International Bandwidth Trends: Insights from ITF Meeting

1. International Bandwidth TrendsInternet2 – ITF Meeting April 24,2006 Peter BarlettoSylvie LaPerrière

2. Toward optical cable build-out madness • The internet tsunami takes everybody by surprise. • The magic potion of DWDM : by the year 2000, cables of 1000 times the capacity of previous generation were being installed. • Deregulation, easy access to capital, advances in laser and fiber technology, early players gain high valuations and spectacular internet growth creates a new generation of global cable builders: Global Crossing, Level3, FLAG , 360networks, Tyco and results in a cornucopia of transmission capacity. • Internet folly: myth that traffic will double every 90 days forever. • Capacity prices plummet: Trepidation • Capacity providers go under

3. The big build out of the early 2000’s • Starting shot was given by Atlantic Crossing (AC1) which came on-line in May 1998 and TPC-5 on the Pacific side in December 98. • Level3, Global Crossing, FLAG, 360, TGN networks emerged as the major new generation cable builders. • The final achievements were the terabit level C&W TransAtlantic cable and the Tyco TransPacific cable; both came on line early 2003. • The Atlantic has 4 terabit level cables, the Pacific one • A trinity of East-Asia terabit level cables : EAC, C2C and APCN2 and a North Asia terabit loop: FNAL/RNAL

4. Could there be some oversupply? The gap between lit and design capacity Very few cable builds likely for the rest of the decade, less willingness to expand lit capacity before demand

5. Lit capacity versus demand • Cost to activate all major unlit capacity is high: • transatlantic capacity (9.6Tb) is estimated at $3.5 bilion and $3.9 billion transpacific (7.9Tb) and $12 billion intra Asia (15.6Tb). (source: Telegeography 2005) • Some additional lit capacity likely needed in 2006-2007 • Better equilibrium between supply and demand

6. Predictions and forecasts revisited • What will fill the capacity and how fast? • Current (2005) transatlantic: voice: 13.3Gb internet 773.2Gb; other (IPL etc): 62.5Gb • TeleGeography predicts for end 2007: a slow growth scenario of 1,570Gb a fast growth scenario of 1,955Gb • This still leaves ample capacity but who would dare this time around to predict it will take 17 years to fill the cable? • Internet represents approx 85% of all transoceanic capacity use and has seen renewed growth (32% in 2004, 52% estimate for 2005). • How fast will internet traffic soak-up excess? Any new international bandwidth hungry internet applications in sight? • Bandwidth prices still keep dropping but at a slower rate—is price stability coming?

7. Toward gigabit connectivity • First transatlantic gigabit level circuit : • 2001: 2.5 gig SURFnet to Chicago Starlight • First transpacific STM-4’s • 2001: two Transpac STM-4’s • 2002: first transatlantic 10gb • Surfnet leads again • The big R&E scare of 2002: • KPNQwest disappears, Teleglobe reorganizes • Global Crossing, L3 and Tyco become major lambda providers

8. Continued Technological and Deployment Progress • 40G technology coming (?), • Router Ports exist - $$ • Terrestrial DWDM available but - $$ • Subsea possible but final development, impact to ultimate capacity, and costs are issues . • More options on interfaces in undersea equipment (GigE, 10GigE) • Interest in filling in gaps in undersea footprint, prices still high in some parts of the world. • Suppliers becoming more customer and cost focused

9. Global Network

11. Dual stack IPv4 and IPv6 access on 21 access nodes in 15 countries (March 2006)

12. 100% owner in 3 cable systems(Trans-Atlantic, Trans-Pacific, Singapore-Chennai) • Leading investor in another 3 cable systems (Sat3/Safe, SMW3 and SMW4) • 206,356 km of global connectivity • Trans-Atlantic and Trans-Pacific data transfer capacity of 1 trillion bits per second • SDH & SONET to support IP, ATM, Gigabit Ethernet • Diverse redundancy and protection capabilities • Greatest diversity to, and within, India. Network Reach | Leveraging Major Infrastructure Ownership

13. NLD Backbone • 40,000 Route Km covering 300 major cities • Pan India Coverage with dual line maintenance • Ring Architecture for redundancy • Most vibrant domestic network in India • Comprehensive Cable Redundancy • Capacity on all cables coming into India • Tata Indicom Cable • 100% VSNL Owned and Operated • SMW4 • Network Administrator • One of the largest Investors VSNL India Footprint | Diverse Connectivity to and from India

14. Major Cable Investments | Tata Indicom Cable (TIC) • Newest and Highest Capacity Cable System into India (320 GBPs) • Offers Hardware and Wavelength Protection on Wet Segment • Deep Shore-end Burial • Ring-Protected Backhaul in Singapore • Leading SLAs for Service Availability • Linked Directly to VSNL’s Redundant Network in India • Onward Connectivity from Singapore to Hong Kong, Tokyo, and USA

15. City-to-City Connectivity to: • New York City (multiple locations) • Los Angeles • Santa Clara • Portland • Seattle • Miami • Full Range of Service Offerings including: • DS-3, STM-1 through STM-64 • Wavelength Services • Fiber Plans • Ethernet Services Trans-America | Network Capacity Seattle Hillsboro (x2) Portland To Tokyo To London New York (x2) Wall Twp (x2) Santa Clara (x2) Los Angeles (x2) Miami

16. European Ring • Supports > 64 10Gb/s waves per fiber pair • City-to-City Connectivity to: • London • Paris • Amsterdam • Frankfurt • Groningen • Full Range of Service Offerings including: • DS-3, STM-1 through STM-64 • Wavelength Services • Fiber Pairs • Ethernet Services European | Network Capacity Hunmanby Groningen London (x2) Amsterdam Highbridge (x2) To New York Frankfurt (x2) Paris Bilbao Madrid Lisbon

17. VSNL Network Administrator • 16-member Consortium • Hosts Mumbai-based network operating center • 1.28 Tera bits per second design capacity • connecting 3 continents over 20,000km • Initially equipped with 160 Giga bits bandwidth (DWDM technology) • 640 Gigabits matrix Digital Cross Connect in every station SMW- 4 | Asia to Europe Segments 4 3 2 1 ALCATEL FUJITSU ALCATEL AND FUJITSU

18. 8 Fiber Pairs Cable • Supports 96 10Gb/swaves per fiber pair Trans-Pacific | Network Capacity • 8 Fiber Pairs Cable • Supports 96 10Gb/swaves per fiber pair Seattle Portland Hillsboro (x2) Santa Clara (x2) To New York Tokyo (x2) Emi Toyohashi Maruyama Los Angeles (x2) • 8 Fiber Pairs Per Cable Ring • Supports 64 10Gb/s waves per fiber pair • City-to-City Connectivity to: • Portland • Seattle • Los Angeles • Santa Clara • Tokyo • Full Range of Service Offerings including: • DS-3, STM-1 through STM-64 • Wavelength Services • Fiber Plans • Ethernet Services Guam

19. Regional Network Interconnectivity • FLAG North Asia Loop (FNAL) • Reach North Asia Loop (RNAL) • FLAG Eur-Asia • C2C Cable Network • Asia Netcom (ANC) • APCN-2 • Australia Japan Cable (AJC) • Japan Interconnectivity • Powered Com (PWD) • NTT-E • NTT-C • KVH • Tepco TGN On-Net Locations TGN Interconnect Points Japan & Pacific Region | Interconnectivity

20. C2C| Fiber Pair • Single Fiber Pair in 8-pair system • On “Main Ring” • 960 Gbps of ultimate capacity

21. Company Overview

22. The new VSNL International • Two complementary acquisitions … • November 1st 2004: VSNL India announces purchase of Tyco Communication assets; July 1st 2005: deal completed • July 25th 2005 : VSNL announces purchase of Teleglobe; February 14th 2006: deal completed. • … give VSNL international unparallelled capabilities • Today TGN represents about 36% of lit TransPacific capacity (73% of design capacity) and 20% of both lit and design capacity under the Atlantic • Teleglobe brings a global IP network, a global voice network, TDM and VoIP with 13 billion of voice traffic and global roaming • VSNL International is a leader in EoS (Ethernet over Sonet)

23. VSNL International | Tata Group Financial Stability & IT Capabilities Tata Group • 125-year old largest private sector group • $17.8 billion in revenues • Acquired VSNL in February 2002 • Tata Consultancy Services (TCS) • Asia’s largest software & systems integration services company • 33 countries across 5 continents • Key player in high-growth international markets

24. VSNL International • Global presence with operations the US, Europe & Asia • All customer segments, encompassing wholesale and corporate. • Presence in voice, data and mobile services markets Teleglobe • Leading international wholesale voice, data & mobile provider • Over 1400 wholesale customers & 13 billion minutes • 100 Gbps connectivity in nearly 80 cable systems • Reach to 240 countries/territories • 250 direct and bilateral relationships • Major supplier of voice, internet traffic and signaling conversion • Wholesale services to over 350 mobile operators • TGN • 60,000 kilometers of global sub-sea connectivity spanning 3 continents • Bandwidth at all STM/OC levels • Reliable, scaleable and fully redundant • VSNL • India’s #1 Communications Group • Leading provider of International Telecommunications and Internet Services • Largest Enterprise, Wholesale and Retail Broadband services footprint • 800,000 strong Internet subscriber base VSNL International | Integrating Key Assets

25. Our Strategy | The Building Blocks • 17 billion minutes of international voice traffic • 415 bilateral agreements • ITFS in over 80 countries • Ownership in 100+ sub sea and terrestrial cable systems • 7.68 Terabit system across Trans-Pacific, Trans-Atlantic, Intra-Europe • 5.12 Terabit system between Singapore and India • Tier 1 ISP with 67 PoPs in 21 countries • Domestic India network with 37,000km of fiber network • 122 PoPs of MPLS core backbone in India • 300,000 buildings On-net in India • 30 major Indian cities on Ethernet MAN network • IP backbone of 10 gigabits • 39 Data centers and co-location facilities across the world • Over 350 mobile customers connected for global roaming

26. + Network Related Managed Services • N/W Management • Security Content partners IMS + IT Infrastructure Services • Hosting • Storage • DR/BC Embedded applications for collaboration, security and communication MPLS-NNI using service mediation technology Voice peering = Next GenerationNetwork Capabilities Integrated Network Strategy I Next-Generation Capabilities Partnerships and ecosystem IP based core network built on owned infrastructure

27. Wholesale Data

28. Wholesale Data |Global Strengths • Tier 1 Global Network • Extensive ownership in over 100 sub-sea and terrestrial cable systems • Scalable bandwidth solutions with effective cost management • Synergy between Teleglobe network infrastructure and scalability of TGN routes • Global Tier 1 ISP with 67 worldwide PoPs in 21 countries • Global IP backbone AS 6453 connected to more than 90 countries • IPv6 leader • Market leader in satellite-based IP services • Diversely routed 10 Gbps and 2.5 Gbps wavelengths or resilient self-healing SONET/SDH ring infrastructure • Connects ISP and content providers through more than 120G of peering and 400G of customer connectivity worldwide. • Greater reach and on-net capacity (EMEA-Africa) • Enhanced service capabilities for hosted applications and managed offerings

29. Wholesale Data |Key IP Services Strengths • Tier 1 international network focused on services for carriers / ISPS • 67 Pops - 60% Outside North America • 435 Customers - 69% of Revenue Outside North America • 1 AS Number, 1 Operating Center - Reputation for Excellent QoS • 435-strong stable customer base • Expansive satellite capability to the developing world • Providing primary or back up service to key growth regions • Unparalleled global reach and local peering • Kuala Lumpur, Manila, Cairo, Riyadh, Sydney, Hong Kong • Middle East IX (MEIX), Egypt IX (EIX) Unique to ASN • Benefit from significant traffic share in several geographies • Canada, India, Spain, France, Middle East, Parts of Asia, Africa • Balanced International Content and Eyeballs • India traffic to enhance global balance • Unique peer-to-peer communities • Strongly positioned as content becomes more regional • Many customers in high growth regions • Unique eyeballs • Tier 1 peering relationships

30. Wholesale Data |AS6453 Highlights • Single Global AS • Provides superior connectivity between Middle East and Asia,Europe and Asia and North America and Middle East • Industry Competitive SLAs • Excellent round trip delay (RTD), 0% pack loss, 100% reach • Private Peering With All Tier 1 Carriers • More than 70 Peering Arrangements • 67 Internet PoPs in 21 countries Worldwide

31. Wholesale Data |Key IPL Services Strengths • Global Transmission Services • Fiber (special service ) • Wavelength Services • Private Line Services • Half Circuit Services • Largest owned infrastructure and capacities across the Pacific, Atlantic, Intra Europe and Asia • SEA ME WE 4 Network Administrators and Full Circuit Availability • Ability to provision high bandwidth in short time frames • Round the World Global coverage • Diverse and Redundant routes and service options available • Unprotected (largely TGN network or single-leg consortium cables) • Restored • Protected  • Premium Protected

32. Wholesale Voice | Global Strengths • Global Reach • # 1 wholesale international voice player with combined volume of 17b minutes • Over 350 direct and bilateral relations with leading voice operators • Largest wholesale international footprint • Hundreds of carrier interconnects provide us with diverse routing, lowest possible costs • Full global coverage enhanced with India-route strengths • Enhanced quality, stability, competitiveness • Value-Add • Global paradigm of exceptional commercial flexibility • Teleglobe systems and tools leveraged across full India portfolio • Customers benefit from faster time to market and lower costs • Automated, adaptive BestValue RoutingTM enables us to offer multiple service levels with robust quality, aggressive prices, & continuous optimization with lower SG&A

33. Mobile |Global Strengths • Global Leadership • Market leading position with more than 350 GSM operators worldwide • Mobile operators are supported with the Company’s global signaling network, enhanced roaming services, managed mobile content services, and global voice termination • World signaling conversion leadership with Wireless Global Roaming (WGR) • “Translates” between signaling network standards in North America (ANSI) and the rest of the world (ITU) • Comprehensive Services Portfolio • Enhanced full signaling range and scale from Americas/Europe to include Asia signaling anchor • Basic Signaling: to ~400 wireless operators in more than 165 countries. • > 15 billion message signaling units of value-added signaling services • Managed Roaming: Allows operators to assign roaming subscribers to the visited network of their choice • VTS Prime: Mobile call completion with guaranteed caller line identification transport to more than 35 strategic countries • Continuing mission-critical business support • Next-Generation Applications • Additional leading-edge applications offered as a hosted service offering • Push-to-talk on Cellular • IP Multimedia Subsystem(IMS) • International Prepaid Gateway and CAMEL Gateway

34. VSNL Singapore Pte Ltd.No. 5 Shenton WayUIC Building #22-07Singapore 068808+65 637 22 574+65 642 30 315 (Fax) VSNL America, Inc.2100 Reston Parkway - Suite 320Reston, VA 20191USA+1 703 547 5900+1 703 547 6555 (Fax) VSNL Telecommunications (US) Inc.90 Matawan RdSuite 101Matawan, NJ 07747+ 1 732 203 3000 + 1 732 203 3003 (Fax) 750 College Road EastPrinceton, NJ 08540+1 609 750 3333+1 609 419 1511 (Fax) Teleglobe 12010 Sunset Hills RoadReston, Virginia 20190+1 703 766 3100+1 703 766 3102 (Fax) VSNL Telecommunications (UK), Ltd 5th Floor, 30-34 Moorgate London, EC2R 6PJUnited Kingdom +44 20 7519 4610+44 20 7519 4609 Suite - 7th Floor2 Harbour Exchange SquareLondon, E14 9GE, England+44 207 519 4610+44 207 519 4609 (Fax) VSNL Hong Kong Limited2402 Bank of America Tower12 Harcourt RoadCentralHong Kong+852 3693 8888+852 3690 2022 (Fax) Asia-Pacific - Hong Kong2508 Two Pacific Place88 Queensway, Hong Kong+852 2530-8500 +852 2537 7417 (Fax) Global Teams | Local Support • Teleglobe1555 Rue Carrie-Derick Montreal (Québec)Canada, H3C 6W2 +1 514 868 7272+1 514 868 7234 (Fax) • VSNL India HeadquartersLokmanya Videsh Sanchar BhavanKashinath Dhuru MargPrabhadevi, Mumbai 400028India+91 22 5652 6400+91 22 5652 6401(Fax)

35. Thank You!