Technology Overview Martin LamprechtSpecial Projects

Agenda

2

• Group technology vision and strategic objectives

• Equipment price trends, rationalisation of vendors

• Voice and data technology needs

• Shared services and outsourcing

• Global carrier services

• Evolution of technologies to accommodate ICT

To pro-actively support MTN to become a leading convergence player in emerging markets by becoming an agile and service centric organisation that utilises relevant technologies to create

business value while improving cost efficiency.

3

Group technology vision

• Strategic technology and guidance on products and services

• Transformational change and ad-hoc problem solving

• Knowledge and expertise transfer

Opco support

• Standardisation for ease of product launch and additional services

• Strategic partnerships with vendors and key suppliers

• Facilitation of infrastructure and maintenance sharing

• Identification and implementation strategies for capex and opex efficiencies

Operational efficiencies

4

Group network snapshotKey countries

South Africa Nigeria Ghana Iran Syria

2G sites 6 514 6 745 2 118 7 300 2 732

3G sites 2 873 1 808 779 - 515

2G coverage (population)

98% 85% 78% 78% 99%

3G coverage

(population)55% 24% 29% - 10%

Wimax No Yes No Yes No

BH Erlang 244k 492k 184k 396k 71k

Gateway Licensed Licensed Licensed Restricted Restricted

Fibre (km) 2 500 8 500 2 220 - -

Cable landingstations

EASSy, WACSWACS, Main1

WACS - -

Key vendors

5

2011 Vendor Landscape South Africa Nigeria Uganda Cameroon Ghana

BSS/RAN

Ericsson Ericsson Ericsson Ericsson Ericsson

Huawei Huawei Huawei Huawei Huawei

Core Ericsson Ericsson Ericsson Ericsson Ericsson

Transmission/Packet Switches

Cambridge Ericsson Ericsson Ericsson Ericsson

Aviat Aviat Huawei Aviat

NEC NEC Nera

IN/ Billing Platform Ericsson Ericsson Ericsson Ericsson Ericsson

Multi vendor approach in the IT and networks area’s ensuring pricing and technologies are suitable for emerging markets

41

37

35

36

37

38

39

40

41

42

2009 2010

6

Price erosion and aggressive negotiation

Implementation of additional saving levers is underway and will bring additional benefit in the next year:

• Optimise pricing model and business model in place

• Allow transfer of assets across OpCos to optimise utilisation

• Optimise forecasting and planning tools

• Increase supplier cost transparency during negotiation

2G

-50% p.a.

HW39 39123

73222

94SW

HW

-27% p.a.

2009

SW

2010

31

2008

2939

16

37

24

3G

-12% p.a.

Quick wins

Long term achievements

Capex spend reduced by 30-50% and opex spend by 10-15% in 3 years

CAPEX Spend- RAN ExampleUSD M

OPEX Spend- SLA ExampleUSD M

Voice evolution

• Voice revenue still approx 90% of total revenue (including interconnect)

• Main driver for subscriber growth

• Enhanced offerings

• Downward pressure on price per minute

• Increased MOU (elasticity)

• Declining ARPU’s (as penetration increases)

Voice traffic trends

• Employing coding schemes – AMR half rate

• Capture a larger volume of voice on 3G; 30-40% less spectrum needed than on 2G

• Proprietary solutions

• Introduction of HSPA allowing for more efficient voice calls on circuit switch mode and VOIP

• Actively pursuing international VOIP peering opportunities

• LTE trials

• Interfacing traditional voice call infrastructure to becoming seamless and infinitely adaptable

Evolving the network for voice

8

Data trends

• 3G network launched in 9 ops

• Driven by smartphones / tablet devices

• Data revenues and traffic decoupled

• Sufficient spectrum is a stumbling block for expansion

• Data pricing is key

• Apps shift power balance from carrier to apps developer

• Difficult to match fixed line operators

2037

435117 55

161

753

3558

3.6

0.8 0.2 0.1 0.3

1.3

6.3

0

1

2

3

4

5

6

7

0

500

1000

1500

2000

2500

3000

3500

4000

South

Africa

Nigeria Iran Ghana Syria Other Group

Data revenue(R’000) / % rev

Voice dominant

Data dominant

Traffic

Revenues & Traffic decoupled

Revenues

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Data technology evolution

• Invest in flexible, scalable and profitable flat architecture

• 3GPP specification to ensure max traction

• Wimax only employed where no 3G licence

• Radio spectrum optimisation

• Evolve and modernise SDR platforms

• LTE trial in SA

• New generation fibre transport networks

0

50

100

150

200

250

300

350

400

450

0.1 1 10 100 1000

Rela

tive c

osts

(D

imen

sio

nle

ss)

Traffic in Mbps/km2

EDGE HSPA 7.2 900

HSPA 7.2 2100 HSPA 42.2 DC 2100

LTE 10+10 1800 FTTH

GSMEDGE

3G/HSPAHSPA+

21/42/84LTE

Technology migration will be driven by economic considerations through ABC simulation of TCO

Wimax

a b c

d eStill be bestandardised

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Service delivery platform

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Convergence evolution

Prepaid Rating/Balance control

Postpaid rating /Credit

managementBilling & Invoicing ERP CRM

• Billing and invoicing for all services;

• Converged invoice – multiple service lines

CRM

Prepaid Voice/Data Prepaid

rating

CRM

All services rated & charged in real-time;

Real-time credit control available to all;

Avoidance of bill shock;

Legacy Rating/Billing System

CRM

Legacy Rating/Billing System• Postpaid fixed line

Prepaid customers

Converged customer view

Allcustomers

CRMPostpaid customers

Converged Invoicing

Postpaid ratingVoice / Data

Prepaid voice/data, Postpaid Data

Existing prepaid ServicesSupport for hybrid modelsAny new service rated in real-time

Voice / Data

Converged Charging

1

2

3

Convergence evolution

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• Two years ago: -Silo based charging & rating, customer management and Invoicing and billing time discounts for postpaid customers;

• Transition step:-

• moving new services and postpaid data services to real-time charging. Provide customers with ability to control their spending e.g. monitor their data usage in real-time

• Unified customer management – prepaid and postpaid customers managed in a single platform

• Converged/ centralised charging for all services: -

• All services charged in real-time

• Product portfolio extension to all –prepaid/postpaid/ fixed/ WiMax

• Customer choice in a payment method – elimination of billing shock

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IT shared serviceBenefits of implementation

L

E

V

E

R

S

• Leveraging economies of scale (Same product at a lower price)

• Efficiency – specialisation

• Economies of skill – Type of competencies required

• Unified governance structure

Consolidation & Diversification

• Improving services levels, quality and performance

• Increase productivity

• Consistency of operational processes

• Reducing operational complexity and resources

• Efficient operating model

Standardisation

• One global organisational structure

• Optimises the governance of the structure

• Streamlining of operations

One Way of Working

• Facilitate information, knowledge and experience sharing

• Foster collaboration

• Implement best practices

• Avoid reuse of assets and duplication of efforts

Create a new IT Shared Services

Culture

The implementation of the new pilot IT Shared Services Organisation in SEA is deriving thefollowing levers, which will result in the benefits listed below:

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IT shared services evolution

With the implementation of the new IT Shared services organisation, there will be majorchanges in the way of working at the OPCO level. Theses changes have been summarisedbelow:

“AS=IS” “TO=BE”

Services within IT Business

Varied IT Servicesprovided at an OPCO level

Only application support services provided at an

OPCO level

Reporting Lines within the IT Department

Each OPCO was a stand alone organisation and operated autonomously

IT Shared Services Or. is centralised and OPCO IS

report into the HUB

Governance structure within IT Department

Used to have their own governance structure

Global IT Shared Services Governance structure

Relationships & interactions with Vendors

Relationship was established at an OPCO

Level

Standardised/global approach for the IT

Shared Services org.

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Submarine cables investment

• Address the internal growing demand and supply gap in international broadband capacity via self-provision over shared infrastructure

• Long-term value enhancement to shareholders and customers

Strategic intent

• EASSy (East African Submarine Cable System)

• Europe-India Gateway (EIG)

• West Africa Cable System (WACS)

• The East African Marine System (TEAMS)

• Long-term leases on other cables, incl. SAT-3 (Back to back)

Cable consortia participation

• Current - STM1 Units: > 1,300 (200Gb)

• Design - STM1 Units: > 15,000 (2.3Tb over next 15yrs)

MTN capacity ownership

• All Opcos to access capacity (excl. where regulatory restrictions exist)• Abundant capacity over resilient links around Africa and Middle East, to

global peering points• Limited reliance on third parties• Cost significantly lower than market prices

MTN operations benefiting

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Submarine cable investment

• Ownership in EASSy & TEAMs, EIG & WACS• IRU capacity (indirect) ownership on SAT-3/SAFE • Multiple cross-connect points between systems to create “Y’ello Africa Fiber Ring”

MTN network cross-connect points between submarine cables

WACS• Ready Q1, 2012

• 5.12Tbit/s capacity

• 500 Gbit/s initial capacity

• MTN share approx 12%

SAT-3-SAFE• Operational (max 320 Gbit/s)

• MTN purchased 10m MIU/km (approx 10Gbit/s)

MTN WACS Landing Stations

• Cameroon• Nigeria• Ghana

• Cote d’Ivoire

TEAMs• Operational

• 1.26Tbit/s capacity

• MTN has approx 2.5 -5%

EIG• Partially Activated Jan’11

• 2.88Tbit/s capacity

• MTN has approx 8%

• Partial activation Feb’11,

permitting Egypt crossing,

•2 systems north & south

• Full activation exp. 4Q12

EASSy• Operational

• 3.82Tbit/s capacity system

• MTN has approx. 16%

• OPCOs guided by MTN Group exploring “small” capacity purchases on other cables:

• WECA: Main-1 & ACE• SEA: SEACOM & TEAMs• MENA: New cables (still

confidential)

• OPCO’s access to the MTN capacity is through MTN GCS IRUs offering end-to-end capacity provisioning from CLS to London/ Amsterdam PoP

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Roaming services

Expected benefits

• Benefit from larger volumes in negotiation

• Offer a one stop-shop to roaming partners

• Boost roaming profit by decreasing IOT

• Extend roaming footprint

• Support for smaller OPCOs to obtain agreement(s)

• Seamless testing

• Speed up roll out of roaming agreements for all MTN Opco’s

Int’l roaming partners*

* illustration of partners

Roaming Alliance

MTN Opcos 3rd-party MNOs

Alliance Key functions

• IOT negotiation for Group and/or Alliance

• Management of traffic steering

Alliance set-up preferred agreements with key international partners

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Central roaming evolution M

TN

OpCos

VAS

Expanding Roaming Footprint

Introduction of MTN Roaming Hub with expansion roaming

services with all MTN Affiliates

Activate partners to MTN Seamless Roaming platform

enabling Local Recharge

Gro

win

g R

oam

ing A

llia

nce

Connecting Africa partners to MTN Roaming Hub expanding alliance

Strengthen Alliance by connecting Strategic

RoW partners to MTN Roaming Hub

Em

erg

ing

mark

ets

Afr

ica

Netw

ork

s

Increase Business Opportunities

Int’l Remittance

Procurement

Voice SMS 3GGPRS (Data)CAMEL

Smart Call Assist

Smart Call

LoR

Peering with Roaming Hubs

VRS, Link2One, Comfone

One stop shopping to internal and external partners

• Seamless testing• Centralise resources

• CT Centric vs IT centric• Horizontal vs Vertical• Solution Partnert

Depending on market and operator’s customer base:

• SME• Large Corporation,

MNC• Selective verticals

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Critical components for operator ICT transformation

• Service packaging• Pricing & Bundling• Customer Support• Promotion• Channel

• NETWORK: Fibre, HSPA; LTE• Cloud enabled Data Centers• SDP, etc

Infra-structure

Target segments

Go to market

know how

ORGANISATIONAL CAPABILITIES

2

Service & solution roadmap

1

4

3

• Organisational Structure• Competency: IT skills, SI, Industry

knowledge, etc• Sales• Process, etc

5

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Key attributes to ICT Strategy

ICT Strategy

Self-Service

Capability

Standardisation, Simplicity, Scalability

Automation of Delivery

Processes

Open Service Architecture

Measurable QoSand QoE

Organisation &

Governance Model

ICT technology strategy

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• Deployment of a scalable open architecture that can grow with customer demand and new product and services

• Simplification of cloud service by standardising on technology, role of Open Source versus OEM software and solutions

• Deployment of a OSS and BSS architecture using current and new system capabilities

• Automation of complex Provisioning and Mediation processes (non Telco elements, disk, CPU, license consumption, QoS indicators, etc.)

• Establishment of a flexible billing capability that can accommodate fixed and usage charging across the ICT product portfolio (NaaS, IaaS, PaaS, SaaS and Manage Services)

• Establishment of a Service Assurance framework (processes, systems and human resources) that can support the required Service Level Agreements and QoS KPI

• Deployment of a robust Security framework, Security Audit Compliancy (3rd party cloud integration)

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Global public cloud, regional data centre

CloudDC

CloudDC

CloudDC

Global IP / MPLS

MTN Cloud Enabled ProductsIaaS, PaaS and SaaS

Global IP/MPLS network that provides the Data Transport Layer for the cloud services

Cloud Service Consumers (SME

and Enterprise Customers)

Regional Data Centres hosting the MTN Public Cloud

Thank you

Notice

The information contained in this document has not been verified independently. No representation or warranty express or implied is made as to and no reliance should be placed on the fairness, accuracy, completeness or correctness of the information or opinions contained herein. Opinions and forward looking statements expressed represent those of the Company at the time. Undue reliance should not be placed on such statements and opinions because by nature, they are subjective to known and unknown risk and uncertainties and can be affected by other factors that could cause actual results and Company plans and objectives to differ materially from those expressed or implied in the forward looking statements.

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