2. Contents 1. About SVP Advisors 2. Our experience – selected case studies 3. Contact details 2
3. SVP Advisors is an international management consulting firm for the communications industries specializing in business strategy and regulation Established by seasoned professionals in 2006, we have earned over time a solid reputation within the broad communications sector thanks to our quantitative and practical approach in consulting assignments Our work combines various disciplines such as economics, econometrics, finance, accounting, marketing, engineering, and computer science 3 Company Profile
10. People Julio Villalobos Partner Technology & Regulatory Expert Marco Gatti Director Regulatory Expert Francisco Velázquez Partner New Ventures & Financing Expert Dimitri Kallinis Partner Business Strategy Expert Over 10 yearsexperience in strategy advice and operations in the communications sector Lead several TMT strategy consulting assignments for int’l clients. Former Head of Residential Unit at On Telecoms, a leading Greek 3Play Operator, responsible of Products, Sales Strategy, Content, MarkComms &Pricing Areas of expertise: broadband, MVNO, IPTV, business planning, commercial strategy, market analysis Over 10 yearsexperience in strategy advice and operations in the communications sector Extensive track-record of costing, regulatory and strategy consulting projects for fixed and mobile operators in several EU and Middle East Countries. Former Team Leader of Technology Strategy at Telefónica Spain Areas of expertise: ADSL, fixed & mobile networks, techno-economic modelling, regulatory strategy, regulatory accounting Over10 yearsexperience in strategy advice and financing in the communications sector Telecoms financing expert, participated in >10 large M&A transactions and in >20 syndicated loan transactions over the last few years. Has actively participated in innovative ventures through an investment fund Areas of expertise: new technology & media ventures, start-ups, innovation, financial transactions Over 10 years experience in regulation and policy in network industries Extensive in the field experience in telecoms regulation. Regular speaker at TMT conferences and media events. Former Senior Economist at OFCOM (Swiss NRA) and Chairman in the IRG Regulatory Accounting Group Areas of expertise: regulatory policy, regulatory accounting and costing, competition analysis 7
11. Contents 1. About SVP Advisors 2. Our experience – selected case studies 3. Contact details 8
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13. The price squeeze model produces results based on a number of wholesale services, such as bitstream, colocation, shared and full LLU, and interconnectionMargins of a typical double-play offer considering economies of scale and technology choice Note: chart has been altered for confidentiality reasons 9
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18. AGCOM has used the results of his audit in the price cap mechanism applying to H3G’s wholesale mobile termination ratesSchematic overview of H3G’s Regulatory Cost Accounting System 11
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21. The results of the audit were used by the NRA in setting regulated tariffs and monitoring relevant markets to ensure fair competition
22. We have carried out this project for the CMT during 4 subsequent years, from 2007 to 2010Evolution of current costs by regulated activity segment 12
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26. Disparities among EU countries were also investigated to understand the limitations that such disparities impose on the search for a unified USO regulatory framework at European levelConditions justifying public intervention for provision of telecoms services 14
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28. We first examined which framework best corresponds to the market and operator conditions in the relevant country, considering previous international experiences and country-specific market data. A methodology was devised for the calculation of the retail-minus factor, as well as rules for the assessment of retail offers and the review of wholesale tariffs
29. We then supported our client in carrying out a public consultation to ensure an adequate reflection of the different operator views and market realities.
30. A Discount Cash Flow model was developed in order to replicate the revenues and costs of a generic alternative operator. The results of the model were used to establish new wholesale tariffs.Retail-Minus calculation model 15
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32. The transaction was a refinancing syndicated facility of US$600 million co-financed by several commercial banks from LATAM, US and Europe
33. We provided a market and technical due diligence report, including revenue, capex and opex analyses, as well as payback analysis and sensitivity analysis
34. Our work included on-site visits to perform management interviews, on the ground market analysis as well as network and operational facilities’ monitoring.
35. Based on the main findings from our review we build a revised case with a different set of hypotheses and parametersIllustrativeexample of theanalysiscarriedoutduringtheDueDiligenceprocess 16
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37. As part of our work, we developed a Tool for determining the economics of different MVNO business models to be potentially hosted in its mobile network
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39. The Tool was instrumental in assessing the viability of MVNO models in the current market situation, under different scenarios of market penetration and cost structure (including the wholesale cost for airtime)Mobile operator (EEC) 2010 Schematic Overview of the MVNO Tool 17
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42. Finally, we developed a Business Case based on the business model and target markets previously defined. The Business Case produced a full range of economics based on different scenarios of addressable market, service penetration, events covered, average usage and spent, as well as net revenue (fees) for the betting companyOverview of the key economics of the Business Case – Base Scenario Note: figures have been altered for confidentiality reasons 18
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44. The model covered all services and activities carried out by CP in the postal value chain: collection, sorting (inward and outward), transport and delivery
45. The model takes into account cost efficiencies achieved in certain processes, variations in costs due to different service parameters (e.g. items’ weight) and geographical specifics
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47. Contents 1. About SVP Advisors 2. Our experience – selected case studies 3. Contact details 20
48. Contact details Contact Persons Mr. Julio Villalobos – Partner Julio.Villalobos@svpadvisors.com Mr. Dimitri Kallinis – Partner Dimitri.Kallinis@svpadvisors.com C/ Almagro 15, 5th floor 28010, Madrid Spain Telephone number: +34 91 310 2895 Fax number: +34 91 141 28 11 Company Details
