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Wimax Leading the Broadband Charge in India

Mehul Kapadia General Manager Marketing & Sales TCISL

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15th Oct 2008

2008 Tata Communications Internet Services Limited, Ltd. All Rights Reserved.

A market like no other


Explosive Mobile Growth

Rapid Urbanization of the economy

A young country gearing to conquer

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The New World is upon us and India is pretty much right there

Globalization

Web 2.0

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India: Strong Economic Fundamentals


Third Largest Economy by 2050(1)
GDP (US$bn) 50,000 40,000 30,000 20,000 10,000 0 6,673 6,074 5,870 3,782 3,603 44,453 35,165 27,803
6% 4% 2.5%

With Highest Projected Growth Rate(1)


GDP CAGR (2005-2050E)

10% 8% 7.5%

8.9%

5.9%

5.5%

3,148

2% 0%

1.8% 0.9%

1.3%

1.7%

Germany

US

China

India

Japan

Russia

UK

France

Germany

US

China

India

Japan

Russia

UK

Increasing Per Capita Income(2)


Per Capita Income (US$) CAGR : 10%

Increasing Household Disposable Income(3)


1,140 961
Avg HH disposable income Rupees (000) 500 CAGR 4.6% 3.6% 2.8%

1,200 797 640 600

CAGR 5.8% 5.3%

Urban

900

All India
3.6%

250 Rural

300

0 FY04 FY07 FY08E FY10E

0 FY95 FY90 FY95 FY00 FY05 FY10E FY15E FY20E FY25E

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(1) Source : Industry Research; currency translated using 2003 US $ rate (2) Source: Street research & RBI website (3) Source: McKinsey Report: The Bird of Gold dated May 2007

France

Brazil

Brazil

India: Favorable Demographic Shift


Favorable Shift in Income Profile
% of population

(1)

Growing Work Force (15-59 yrs)(2)


% of population 100% 7% 75% 58% 60% 63% 64% 50% 64% 64%

100%

1 4

1 19

2 8

8%

8%

9%

11%

12%

80% 41 32

25% 0%

35%

32%

29% FY 2011E

27% FY 2016E

25% FY 2021E

23% FY 2026E

60%

43

FY 2001

FY 2006

0-14 yrs

15-59 yrs

>60 yrs

40%

36

Increasing Literacy(3)
% literate population

54 20% 35 22

80 70 60 50 40 36 43 55

75

0% FY 2005 Deprived (<Rs. 90,000 pa) Seekers (Rs. 200,000-500,000 pa) Globals (>Rs. 1,000,000 pa) FY 2015E FY 2025E Aspirers (Rs. 90,000-200,000 pa) Strivers (Rs. 500,000 - 1,000,000 pa)

30 20 10 0 FY 1981 FY 1991 FY 2001 FY 2011E

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(1) Source: Mckinsey Report May 2007 (Income levels are at real 2001 prices) (2) Source: The National Commission On Population May 2006 (3) Source: India stats website; 2011 rate is Indias 10th Economic Plan objective

India Huge Internet Potential


Population 1.2 billion Phone Connections 300 million

Total Population
Urban Population

Addressable Urban population

Cable Connections 80 million

300+ million

People with Phone (Wireline/ Wireless) connections

Cable/ Internet/ Broadband Connections

Internet User 70 million Internet Connections 11 million

Fixed Connections 40 million Broadband Connections 4.5 million

Provisioning of wireless technology would enable conversion of addressable market into subscribers

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Source : TRAI, IAMAI, Management estimates (Estimates for September 2007)

India Huge Internet Potential


Not enough wireline infrastructure
Legacy network with long loop lengths Unorganized cable infrastructure with poor network

Current Impediments for growth

High Buried Access Costs


200 months of ARPU as Capex Limited green-field deployment

Limited content offering restricted utility for access

Wireless to be the technology for choice

Far superior roll-out mechanism with the advantage of existing infrastructure of wireless telecom players Spectrum auction likely in near term Transforming the Indian industry Potentially large coverage and faster expansion

Wireless is the best technology to drive internet growth in India

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Bypassing Legacy the India Way Voice Services: Digital mobile is 8X of fixed lines
GSM introduced in 1995 and CDMA-1X in 2003 No analog. No standards issues

Pay TV Services: Satellite leading the introduction of digital TV


Analog cable prevalent since mid nineties Government mandates conditional access in metros Satellite (DTH) services achieve 5% share in a year 3 new players entering the market

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Target Customer base


Residential
Residential Customers

Driven by:
Price Fragmented Wide range of application/content Work from home

Branch & Small Business Driven by:

SMB

Looking for Web presence Increased replacement of Internet for other lack of infrastructure

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Wimax well suited for host of services beyond just connectivity!!

On Demand Entertainment

Memories

Mail! Talk! Video Chat!

@
Caf Culture Web Services

24

x7
I want it ALL

Always On!

Personal & Mobile

Worlds Information

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True Personal Broadband possibilities and hence create viable business opportunities for the entire Ecosystem

Personal Broadband

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Wireless / Mobile Broadband = Multiple touch points

Home

Business / Office College / School

Vehicle

Commute

Caf / Diner

Hotels

Airports / Stations

Malls

Global Roaming

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Wimax Truly the choice for India!!

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15th Oct 2008

2008 Tata Communications Internet Services Limited, Ltd. All Rights Reserved.

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