory & data protection policy Security Regulation Personal Data Protection Privacy Protection Network Integrity Legal Interception Content Protection Access to data: Always conditional Prior notice & consent before usage Protection of critical assets, NP obligations NGN interoperability with Authorities Internet rights & Status of IP Addresses

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