11

VODACOM CONGO (DRC) sprl

OVERCOMING THE VAST CHALLENGE OF DEPLOYING A MOBILE NETWORK IN THE DEMOCRATIC REPUBLIC OF CONGO(DRC)

SINGAPORE ANNUAL MEETINGS

SEPTEMBER 17th, 2006

22

PRESENTATION

ALIEU BADARA MOHAMED CONTEHCHAIRMAN

Vodacom - Congo(RDC)SPRLTel : +243 81 313 1400 +27 11 784 2288

Mob : +243 81 444 8888 +27 82 999 9902

Fax : +243 81 313 1405E-mail : aconteh@vodacom.cd

contehbadara@aol.com

33

DRC inAFRICA:A uniqueconfiguration.Nine neighboringcountries

44

DEMOCRATIC REPUBLIC OF CONGO

55

Located at the heart of Africa, DRC is the third biggest country of that continent, after Algeria and Sudan, with following specificities:

• 2,345,410 sq km• 9 neighboring countries

(Congo, CAR, Sudan, Uganda,Rwanda,Burundi,Zambia, Angola, Tanzania)

• 47% of the all africa’s tropical forest

• 52% of the country covered by forest

• Many Mountains, Lakes and Rivers

66

DRC is attractive by its population and history which can be figured out as follow:

• Population: 60,000,000 inhabitant

• Growth rate: 3,07%• Life expectancy:51,46

years• Languages: french,

lingala, swahili,

kikongo, tshiluba• Independance day:

June 30th, 1960

77

DRC is a country blessed by Nature, considering its unlimited natural resources, spread in all over the country; among that:

• Copper• Cobalt• Coltan• Diamond• Petroleum• Gold• Uranium• Manganese• Tin• Iron

• Radium• Bauxite• Germanium• Silver• Zinc• Cadmium• coal• Timber• Coffee• Methane gaz

88

Among all DRC’s Natural Resources, the most important is definitely Congo River, 3,100 kilometers, the second river in the world after Amazon by its rate of flow, evaluated to 40,000 cubic meters per second.

Congo River is crossing twice the Equator. This configuration results to a very stable level of water during the year, which generates at the site of Inga, close to the embouchure, the most powerful potential hydroelectricity site of the world.

44,000 Megawatts of electricity will be produced at that site, at the final stage.

99

INGA DAM

1010

Although blessed by Nature, DRC’s economy hasn’t been able to take off and drive a sustainable development. This is mainly due to political instability the country faced since Independence. Economic key parameters are as follow:

• Nominal GDP: 7.328 billions USD ( 2005)• GDP/ capita : 700 USD (2005)• Inflation rate : 13,20 % ( 2005)• Growth rate : 6,5 % (2005)• currency : FC ( congolese franc)

1$ US= 490 FC

1111

To grow, DRC must overcome critical challenges:

• National reconciliation• Building of basic

infrastructures(roads, bridges, railways, ports and airports)

• Development of telecommunications

• Relaunch of mining production and exportation

• Relaunch of Agriculture • Production of

hydroelectricity.

1212

Among priorities, telecommunications stand as a key factor to drive the entire economy.

Telecommunications will overcome the lack of basic infrastructures like roads, railways, airports, and allow people to exchange useful information, idea, image, data and values for their development.

DRC’s telecommunication infrastructure, was totally obsolete and neglected.

This justified the option taken by the Government in 1988, to open this sector to Private Investors.

1313

TELECOMMUNICATION OF DRCIN JANUARY 2000• 2 Gsm Operators: CWN, CELTEL• 2 AMPS Operators: TELECEL, COMCELL• 1 CDMA Operator: AFRITEL• 1 Land line Operator: OCPT• 1 Wireless Operator : SOGETEL• Total Subscribers base: 145,000• Total cities covered : 10• Penetration rate : 0,07% (1:1,300), (the

lowest of all Africa)

1414

Hunting the mobile telephone signal: A public payphone on the tree in DRC

1515

1616

VODACOM CONGO STRATEGY

• Large coverage by investing in the countryside, mainly in mining cities, border cities, and cities housing UN Bases.

• Massive usage of airplane for the transport of equipment, towers, fuel, steel, cement, even stones

• Massive usage of satellite, to link remote BTS to the switch located at the main city.

• Massive implementation of public payphone in rural area(22,000).

• Low denomination voucher, from 0,30$ to 100$• Prepaid connection at 99,90%

1717

VODACOM CONGO MILESTONES• 323,110,000 USD of investment• 98,000,000 USD of taxes

generated for the Government after 52 months of operation

• Biggest south african investment in DRC

• Biggest foreign investment in DRC for the past thirty years

• Join venture between vodacom S.A.(51%) and a Congolese local company, CWN (49%)

• Good example of partnership South- South

1818

Vodacom Congo achievements

• 200 cities covered in 52 months of operation,

• 1,950,000 subscribers, the biggest network of the country,

• 500 new employment created for Congolese,

• 5000 employments of Super-dealers, Sub-dealers, and Dealers of Vodacom products in the country,

• 49 % of the market share

1919

VODACOM CONGO SOCIAL INVESTMENT 2,500,000 USD INVESTED IN:

• EDUCATION: construction and renovation of schools, distribution of school benches and school stationeries;

• HEALTH: renovation of hospital, distribution of beds, mattress and tools; HIV/aids awareness campaign; flue bird awareness campaign;

• ENVIRONMENT: cleaning of squares, protection of environment, protection of endangered animals;

• WELLFARE: distribution of clothes and foods to disabled persons, orphans, elderly and refugees; funding of micro projects for vulnerable persons.

2020

VODACOM CONGO(RDC)SPRL SUCCESS STORY

• 11/12/2001 : join venture between Vodacom Group of S.A. (51%) and CWN of DRC(49%)

• 1/05/2002 : Launch of the network in three cities: Kinshasa, Lubumbashi, Mbuji-mayi

• 31/12/2002 : 15 cities covered, and 221,500 subs

• 1/05/2003 : 27 cities covered,and 388,246 subs

• 30/11/2003 : 500,000 active subscribers

2121

VODACOM CONGO(RDC)SPRL SUCCESS STORY 2

• 31/12/2003: 58 cities covered, 622,478 subs• 01/05/2004: 93 cities covered, 741,100 subs• 31/12/2004: 120 cities covered, 969,326subs• 21/01/2005: 1,000,000 Active subscribers• 01/05/2005: 143 cities covered, 1,056,000 subs• 31/12/2005: 183 cities covered 1,391,000 subs• 01/03/2006: 1,500,000 Active subscribers• 01/05/2006: 187 cities covered, 1,650,000 subs• 30/08/2006: 200 cities covered, 1,950,000 subs

2222

NETWORK DEPLOYMENT• 200 CITIES COVERED• 328 BTS• 15 BSC• 5 MSC• 96 VSAT• 3 EARTH STATIONS

STANDARD B• 1 International

Gateway• MW Back bone 1760

KM

2323

D9

Vodacom and Celtel

MSC

VODACOM CONGO (RDC) s.p.r.l.

A26

B16

A4

A10

A28

A21

A7

A14

A20

A13

A30

A8A23

A1A16 A11

A22

A15

A29

A27A5

A6

A12

A11

B6

B7

B22

B20

B2

B21

B5

B23

E10

E13

D13

E12

E9

E11

E8

E7

E4

E5

E6

E27

E37

E22

E20

E26

E23

E1

E25

E32

E14

F12

E31

E29

E17 E3

E15

E21

E16

E28

E19

E24

E18

E2

F7

F11

F9

F5

B14B15

B11

B1

F19

F17

F13

B12

F18

F10

F20

F15

F21

F22

F24

F23

B13

F16

F14

F4

F25

F3

F1

B17

B18

B9

B31

B30

B33

B26

B25

B27

B32

B8

B24

B28

C19

C6

C16

D21

C8

C17C10

C11

C7

C12

C23

C13

C24

D26

D4

D2

D20

D27

D18

D15

D10

D16

D14

D8

D11

D23

D25 D5

D6

D3

D12

D29

D22D7

D30D31D28

D1

D17

D19

D24

C14

C3

C27

C4

C26

C2

C25

C15

C21

C1

C29

D32

C22

C9

C5

C30

C18

(100)

C20

B4

A3A24

E30

E38

B34

E36

D25

Vodacom only

(C45)

F2

E33

Updated on 18th January 06

A17A9

B10

B29

A18

C21

D32

E34

C28

Co

vera

ge

Ro

llou

tMSC: 4

BSC: 15

Sites: 298

Towns: 184

2424

16.3%15.3%

Subscriber Closing Base

70

6,1

22

1,0

40

,81

4

1,5

70

,79

2

1,0

31

,82

8

700

800

900

1,000

1,100

1,200

1,300

1,400

1,500

Clo

sin

g b

as

e (

'00

0)

Closing base 2005/2006

Closing base 2004/2005

YOY growth

2005 – 32%

2006 - 52%

2525

Capital expenditure

32

3,1

10

68

4,5

71

11

7,6

10

38

6,5

71

44

9,2

86

51

9,3

81

59

6,8

95

28

0,4

68

22

6,8

09

171177

474

272

184193206206

339

160180200220240260280300320340360380400420440460480500

2003 2004 2005 2006 2007 2008 2009 2010 2011

$

Cumulative Investment ($ '000) Capex per subscriber ($)

2626

Traffic in Erlang

1,935,695

2,044,986

2,210,746

2,406,137

2,575,650

2,959,873

3,478,059

3,304,246

2,898,470

2,856,626

2,001,114

1,739,957 1,872,527

2,172,2952,150,0662,170,477

1720000

2220000

2720000

3220000

Actual

2727

STRATEGIC OBJECTIVES

• Maintain leading network coverage

• Achieve top network quality

• Optimize and achieve effective capex management

• Obtain and retain dominant market share

• Lead through innovation ( new product and revenue streams)

• Maximize revenue on existing streams

• Maintain tariffs

• Maintain average revenue per user

• Effective cost management

• Maximize productivity and efficiency

2828

TELECOMMUNICATIONS IN DRC AT JUNE 2006

• Gsm Operators: 6 ( Vodacom, Celtel, Oasis, Cellco, Congo China Telecom, Supercel)

• AMPS Operators: 0

• Land line Operators:2( OCPT, Congo Korea Telec)

• Wireless local loop: 1(Sogetel)• Covered cities: >200• Subscriber basis: 3,900,000 subs• Penetration rate:6%

2929

Democratization of the telephone: the voice of my son!

3030

VodacomOne Nation One

NetworkThank You