Nortel Corporate Presentation EL IMPACTO SOCIAL, ECONOMICO Y CULTURAL DE LAS TELECOMUNICACIONES INALAMBRICAS Salvador Hanono Wireless Sales © 2004 Nortel

Nortel Corporate Presentation Agenda Nortel Corporate Presentation Tendencias del Mercado Inalámbrico Telecomunicaciones Inalambricas- Evolucion e Impacto La participación de Nortel en el cambio Conclusiones © 2004 Nortel

Nortel Corporate Presentation Mercado Inalámbrico © 2004 Nortel

Nortel Corporate Presentation Y después de 5 mil años… Nortel Corporate Presentation … Regresamos a la movilidad © 2004 Nortel

Tendencias del Mercado de Telecomunicaciones Nortel Corporate Presentation Telefonía Fija Telefonía inalámbrica No Subscriber Growth Usuarios 2004 Subscriber Growth Broadband Voice & Data Traffic Growth Voice & Data Traffic Growth 2.8B Fixed Mobile EMC, Yankee, RHK Las fronteras se están perdiendo Technology Transition – VoIP/Mutimedia Technology Transition – Multimedia/3G © 2004 Nortel

Dinámicas de la Industria Movil Nortel Corporate Presentation 3G / Broadband & Subscriber Growth 9.0% 12% 24% 40% China alone: ~20% 5.8% 9.5% Number of commercial 3G networks in operation worldwide Mercado dinámico 1.57 B de usuarios globalmente +23M / mes 5 Mercados con más crecimiento: China: +4M / mes Russia: +2M / mes India & U.S.: +1.5M / mes Brazil: +1M / mes W-CDMA EV-DO 2002 03 04 Source: Deutsche Bank Source: EMC © 2004 Nortel

2G/3G Average Selling Price ($) 50 100 150 200 250 300 350 3G High End 3G Low End 2G High End 2G Low End Margin Customisation Design IPR Warranty Distribution Man. & Test Packaging Software Battery etc Multimedia Basic Modem GSM Average Selling Price($) 300 250 200 150 ASP ($) 100 50 1995 1999 2002 2005 2007

La Era Interactiva - Conocimiento Nortel Corporate Presentation La Era Interactiva - Conocimiento Hoy, la economía esta basada en la información El acceso abre la puerto para una economía basada en la información: Promoviendo desarrollo social y económico Llegando a ser un Servicio de valor agregado Evolucionando las redes de telecomunicaciones Redes fijas Redes inalámbricas Rápido crecimiento de banda ancha con facilidades de cobertura a zonas rurales. © 2004 Nortel

GSM/UMTS Operator Voice ARPU* Global Voice ARPUs 2004-09 ($) 60,00 50,00 NA WE CALA Asia CEE 40,00 $ 30,00 20,00 10,00 0,00 2004A 2005E 2006E 2007E 2008E 2009E *ARPU: Average Revenue Per User Voice ARPUs will remain stable over the next 5 years in GSM/UMTS Source: Pyramid Research 1Q 05

GSM/UMTS Operator Data ARPU Data ARPU Evolution 2000-2009 - Pyramid Data as a % of Total ARPU* 45% 40% 35% North America 30% 25% Western Europe Data % 20% Japan 15% Korea 10% 5% 0% 00 01 02 03 04 05 06 07 08 09 *Note1: SMS revenues are excluded in data ARPU Note 2: Voice ARPUs in this period remain generally flat Significant Data ARPU growth expected in all Regions

Telecomunicaciones Inalámbricas – Evolucion e Impactos Nortel Corporate Presentation Telecomunicaciones Inalámbricas – Evolucion e Impactos © 2004 Nortel

Nortel Corporate Presentation La nueva era de las comunicaciones Nortel Corporate Presentation US Broadband Penetration US Broadband Subscribers and Net Additions, By Service Provider, Q3 2004 MOBILITY Subscribers at End of 3Q 2004 Net Ads in 3Q 2004 Cable Comcast 6,554,000 549,000 Time Warner 3,716,000 168,000 Cox 2,430,555 184,446 Charter 1,819,900 108,500 Adelphia** 1,253,407 85,605 Cablevision 1,259,024 79,984 Bright House Networks* 700,000 25,000 Mediacom 350,000 23,000 Insight 311,500 37,600 RCN* 215,000 5,000 Cable One 165,600 13,300 Total Top Cable 18,774,986 1,279,435 DSL SBC 4,679,000 402,000 Verizon 3,253,000 309,000 Bell South 1,872,000 134,000 Qwest 956,000 103,000 Covad 524,900 10,555 Sprint 432,000 49,000 ALLTEL 216,885 22,351 Cincinnati Bell 123.000 6,000 Century Tel 120,869 12,049 Total Top DSL 12,177,654 1,047,955 Total Broadband 30,952,640 2,327,390 La primera linea es inalámbrica. ONLINE Las comunicaciones son Web-based BROADBAND Mas ancho de banda para nuevos servicios Source: Leightman Research Group, Inc. (LRG), November 2004 Note: * Bright House Networks and RCN subscriber counts are estimates; ** Adelphia subscriber counts do not include properties owned by the Rigas family © 2004 Nortel

CDMA & UMTS Technology Timeline Nortel Corporate Presentation 1xEV-DV Rel E Multi Carrier DV FL PDR : 10+ Mbps RL PDR : 1.8 Mbps 1xRTT (1.25 MHz) 1xEV-DO - 0 (1.25 MHz) 1xEV-D0 - A (1.25 MHz) 1xEV-D0 - B (1.25 MHz) FL PDR: 153.6 kbps RL PDR: 153.6 kbps FL PDR : 2.4 Mbps RL PDR : 153.6 kbps FL PDR : 3.1 Mbps RL PDR : 1.8 Mbps FL PDR : 10+ Mbps RL PDR : 1.8 Mbps Platinum Multicast (May be OFDM) BCMCS + MIMO ?? CDMA Evolution 2001 2002 2003 2004 2005 2006 2007 2008 2009 GSM/UMTS Evolution MIMO … GPRS EDGE GERAN DL PDR : 40 Mbps UL PDR : 10 Mbps DL PDR : 50 kbps UL PDR : 21 kbps DL PDR : 236 kbps UL PDR : 118 kbps Net sync. SAIC PFC, NACC HSDPA+ HSUPA UMTS HSDPA OFDM DL PDR : 384 kbps UL PDR : 64 kbps DL PDR : 3.7 Mbps UL PDR : 300 kbps DL PDR : 14 Mbps UL PDR : 4 Mbps DL PDR : 20 Mbps UL PDR : 5 Mbps Robust & Mature Technologies with Clear Evolution © 2004 Nortel

Creating Value That Produces Margin Nortel Corporate Presentation Hi Low Bandwidth Medium Bandwidth High Bandwidth 1xEV-DO 'Strike Zone' Future: Mobile Interactive Multimedia Traffic information Tourist information Voice Stock quotes secondary applications Music on demand GSM/WAP Portals Electronic wallet Job dispatch Directory listings Games on demand Mobile chat Field Force automation Mobility Lotteries/Gambling Unified messaging SMS General news 2-way video Auction (place bid) Travel/Ticket bookings Auction (view image) E-mail with attachment Fleet Management Video on demand Event booking Purchasing / shopping Mobile Office Telemetry (measurement) Banking Operators look for applications that create value and produces margin. Data presents a greater market opportunity. Take the data and applications and look at 2 attributes – mobility and bandwidth. Operators will look at what type of traffic required, and map that back to network and make sure the network serves the technology needs. CDMA2000 1xEV-DO provides the bandwidth to support desktop-quality applications on mobile devices, from phones and PDAs to laptop computers. A few examples of services that can be offered are: Anytime, anywhere, access to corporate intranets and databases over VPNs Subscription-based streaming audio and video content for mobile consumers, from music to breaking news Nomadic, always-on, high speed Internet access for homes and small businesses CDMA 1X is cheap and fast for applications such as digital pictures (Morgan Stanley) KTF generating approx. 8-10% higher ARPU per month versus black/white handsets. (US$33.81 to $30.05) 1xEV-DO’s ability to deliver high BW in a mobile environment is enabling the industry to offer these applications such as video/music on demand, unified messaging making them a reality very soon. Telemetry (surveillance) Lo Bandwidth Hi © 2004 Nortel

Nortel Corporate Presentation Aplicaciones Mobile Cinema Adults News Broadcast Karaoke Music On Demand Live Traffic Video VOD (Video on Demand) NATE Access Game Category Select Tetris Select Level Select Partner Compete Online Game (e.g. Tetris Competition) Rich multimedia content provided with streaming and download © 2004 Nortel

La generación del Dedo Gordo... Nortel Corporate Presentation La generación SMS: Más fácil decir “Te quiero” Propio lenguaje: qdt 1 rato + Económico SMS es 20% de los ingresos de operadores en Europa © 2004 Nortel

Nortel Corporate Presentation Servicios personalizados Nortel Corporate Presentation Padres en casa Jovenes VIDEO CALLING Integrated PC Communications Common Contacts Lists and Call Logs Call Screening One Voice Mailbox Integrated PC Communications Multi-Party Conferencing Solteros Empleados con hijos One Voice Mailbox Call Screening One Phone Number Wireless / Wireline Converged Services Call Screening One Phone Number Casados sin hijos Abuelos Wireless / Wireline Converged Services Integrated PC Communications Integrated PC Communications Segmentacion del mercado. Nueva forma de atender a los clientes Source: Pollara Inc. Research Commissioned by Nortel © 2004 Nortel

Nortel Corporate Presentation Ejemplos de tarifas en USA Nortel Corporate Presentation ILECs MSOs IXCs VoIP Bell South – Value Answers Choice of calling features $54.99 w unlimited local and domestic LD PSTN Service Traditional phones Comcast – Connections Any Distance No included features $48.95/mo w unlimited local & domestic LD PSTN Quality Traditional phones MCI – Neighborhood Complete Call Waiting, Caller ID, Call Waiting ID, Speed Dial 8, Three-Way Calling $54.99/mo local & LD PSTN Service Traditional phones AT&T – CallVantage Voice Mail Caller ID Call Waiting Call Forwarding …and more $34.99/mo w unlimited local and domestic LD VoIP over Broadband Traditional phones SBC – All Distance Connections CallNotes Plus, Caller ID, Call Waiting, Call Waiting ID, Three-Way Calling, Inline Wire Maintenance $48.95 w unlimited local and domestic LD PSTN Service Traditional phones Cox – Unlimited Connection No included features Connections Any distance $48.75/mo w unlimited local & domestic LD PSTN Quality Traditional phones Wireless Vonage ATA for existing phone Class features Voice mail Virtual phone numbers Bundles Local, LD, & features over Internet Residential – $29.99/mo Traditional phones over high speed Internet SprintPCS Free and Clear Unlimited Nights and Weekends $40 w 500 local and domestic LD Verizon – Freedom Voice Mail, Caller ID, Call Waiting, Speed Dialing 8, Three Way Calling $59.95/mo w unlimited local & domestic LD Traditional phones Additional taxes/fees may apply to packages listed Source: Company websites © 2004 Nortel

Nortel Corporate Presentation Repercusiones…….. Nortel Corporate Presentation Impacto a la vida personal Impacto Economico © 2004 Nortel

El Fenomeno de la……CONVERGENCIA Nortel Corporate Presentation El Fenomeno de la……CONVERGENCIA © 2004 Nortel

3GPP2 Standards All IP Core Network Evolution Nortel Corporate Presentation Circuit Core Optimizing by Packetizing Voice Transport (P-MSC) All IP Core Packet Core Optimizing by Standardizing Services Framework (MMD) Path to an optimized Converged Core Network © 2004 Nortel

Nortel Corporate Presentation Region 1 MSC Region 2 Region 3 Region 4 PSTN 4 PSTN3 PSTN1 PSTN2 Today’s TDM Network High Infrastructure Costs & High Transport Costs 64kbps Take Advantage of P-MSC Distributed Architecture OPEX and CAPEX Reduction Transcoder Optimization (TO) Voice Quality Improvements Packet Network MGW MSC Server EVRC < 64 kbps Nortel Corporate Presentation © 2004 Nortel

GSM/CDMA y WiFi Roaming Número único a través de SIP. Nortel Corporate Presentation Cell # 444-1234 GSM/CDMA Hace/recibe llamadas desde diferentes dispositivos Mismo número Misma cuenta Usuario convergente WCS WMN WiFi SIP # 444-1234 © 2004 Nortel

La participación de Nortel en el cambio Nortel Corporate Presentation La participación de Nortel en el cambio © 2004 Nortel

Broadband Market Segments Nortel Corporate Presentation Throughput Existing 2004-2006 Rollout 2007/8 GPRS, Mobile Circuit Switch 1X, EDGE HSDPA HSUPA EV-DO Rev A 802.16e Mobility 3GPP/2 4G? 1xEV-DO UMTS 802.11 a/b/g 802.11n F-OFDM 802.16e Nomadic Cable Modem 802.16d ADSL NG –DSL / DLC FTTx / PONS Enterprise Professionals Enterprise Broadband VoIP, MoIP, Collaboration, Specialize Apps. Sales Force Automation You can use high bandwidth application and services everywhere ! Email, VoIP, Multimedia over IP (MoIP), VPN Email, VoIP, MoIP, VPN, Collaboration Specialized Apps Broadcast, Video Mail, Video On Demand, Real-time Interactive Classes Real-time Interactive Gaming, Video On Demand Broadcast TV/Movies, Fashion, Video Mail Telecommuters High Mobility Nomadic Fixed Distance Learners Consumers Broadband Why more bandwidth? Video and MultiMedia over IP (MoIP) are predicted to be the killer app for the next few years. Residential Broadband © 2004 Nortel

CDMA Data Networks in Operation

Nortel deployment Source: Qualcomm & Nortel

Nortel Corporate Presentation Nortel presence in the world Nortel Corporate Presentation 136 GSM/GPRS/UMTS customers in 77 countries 111 GSM networks 100 BSS Radio Networks 90 Voice Core Networks 10 GSM-R Networks 81 Networks supporting GPRS 61 BSS Radio Networks 63 Packet Core Networks 10 EDGE Radio Networks 24 WCDMA networks 13 UTRAN 20 Packet Core Networks 8 Voice Core Networks 17 networks in Commercial launch Source: Nortel © 2004 Nortel

Nortel Corporate Presentation Nortel GSM GPRS GSM-R Presence 2004 Nortel Corporate Presentation NORTH AMERICA Canada Microcell USA Cingular TMO AWS Motorola Western Wireless Dobson Edge Wireless Cincinatti Bell Cellular One Amarillo CGKC&H Easterbrook Cellular Endless Mountain Pine Cellular TMP Onelink West Virginia Wireless Farmer Wireless Union Telephone Triton PCS ENMR Plateau Highland Cellular Advantage Cellular XIT NPI Great Lakes of Iowa West Central Wireless Conestoga Blu sky Poka Lambro Caprok Corr Wireless Cross Wireless CALA Paraguay Copesa Antigua Apua West Indies C&W Caribbean AWS British islandsCCT Curacao CT Aruba Setar Trinidad TSTT Suriname Telesur Guatemala Sercom Uruguay Ancel Bolivia Nuevatel Bahamas BaTelCo Puerto Rico Cingular Brazil Claro Guyana TWTC GT&T WESTERN EUROPE Belgium Orange Iceland Og Vodafone Austria Mobilkom Ireland O2 France Orange Bouygues SNCF UK O2 TMO WCML Network Rail Germany O2 DB Italy SIRTI Netherlands Orange Turkey Aycell Spain Renfe EAST. & CENTRAL EUROPE Poland Centertel Slovakia Orange SZR Hungary TMO Romania MobiFon Russia BaykalWestcom Smarts Malta Go Mobile Czech Rep. TMO Czech Railways GREATER CHINA China CMCC (7) CUTC (9) Qingai-Tibet Taiwan Chunghwa T. HK Sunday AFRICA & MIDDLE EAST Burkina-Faso Onatel Burundi Telecel CAR Telecel Zambia Telecel Mauritania Mattel Ivory Coast Comstar ASIA PACIFIC Australia Optus Telstra India BPL Nepal NTC Pakistan PTML Papua N.G. PMC GSM GPRS Core GSM R 108 networks in 50 countries © 2004 Nortel

Nortel Corporate Presentation “La red WiFi más grande del mundo” Ciudad de Taipei, Taiwan M-City Nortel Corporate Presentation Distribuida a través de toda la ciudad Transporte público, edificios públicos y educativos. Red operada por Qware. Descripción de la red: 10,000 wireless mesh access points An area of 272 square kilometers where 90 percent of Taipei's 2.65 million people live Aplicaciones principales: Comunicación entre edificios. Web browsing Video streaming Video surveillance con Camaras WiFi Comunicaciones Multimedia. Mobilidad Outdoor Comunicaciones con PDS, WiFi Phone o PC. Compromiso con la visión M-City. Press Release http://www.nortelnetworks.com/corporate/news/newsreleases/2004d/11_17_04_taipei_city.html © 2004 Nortel

Nortel Corporate Presentation El nuevo ecosistema Nortel Corporate Presentation Clients Devices Networks/ Technologies Service Enablers Application Developers System Integration HSS Call Session Controller Billing Mediation Programmable Server GLMS PoC IM/Chat MCS 5200 App Server Capacidades únicas y asociaciones claves para suministrar nuevos servicios © 2004 Nortel

Nortel Corporate Presentation Conclusiones Nortel Corporate Presentation Las tecnologías inalámbricas están: Modificando nuestro comportamiento, debemos adaptarnos al cambio rápidamente. Creando nuevas oportunidades de negocios, especialmente en el desarrollo de aplicaciones. Nortel es parte del liderazgo tecnológico necesario. © 2004 Nortel

Nortel Corporate Presentation Muchísimas Gracias……..!!!!! © 2004 Nortel