M2M | IOT

1. M2M | IOT Theresa Wong Verizon Corporate Strategy

2. Internet of Things By 2020, the Internet of Things will reach 30B devices, connected through heterogeneous access technologies. Industry is still in nascent stage of growth with new use cases and business models emerging over time. Security Safety Energy Mgmt PCs Storage Switchers Routers INTERNET OF THINGS Supported by cloud services Internet of Things 30B devices by 2020 connected to the cloud IT & Networks Buildings Smart Grid Wind Mills Oil Field Monit. Public Safety Energy Ambulance Lone Worker Homeland Sec Consumers Retail Healthcare Transport Industrial Consumer Electronics Energy Mgmt. Media & Entertainment POS Displays Vending Tolls Shipping Traffic Signals Vehicle Tracking Dispensers Blood Pressure Medicine Del. Telemedicine Pumps Valves Pressure Gauge Source: Gartner, VZ estimates

3. Evolution of M2M into IOT As the industry evolves, competitors must adapt to changing customer needs, in order to advance the market. 2000 2008 2014 2016 CUSTOM SOLUTIONS PACKAGED SOLUTIONS: THIRD PARTY | VZ-E2E APPLICATION ENABLEMENT CONVERGENCE • Need: Wireless Connectivity • Need: E2E support for large, scalable packaged solutions • Need: Seamless, low-cost enablement for long-tail opportunities • Need: Integration of multiple silo-ed solutions

4. The IOT Opportunity is GlobalNon-cellular Technologies Will Be Pervasive Growth is expected to be high. Most of the activity will be global, and will leverage multiple networking technologies. Global connected devices 2020 installed base breakdown by segments (B) Devices breakdown by vertical (B) Devices breakdown by (B): Technology Geography % Split 41% 25% 21% 13% 14.3B % Split 37% 13% 27% 23% 14.3B CAGR 28% 23% 10% Home automation 33.6B 14.3B Energy APAC WLINE M2M 3.6 Professional IT CE 14.3 Industrial WWAN PC+Mobile+TAB EU 2.2 Buildings 2.0 Homeland Security 5.7 0.8 WLAN 1.8 Transportation 0.7 NA 8.9 1.4 1.5 0.6 Healthcare WPAN 13.6 ROW 1.2 0.5 Retail 6.2 0.7 Others 2012 2020 2020 2012 2020 2012 2020 Source: PC+ Mobile handset +TAB = GARTNER, CONSUMER ELECTRONICS=Strategy Analytics, M2M = Harbor Research, Machina Research, VZ Estimates

5. Market Prioritization & Capability Build-out Build on connectivity through Platform services and targeted End-to-End solutions 2017 VZ Addressable Market OEM & AFTERMARKET TELEMATICS $7.5B COMMERCIAL TELEMATICS $3.9B EDUCATION MANUFACTURING RETAIL FINANCIAL SERVICES Others ENERGY | SECURITY $6.8B HEALTHCARE $2.0B HUGHES E2E VIA PARTNERSHIPS ENERGY, HOME AUTOMATION REMOTE HEALTH MGMT, OTHERS E2E SOLUTIONS – OEM/ Aftermarket – – Network Fleet – SURERESPONSE DATA ANALYTICS | PROFESSIONAL SERVICES M2M PLATFORM HUGHES PLATFORM | NPHASE PLATFORM PLATFORM ENHANCEMENTS M2M CONNECTIVITY - 2G | 3G | 4G LTE | IP Backbone | FIOS -

6. Hughes Telematics & VZ M2M Enablement Hughes Telematics enables several vertical strategies integrated into a strong M2M platform OEM TELEMATICSSuccessfully launched with MB USA & contracted with VW USA AFTERMARKET Insurance relationships & services COMMERCIAL Experience & IP • End-to-end Service portfolio & IP • 2 OEM accounts & strong offering to others • Potential global expansion • End-to-end service play • Insurance customer relationships • 7+ yrs experience in commercial telematics • >120k subs & VAR channels • Strong IP & branding M2M PLATFORMStrong platform capabilities • Meaningful entry to automotive OEM market • Flexible and extensible M2M Platform foundation • Integrate into VZ & nPhaseinfrastructure

7. Wearable Segments 200M Wearable devices by 2018 Fueled By Quantified Self Movement 8M 32% 51M 26% 45M 44% 28M 47% 2018 UNITs 5yrCAGR • Fitness • Wellness • Chronic • Camera & PMP* 34M 500% 53M 195% 1-3M 30% 7M 200% Smart Apparel 3d motion sensors/ Tracker • PERS - VZ • Non PERS - Motion Detector • Enterprise • Smart Watch • People Tracking • Others Source: ABI; *PMP declining at 10% - non Apple forecast= 8M US (2018); Apple = 18m PAYER ECOSYSTEM VZ STRATEGY CONSUMER INSIGHTS

8. Smart Cities: Megatrends Driving Market DEMOGRAPHIC CHANGE ENVIRONMENTAL/ CLIMATE CHANGE ECONOMIC DEVELOPMENT • Expansion of urban populations • Provision of basic infrastructure in new urban populations • Cities responsible for 70% of global energy consumption and greenhouse gas emissions • Urban economic development to drive municipal competitiveness

9. Smart Cities: One Size Does Not Fit All EMERGING ECONOMIES WESTERN EUROPE UNITED STATES POPULATION TRENDS CHALLENGES FACED BY THE CITY • Huge population influx • Provision of infrastructure services: water, wastewater removal, electricity supply, transportation infrastructure • High energy costs • Soaring energy costs • Global competition for Enterprise investment and high-income jobs • Attract and keep high-earning residents • Protect existing, aging infrastructure • Optimize transportation infrastructure, flood prevention and management • Lower energy consumption SOLUTIONS DESIRED • Water safety monitoring and wastewater flooding notifications • Notification of electricity theft • Flood prevention • Smart Citizen Services • Smart Grid • Smart Street Lighting • Microgrid, solar panels • Road Use Charging, Toll roads • Video Surveillance • Flood Prevention, Infrastructure Mgmt • Congestion Management | Smart Parking | V2X | EV • Smartgrid • Smart Streetlighting • Signification Urbanization • Rise of a significant middle class • Limited urbanization • Aging populations • Significant unemployment • Well-educated; access to technology • Rising healthcare expenses

10. Converged Health Management Providers Enablement through Verizon’s Digital Healthcare Management Platform Solution Mobile Doctor’s office/ clinic Video Payers Biometric Care Access & Management Tools Stakeholders Cloud-based management platform