Future value creation in the mobile operator business

1. Future value creation in the mobile operator business INFOBALT conference “Information Society 2003” 21 October 2003 Darius Masionis CEO and Chairman of the Management Board BITĖ GSM UAB www.bite.lt

2. The vision of BITĖ Each further step in making life easier for our customers is a win for us. Therefore BITĖ will be number one in serving the customers, as we deliver easy-to-understand and easy-to-use communication services and we add heart in what we do. Because we care.

3. BITĖ today • 8 years in the Lithuanian market • Full scale mobile operator providing mobile communications services to the Lithuanian market and adding data and internet solutions for the business market • 100% owned by TDC • GSM 900 and 1800 mobile network covering 99% of population • EUR 30 million investment on a yearly basis • 440 employees • EUR 102 million turnover in 2002 (51% growth compared to 2001) • 485 thousand customers EOY 2002 (56% growth compared to 2001) • Ranked among Top 20 companies in Lithuania Sources: BITĖ GSM; SIC Market Research, 2002

4. The changing Lithuanian telecommunications landscape Out of 3.5 million population in Lithuania: In the beginning of 2000 • 13% owned mobile phones • 32% owned regular phones • 10% used internet • 0.5% used internet banking In Q2 2003 • 51% owned mobile phones • 25% owned regular phones • 28% used internet • 14% used internet banking Sources: Lithuanian Department of Statistics; INFOBALT Lithuania; Hansabankas; BITĖ GSM

5. The growing Lithuanian telecommunications market The Lithuanian telecommunications market revenues, mEUR Source: BITĖ GSM, 2003 figure is forecast

6. BITĖ maintains 30% of the Lithuanian mobile market Mobile voice revenue market development, % Source: BITĖ GSM, Q2 2003

7. The Lithuanian mobile telecommunications historic breakthrough 2002 Source: BITĖ GSM; 2003 figures are forecasts

8. Global communications market has changed significantly since 2000 Shift in boardroom priorities in global communications In 2000 • Optimistic growth prognosis • Hype over new economy • Increased penetration • Number of customers • Long term growth • Third generation, UMTS • Consolidation From 2002 • Heavy debts, growth slowdown • Back to balance sheet approach • Penetration peak • Increase Revenue per user • Reduce customer acquisition costs • Cash, Return on Investments • Consolidation

9. Development within current businesses Continues to be top priority • Current markets • New markets Expansion within the value chain + + Option to explore • Content provider • Content owner/ developer • Device design, offering and installation • Service outsourcing for clients • Redeploying intangibles into adjacent industries Deployment of intangibles into other industries + + Market players are in search for growth opportunities and new business models

10. BITĖ’s approach to future value creation to customers • Simple and convenient grouping of products and services in order to promote unlimited usage possibilities • Usage-oriented rate plans and points-based loyalty programs for all customer segments in the CRM environment • Integrated solutions for business customers combining their needs for communication within mobile, Internet and data services including international connectivity and VPN solutions • Consumer content and applications delivered independently of transport technology, provision of fixed and mobile portal services • Partnerships as a cost effective channel to new competencies

11. BITĖ’s products and services portfolio to make life easier for the customer Private clients Business clients Pre-paid clients Rate plans Subscriber groupings related services Loyalty programs Internet self-care Mobile solutions: mail, internet, office BITĖplus portal: mobile internet services and entertainment integrated with SMS, MMS, IVR and M-Pay

12. Connect subsidiaries Leased lines International connectivity Access @ mail Hosting Mobile Office High Speed Data GPRS Rate Plans City Plans Value added services BITĖ’s integrated solutions for business customers Virtual Private Network Self care Data Communication from A to B =>Z Internet and Intranet Communication Mobile Data Communication Mobile Voice and SMS Communication

13. BITĖ Plus portal: mobile internet services and entertainment integrated with SMS, MMS, IVR and M-Pay • Services in BITĖ Plus are organised according to basic consumer needs: • Entertainment (Logos / Ring-tones / Games / Fun&Crazy) • Information (News / Sports / Information) • M-commerce (Payments / Banking) • Socializing (Chatting and Communicating / Dating) • BITĖ Plus combines all content services BITĖ has or is running them togetherwith more than 50 partners • BITĖ Plus structure is open for partners to add content or links and charge BITĖ users www.bite.lt/en/plus

14. Partnerships are perceived at BITĖ as primary vehicles on the non-voice services growth highway The future is about… …services and applications serving the customer on the move …entertainment services stimulating customer’s leisure time The non-voice/data part is a major future driver of the mobile operator business, which involves application of competencies and technologies outside the scope of traditional mobile operator activities

15. Non-voice 7 % Voice 93 % Non-voice traffic growth and variety on non-voice services are expected to open up new revenue streams Transactions 2 % SMS 14 % Advertising 4% Business services 4% Games and entertainment 5 % Other 6 % Voice 65 % Estimated EUR810 billion market revenue split EOY 2006 EUR385 billion market revenue split EOY 2001 Source: NOKIA, 2002

16. BITĖ believes in the non-voice services demand in Lithuania Leveraging voice with non-voice services… In 2002 BITĖ’s non-voice revenues reached 12% of total revenues Within 10 years BITĖ is aiming to achieve that 50% of its total revenues are non-voice related BITĖ will keep offering flexible and easy to use mobility services that contribute to our customers’ business success and will help people create a better life.