Future Trends in Mobile Communications Danuta Gray, Chief Executive, O 2 Ireland

1. Future Trends in Mobile Communications Danuta Gray, Chief Executive, O2 Ireland

2. About O2 Ireland An Irish success story • Mission: To be the best provider of wireless services in Ireland by surprising and delighting our customers at how well we deliver what they value • From 100,000 customers in 1997 to 1.27 million customers today • First with 24 hour Customer Care, first to bring data services to the market, awarded a 3G licence in July ‘02, €450 million contribution per annum to the Irish economy • Where we are going - we recognise that the customer experience is key and that technology is secondary • Operating in a fiercely competitive market

3. Future Trends in Mobile Communications What will shape future trends? • Mobile internet • Fixed/mobile convergence • Wireless broadband • Mobile commerce • Service bundling • Integrated mobile devices • IT managers preparing for the future

4. Small Events Create Quantum Shifts - This is what’s Happening in the Mobile Sector • “Alter the technology to meet the customer need” • Are we at the mobile computing “Tipping Point” • Where customer demand and technical capability converge.

5. Getting the Most from Mobile Internet • The mobile environment as a new channel, from SMS to MMS with benefits such as: • Reach • Penetration of mobile devices in Ireland is currently at over 80% • Alternatives PSTN at 50%, DSL less than 5% • Personal • People associate mobiles with an individual giving segments of one • Frequent • Always on nature of the mobile internet allows customers to access the services they want at any time

6. Business Benefits of Mobile Internet Ensuring the best customer experience for your content • Mobile screens are smaller • Mobile phone types all have different capabilities Challenges • Managing content suitable for mobile devices • Usability is different on mobile devices • Working with mobile operators who know how to do this, i.e. O2 Ireland

7. Fixed/Mobile Voice Convergence • Managing the costs • Mobile services (such as Group Worker) allow you to choose how the end user pays for the services. Almost 6,000 people now use Group Worker • Lower maintenance costs with mobile solutions.VPN functionality exists in the mobile network allowing you to use extension dialling • Mobile tariffs continue to compete with fixed line costs, therefore why have two phones? • Online bill management • Integrated fixed and mobile voice networks • products such as mobile virtual networks integrate fixed and mobile networks reducing overall telephony costs

8. An O2 Customer View on Group Worker • “For the last twelve months the Bowen Group have been looking for somefacility which would allow our employees to have the benefit of a mobilephone and have personal usage as well without the company incurring thecost” • “As an added bonus, the VPN facility, in conjunction with our own wide area VOIP network increases functionality and in particular is very useful for those on the move.” • “In short, the Bowen Group was pleased to be associated with the launch ofthis product which from our perspective, we view as a very beneficialcorporate product.” Donal Murphy, IT Manager. Bowen Group

9. Fleet Management Solutions • Sales & Field Service Solutions Integrated Fixed and Mobile Applications Why integrate Fixed and Mobile Applications? • Lower costs • More efficient working processes. • Better customer service. • More business, thanks to faster responses to potential customers • Flexible working arrangements that let staff work remotely, but remain contactable Examples currently deployed • Email, vehicle tracking, field service solutions and financial services applications

10. Fixed line substitution • With Group Worker and other initiatives, seeing upwards of 30% saving on our fixed line costs • GPRS opportunity • Realising savings on leased line costs since moving to GPRS remote access. • Reduced travel time for field service engineers • Mobile applications • More than 300 staff now have BlackBerry email on the move, giving access to real time to information. • O2’s field engineers using the XDA can remotely access intranet based applications O2 Employees Benefiting from Convergence

11. Customer demand • Access to office/internet/intranet services whilst out of the office • Mobile solutions • Development of a packet data network for remote access users. • WLAN was seen as the solution to “on the pause” wireless access to exploit the explosion in WLAN enabled devices. • Public WLAN the outdoor extension to your private WLAN • WLAN compliments current and future mobile capabilities 2.5 and 3G • Global PWLAN market (source: Planet Wireless hotspot operators database) • 42,495 Hotspots in 2003 growing to 135,060 by 2007 • 35M WLAN devices growing to 405M by 2007 • 2.6M users in 2003 growing to 78.5 by 2007 Wireless Broadband

12. O2 in the WLAN Space WLAN: Opportunity or threat? • Early stage in market deployment, low cost entry • Currently a niche market but situation expected to change • Stimulates demand and adoption of other wireless access services • Key success drivers: • adoption in the private environment, de facto standard • device availability • convenience • low cost equipment • O2 as a Wireless Service Provider. We aim to • provide a portfolio of access technologies based around customer behaviour and device penetration in the most efficient way

13. Wireless Broadband What next ? • Next generation mobile servicesFaster data application, lead to richer mobile content and applicationsReal time “video” • WLAN in the home backhauled over wireless networks • Devices with multimode capabilityWLAN/3G/GPRS capability • Networks with multi-service capability changes

14. M-Commerce • After the “hype” comes the reality • Mpark • SMS “Top-up” • SMS Banking • Future applications • POS payments via mobile, registered credit card details • Vending Companies must learn how to exploit mobile transaction capability and what it means for their business processes

15. Service Bundling • Mobile operators are already starting to bundle their own services;SMS/MMS/GPRS and voice • The convergence of mobile and fixed network services is a hot topic, the line between the two is blurring, as several new developments show: • hybrid WLAN/WAN mobile phones; • the use of synthesised voices to read SMS text messages to fixed-line users; • voice-to-text e-mail applications • The future trend will see mobile operators move more aggressively into what would be considered predominately fixed operator territory, i.e. home internet, business solutions, etc.

16. Laptop/PDA • Camera • Phone • Chargers and accessories XDA II Integrated Mobile Devices = + + + • Device Trends • Smaller • Lighter • Better battery life • Integrated • Multifunctional • Multi technology (WLAN & GPRS & GSM) • Better customer experience • Less devices to carry around

17. IT Managers Need to Prepare for Future Trends • Commercial • Understand the business benefits of a truly mobile workforce • Evaluate and prioritise emerging technology opportunities so that they are applied where they can generate the most business value • Understand your business processes and adapt them to ensure you exploit the full benefits of information anywhere • Understand the relevant information to your company and make it available to the right people on the right devices • Technology • Work with mobile operators to ensure security in a converged world • Understand the capabilities of Mobile devices and most suitable presentation of applications • Understand device and application management in a mobile world