SFR FTTH

1
SFR FTTH

• Idate FTTH Workshop
• November 18, 2009

2
FTTH Network Sharing Model Depends on Population
Density
Fibre
ADSL
?
?
5M to 10 M households Other large cities
5 M households Paris and suburbs, main French
cities
10M to 26 M households Small towns and rural areas
SFR Position
Main parts of Paris, Lyon, Marseille covered gt
50K Homes Connected
Competition Framework

• Full infrastructure competition between FTTH
  operators

• Horizontal network sharing necessary to lower
  network to sustainable level

• Public Subsidies unavoidable for FTTH

• Vertical Network sharing in building

• Horizontal and vertical Network sharing
• Ensuring fair competition between incumbent and
  new entrants

• Conditions for network sharing and subsidies

Regulatory Issues
3
FTTH Launch Must Take Into Account High Existing
ADSL Triple Play Penetration
4
Advantages of FTTH Services vs ADSL
FTTH has great advantages over ADSL, and has the
potential to cover the future needs of our
customers and increase Service ARPU

• Speed and abilité to provide very high bandwidth
  services
• HD TV with no constraints on distance vs ADSL
  central office
• Services Innovation network backup and restore,
  gaming, connected home, communication services
• Simultaneous usage of different services
• Reliability Fiber more reliable than
  DSLIndependence from the incumbent operators
  network

5
Agressive SFR Triple Play FTTH Offer at Launch

• Agressive pricing equal to ADSL Triple Play to
  ensure rapid migration of SFR ADSL customers and
  increased market share
• Additional innovative services to increase ARPU

Exclusivité Fibre
Internet 100 Méga
Option Multi-TV 5 / mois
Jusquà 4 décodeurs pour regarder la TV HD sur
toutes les TV du foyer
Musique
Télévision HD
Téléphone illimité vers les fixes
avec tout le Service SFR Installation à domicile
incluse
6
Current Issues in FTTH Roll-Out
1
Horizontal Network Network roll out in sewers and
ducts in main cities Main priority for 2009 End
2009 80 of Paris, Lyon, Marseille covered
2
Vertical Network Fiber network inside the
building. Requires a vote by the home owners in
the annual co-owners meetingMain stumbling block
for network roll out today Priority for 2010
3
Individual Home Connection Connection of the home
to the FTTH operators network. Requires the
visit of a technician. gt50K FTTH home
connections in 2009 Priority customer
experience, cost of connection
7
Local Administrations are Key Promoters of FTTH
Coverage in Non Dense Areas

• SFR subsidiary LD Collectivités has established
  partnerships with several public local and
  regional administrations for ADSL and FTTH
• A uniform FTTH network and partnership model must
  still be defined with ARCEP to avoid fragmentation

8
Main Regulatory Issues Remaining

• Several months experience of Vertical Network
  sharing between existing SFR / Orange /
  Numericable buildings will enable operators to
  increase connection volume
• Improvements to the France Telecom duct access
  offer are still necessary
• To enable higher volumes, faster roll outs
• To lower access charges that remain prohibitive
• Multi-fibre regulatory framework in very dense
  areas still remains to be clarified with the
  regulator and with the FTTH operators
• In lower density areas regulatory framework
  must be defined, allowing increased network and
  investment sharing