What‘s new in Germany?

Segmented market approach by strong propositions

of innovative products
Lutz Schüler
Senior Vice President, O2 Germany
What’s new in Germany

The customers’ world O2 Offer

• New prices, bundle benefit

Fairness • One bill

• S/M/L structure
Simplicity
• Few price points

• Modular offerings
Value Add • Pay consideration to special
requirements

The O2 Offers are shaped around fairness, simplicity and are focussed on adding value to
the targeted customer groups.
Proposition for the ‘young generation’

JUSTIN
I want:
• 17 years
... to stay in contact with my friends
• Attending school
... to control my telco budget and therefore prefer • Tight budget
Prepay • Plays drums in band
... to make cheap calls to my friends - especially • Living with his parents
off-peak and at weekends
... to be entertained when I am bored ( “kill time”)

Market Size for age band 14-19 years:

c
~ 5,3 Mio customers*
* Tele.Basics Home 2006
Relevant products for young generation

VOICE INTERNET CONTENT

O2 LOOP S/M/L Use of parents’ Internet Mittendrin free
• Cost control (prepaid) access • Mobile Soap
• One price around the clock to all • (e.g. O2 DSL) • MMS & Video
networks
• Tariff model with top-up based
incentive scheme O2 Games 2-6€/game

Top up 20€ get 5€ for free • Mobile & Online games

Top up 30€ get 20€ for free • Convergent games
O2 LOOP
Weekend-Flatrate O2 Music From 99ct
• Free fixed net and O2 calls on • Mobile Soap
the weekend • MMS & Video
5€/month

c Key benefit: Entertainment at your fingertips independent of place and time

Proposition for students

STEPHANIE
I want:
• 25 years
... to be independent & free
• 7th terms physics at University
... to be available for my friends but I don't want Aachen
them having to face high cost for calling my mobile • Currently on internship in
Stuttgart
... to minimize regular costs
• Active beach volleyball player
... internet at home for convenience. If I am downloading huge
volumes for university I am using university access.
... support organising my life

c Market Size for age band 20-29 years:

~ 9,2 Mio customers*
* Tele.Basics Home 2006
Relevant products for students

VOICE INTERNET CONTENT

O2 Genion M O2 Genion O2 Communication
• Free calls to fixed net and O2 • Internet access via 3G mobile in Center
from home (homezone) homezone • phonebook and calendar
• Flexibile choice of homezone • Availability for occasional use backup
location on the move • free birthday reminder
• Cheap calls on the move with (via SMS)
one price anytime Free

20€ No add. base fee • Receive and answer unlimited

e-mails anywhere (via MMS)

Pack 5€

c Key benefit: Telephony and Internet access at one monthly fee

Propositions for families

We want
FAMILY MÜLLER
... to keep close contact within our family, wherever we are • Martin and Petra
• Daniel (16 years)
... to control our family's telecom spend
• Lena (12 years)
... convenience in administration • One family income
... safety of kids • Hobby: Inline Skating

... easy to understand tariffs and support

with technical matters
... entertainment for the whole family

c Market Size for age band 30-49 years:

~ 22,4 Mio potential customers* * Tele.Basics Home 2006
Propositions for families

VOICE INTERNET CONTENT

O2 Mobile + DSL O2 DSL TV & Video
On the move: • High speed access • Selected TV formats on 3G
• Genion S/M/L for parents (up to 16 Mbit/s) mobile
Free
• LOOP for children • Plug’n’play Mittendrin
• Surf-Flatrate • Mobile Soap
from 15€
At home: • Discount for O2 Postpaid • MMS & Video Free
• Fixed Line VOIP via DSL customers
• Different numbers from 35€
• Pay-as-you-go or phone flatrate

Outlook: Family Pack with cheap Outlook: “Real” TV on the

rates between family members move DVB-H - IP-TV at home

Key benefits: Single point for all telecom matters: sales channels,
c
customer service, invoice cost savings for communication within family
What’s new in Germany - summary

Customers O2 Offer
• Clear focus on customers needs with dedicated
propositions
• Easy tariff mechanism (S, M, L)
• Customer care package (specialist hotline and field
service)
• Focus on positive customer experience