1. The development and distribution of
applications in partnership with MTS

2. 2
I. About MTS
II. Foreign and domestic markets for
applications
III. Types of Appstores. Description of JIL &
WAC
IV. The steps toward partnership

3. 3
Key facts of MTS
69.3
102.4
$9.8
Subscribers
Number, mln
Revenue
USD, bln
Summary, 2009
 MTS is largest operator in Eastern Europe,
positioned as one of the top-10 mobile operators
in the world based on number of subscribers
 The brand “MTS” is the most valuable brand in
Russia, and is one of the world’s top-100 brand
names
 MTS is a member of JIL/WAC
 Since 2000, MTS is traded on the NYSE
 Since 2008, MTS has been an exclusive
strategic partner of Vodafone Group Plc
 In 2009 MTS entered India market
 In 2009 MTS merged with Comstar-OTS, the
largest operator of fixed telecommunication
service in Russia and CIS
* without India
MTS is largest phone operator in Eastern Europe with subscriber base more
than 102mln *
17.6
1.1
4.6
N/A
2.1
0.2
0.3
7.1
1.8
0.1
8.2

4. 4
I. About MTS
II. Foreign and domestic market of
applications
III. Types of app stores. Description of JIL &
WAC
IV. The steps toward partnership

5. 5
Foreign developers
Domestic developers
World market
Russia & CIS
Market
Current opportunities
Potential opportunities
The distribution of application via MTS will help developers to extend their market
geography
1
2
• More than 2B subscribers
• China
• USA
• India
• Japan
• Italy
• Norway
• UK
• Spain
• Greece
• Austria
• Germany
• Portugal
• Turkey
• More than 102M subscribers
• Russia
• Ukraine
• Belarus
• Armenia
• Uzbekistan
• Turkmenistan

6. 6
16,6
11,1
8,1
6,0
4,7
201220102009
+37%
2011 2013
It’s anticipated that in five years, applications will become the fastest growing
segment of mobile market
Source Frost and Sullivan, RBC capital market
Growth of apps market in the world
In Billions (USD)
Main factors contributing to growing
application consumption in the world
Increasing
number of
smart-
phones
• Smart-phone users are the
target consumers of apps
• Smartphones share is expected
to grow from 14,8% to 28,3%
between 2009-13
New sales
channels
• The opening of new app stores
will push the consumption
among smart-phone users
Growing
number of
applications
• New apps, focused on specific
interests of users and smart-
phones with high performance
According to experts (Gartner,
Booz and Co & others.), the market
for applications will grow more than
4 times by 2013 .
1

7. 77
The mobile phone market will grow an
average of 5%/yr from 2010 – 2014
mostly due to smartphones
In 2010, more than 1,3bln mobile phones
will be sold in the world, and 250mln of
them will be smartphones
By 2013, mobile will move ahead of PC’s
as the most common way of accessing
Internet
In 2014, 3 out of 10 phones sold will be a
smartphone
* - By Frost & Sullivan
Smartphones sales will be the only growing segment through 2014
0
200
400
600
800
1000
1200
1400
1600
2008 2009 2010 2011 2012 2013 2014
Smartphones
Java phones
Forecast of handsets sales in the world (mln)
1
12.5 14.8 19.8 24.3 27.2 28.3 31.4
Percentage of smartphones in world market12.5

8. 8
The market of mobile apps in Russian is at early stage, but has a huge potential
- More than 215MM users,
- Penetration of mobile communication is148,5%
- More than 10% users use smartphones, predicted level of penetration of
smartphones in Russia by the end of 2011 will be more 20%
- Usage of mobile internet: more than 22%
Market volume
- SPB Software House
- More than 50 private developers(Shamrock, Herocraft, Paragon, Intervale)
- Internet resources (Yandex, Rambler, VKontakte, Odnoklassniki, Mail.ru)
Major players
Main goals
Distribution
channels
- MNO portals and app stores
- app stores: Apple, Android Market
- Payment: 90% payments done via SMS billing
2
- Creating of efficient environment of collaboration with developers
- Creating effective sales channels
- Increase the popularity of applications among MTS
The market for mobile applications in Russia and CIS countries has great potential,
provided an effective monetization services, and construction of high-quality channels
of sale applications.

9. 9
Mobile games will grow 1.6 times by 2013, resulting in ~ $246MM USD
5%
25%
Java apps
Games
70%
Application of other OSes
106
150
151
2009
+63%
2013 Forecast
246
22%
17%
61%
The structure of selling games and apps
US & EURussia
• Undeveloped Russian market applications are
associated with the following factors:
– Low penetration of smartphones
– Insufficient number of applications on the
market
– The lack of special app stores
By 2014, the Russian market will be similar to the USA and EU,
game and app sales will increase 63%
• Assumptions for 2010-13
– Selling games – natural growth 8-10% year
– Selling apps– quick growth ~21% partially due to
removing obstacles preventing market development
– Proportion of Java-app reduces as number of smart-
phones grows
Unlike the U.S. and EU, games and Java-based
applications account for the majority of sales in Russia
Russian market for games and applications MM USD
Source: estimates of MTS
46
97
2

10. 10
I. About MTS
II. Foreign and domestic market
III. Types of app stores. Description of
JIL & WAC
IV. The steps toward partnership

11. 11
There are more than 40 app stores in the world, their development is supported by four
major participants in mobile market
• Support only their OS • Available only on
proprietary phones
• Available only for
subscribers
• Collaboration only with
some providers
OEM app stores Operator app storesPlatform app stores Independent
participants
Existent app stores
All existing app stores have a number of significant restrictions including both the
geography of sales and the monetization of applications
• Goal:
Pushing their OS to
improve positioning in
adjacent areas
• Goal:
Decrease
monopolyzation
application market by
sole participant
• Goal: Increase
customer loyalty and
reducing churn
• Goal: Distribution of
commercial
applications

12. 12
JIL (Joint Innovation Lab) is an exististing mobile apps development environment
integrated into the Vodafone app store
RUSSIA
Development
Technical
capabilities
Distribution
JIL provides efficient tools for development and distribution
 More than two millions devices in the
world
 Supports more than 70 device types
 Support of TouchScreen, non Touch
Screen, QWERTY keyboard, T9 keypad
 Usage of Cross Up Sales and
Recommendation Engine
 Ability to sell applications in 14 countries
 Integrated billing
 Online statistics www. jil.org
 Distribution through WEB / WAP interfaces
 Specific SDK
 Convenient environment of application
downloading and sale statistics analysis
www. jil.org
 Specific system for testing applications

13. 13
WAC – world-wide association, uniting mobile operators and phone manufacturers
to establish uniform rules for the creation of mobile applications
Goals of WAC
WAC members
• More than 24 cell phone operators
• More than 2 users worldwide
• Three phone manufacturers(Sony Ericsson, LG,
Samsung)
• Development of SDK based on JIL
• Development of common schema for development
and distribution on all phone operators
• Consultation support
• Forums and seminars for developers
• Providing distribution of all operator members
of WAC
• Support of a development and distribution
platform
• Forming a convenient development environment
• Forming common rules of development,
monetization and distribution of apps
App distribution
WAC for
developers
Detailed descriptions

14. 14
Integration of JIL and WAC will promote common global rules in application
development for both operators and application developers
Financial terms
Administrative
terms
Logistics terms
of distribution
• Revenue share: 70% developer and 30% MTS
• Developers may assign the price of their applications( 0 -500
RUR., including tax)
• Payments to Russian developers will be deposited directly to the
developers' bank account
• App developers must sign a contract with Vodafone Sales and
Services Ltd (VSSL), that will enable distribution in Russia (MTS)
and other countries Vodaphone supports (and than in WAC)
• Developer are expected to assign the target countries
Terms of
cooperation JIL &
WAC with
developers
• The application will be tested by Vodafone within 14 days
• Contract execution and online metrics for a developer is available
on www. jil.org

15. 15
I. About MTS
II. Foreign and domestic market
III. Types of app stores. Описание JIL &
WAC
IV. Steps toward partnership

16. 16
Getting
developers
into JIL/WAC
Increasing
consumption
Developing sales
channels
Key factors
Building a friendly coop scheme with the application developers is a key
strategy for MTS
Main factor of success: Getting a high
degree of penetration on mobile
phones that support JIL / WAC
applications
Getting
developers into
JIL/WAC
Состав WAC • Users billed directly from their account
• Developing app stores with relevant content
• Advertizing support for the MTS app store
• Integrate app store inks from MTS-
customized browsers(Opera Mini)
• Pre-installation of app store application onto
every proprietary MTS phones(15% of
market in Russia by 2011)
• The use of incentives and price advertising
campaigns
• Support of various Operating Systems
• Development of open information system at
www. partners.mts.ru
• Consultation support
• app store advertising support
Increasing
consumption
Developing
sales channels
Detailed description

17. 17
The Application Store will be a strategic product for MTS and will be
distributed via all possible sales channels
MTS
Application
Store
MTS branded
phones
Other
channels
Customized
version of
Opera Mini
Interactive Cell
Broadcast
 Major sales channels :
– Installation of quick access
in mobile browser (Opera
Mini)
– Pre-installation of app
store application on brand
name phones from MTS
• Active ad company via SMS,
MMS, ICB for smart-phone
users of MTS
MTS has a significant amount of channels it can use for selling selling
applications
Sales Channels
WEB
Portal
WAP portals of
MTS
Sales Channels

18. 18
Developers must fulfill the following requirements to distribute their
apps via the MTS App Store:
Step 1.
• Please visit www.
developers.mts.ru to review all
documentation (available
starting 01.01.11)
• Contact the MTS representative
and discuss the opportunity to
sell your applications through
the MTS app store
• Provide a description of your
application, screenshots and
proposed price point
Step 2.
• Complete the agreement form
at developer. vodafone. com
with VSSL (Vodafone Sales
and Services Limited)
• Upload your Android apps to
developer. vodafone.com
• Your apps will be automatically
tested by an internal Vodafone
system and published to the
MTS app store.
Step 3.
• After testing, your apps will be
published on the MTS app
store
• Metrics are available at
developer.vodafone. com
• Payments for your apps will be
deposited in any currency
(USD, EURO, RUR)
Sign Contract Publishing apps Selling apps
* - before 15.12.2010 only Android apps supported
Uploading Symbian и Java apps will be available from 01.02.2011

19. 19
The following links provide additional information:
 www. developers.mts.ru
 MTS Partner Developer site (in progress)
 http:// developer.vodafone.com
 Android Platform
 http:// developers.vodafone.com/blog
 Widget developers Blog

20. 20
Thank You!
Contacts:
Roman Savvin– Project Director
e-mail: rpsavvin@mts.ru
Mob: +7 916 056 80 30
Polina Miloshevskaya– Project Manager
e-mail: pimilash@mts.ru
Mob: +7 916 051 16 91