1. The Economics of Next Generation Access Results of a study for ECTA Dieter Elixmann Dragan Ilic Karl-Heinz Neumann Thomas Plückebaum Brussels, June 25, 2008

6. 2. Some recent global developments Singapore Up to ~350mil. € gov. grant Up to ~117mil. € gov. grant Tender closed in May 2008 Tender closes in August 2008 Source: IDA Singapore NGN plan includes 2 RFPs for double separation

7. 2. Some recent global developments Japan (1) Broadband penetration in Japan according to different technologies Source: Katagiri (2008)

8. 2. Some recent global developments Japan (2) Source: Glocom (2006) Access Charges for FTTH Devices in Japan (E = NTT East; W = NTT West; figures in Yen)

11. 3. Modelling Approach Geotypes of the model > 100 Dense Rural (7)  100 Rural (8) Rural > 500 Less Suburban (6) > 1.000 Suburban (5) > 1.500 Dense Urban (4) Suburban > 2.000 Less Urban (3) > 6.000 Urban (2) > 10.000 Dense Urban (1) Urban Subscriber density per km 2 Cluster Geotype

13. 3. Modelling Approach Network elements modelled

15. 3. Modelling Approach NGA market and regulatory scenarios LLU 20% duct access no SLU 10% less revenues than in (1) and (2) 80% duct access no SLU 2nd mover P2P (5) 20% dark fibre/duct access SLU 80% dark fibre/duct access SLU 20% dark fibre access SLU 80% dark fibre access SLU 20% duct access no SLU 10% less revenues than in (1) and (2) 80% duct access no SLU 2nd mover PON (4) 20% dark fibre/duct access 80% dark fibre/duct access 20% dark fibre access 80% dark fibre access 20% duct access 10% less revenues than in (1) and (2) In 20% cases no co-location at SC 80% duct access 2nd mover VDSL (3) P2P PON Investment savings due to dismantling of MDFs, better use of infrastructure VDSL Incumbent as first mover (2) P2P PON VDSL Stand Alone operator as first mover (1) Remarks

16. 4. Some major model results Broadband technologies market share (Jan. 2008) 1) January 2008 2) Related to 2004 Source: EU 13th Implementation Report, WIK, Ipsos 64% 58% 47% 46% 62% 52% Broadband penetration per HH 1) 38% 56% 67% 64% 47% 46% Retail market share incumbent 4,8% 15,3% 79,9% EU27 5% 18% 19% 62% Sweden 16% 1% 20% 79% Spain 33% 1% 35% 64% Portugal 17% 3% 0% 97% Italy 17% - 5% 95% France 7% 1% 5% 94% Germany Mobile only users 2) Other Cable DSL

17. 4. Some major model results Subscriber distribution of potential customer base 100 5,3 100 33,9 100 42,83  100 33,7 1,8 100 37,4 12,7 100 28,5 12,2 Rural (8) 66,3 8,7 0,46 62,6 18,2 6,2 71,5 34,1 14,6 Dense Rural (7) 57,5 25,5 1,35 44,3 9,6 3,3 37,4 12,3 5,25 Less Suburban (6) 32,1 13,7 0,73 34,7 9,5 3,2 25,1 6,6 2,85 Suburban (5) 18,4 10,3 0,55 25,2 6,6 2,2 18,4 4,8 2,0 Dense Suburban (4) 8 8 0,43 18,6 11,8 4,0 13,7 11,3 4,9 Less Urban (3) 6,8 4,2 1,4 2,4 2,1 0,9 Urban (2) 2,6 2,6 0,89 0,2 0,2 0,12 Dense Urban (1) Cumulative in % in Mio. Cumulative in % in Mio. Cumulative in % in Mio. Sweden France Germany Cluster type

19. 4. Some major model results Main results: Sweden FTTH/PON Customer base Critical market share 8% 18,4%

20. 4. Some major model results Main results: Sweden FTTH/PON Urban ARPU Total cost per subscriber and month Urban Average revenue per subscriber and month in € Market share

25. 4. Some major model results Results for Germany: 2nd mover: VDSL 80% duct access Critical market share Customer base 0,2% 2,4% 13,7% 25,1% 18,4% 37,4%

26. 4. Some major model results Results for Germany: 2nd mover: VDSL 80% duct access ARPU (dense suburban)

28. 4. Some major model results Results for Germany: 2nd mover: PON 80% duct access Critical market share Customer base 0,2% 2,4% 13,7% 18,4% 25,1%

29. 4. Some major model results Results for Germany: 2nd mover: PON 80% duct access (urban) ARPU

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