24/11/ INDUSTRY OVERVIEW OF CEE EU MEMBERS European enlargement and ICTs. IDATE Foundation’s Seminar. November 24, Stan Szuder Lucent Technologies CEE

24/11/ Lucent Fast Facts Chairman and CEO: Patricia Russo Headquarters: Murray Hill, N.J. USA 32,300 employees (6/30/04) Key operating units: –Integrated Network Solutions (INS) –Mobility Solutions –Lucent Worldwide Services (LWS) World-renowned Bell Labs has more than 9,500 scientists and engineers engaged in research and development in 10 countries around the world, including the United States billion Lucent shares outstanding (6/30/04) New York Stock Exchange ticker symbol: LU

24/11/ Lucent in EMEA Europe, Middle East And Africa 5,000* employees 46 locations in 20 countries 7 Bell Labs locations 2 manufacturing locations 70 Market Advantage Business Partners 2 Customer Briefing Centers COUNTRIES WE’RE ACTIVE IN: Germany - R&D Centres Italy - IN Competence Centre Spain - R&D Competence Centre Russia - R&D Centre, Repair Centre United Kingdom - Wireless Comp.Centre Netherlands - 3R&D Centres Saudi Arabia France - R&DCentres(ON,UMTS,SW) Belgium Portugal Ireland - R&D Centre Poland - R&D, System Integration Centre Czech Republic - office Slovakia Hungary Romania Bulgaria Lithuania Latvia Estonia Slovenia Croatia Serbia Ukraine Kazakhstan Switzerland Turkey others

24/11/ Lucent in CEE – basic information  In most countries Lucent built activities since 1990  AT&T/Lucent made major investment in several CEE countries  Full range of Lucent products and services portfolio is implemented in CEE countries  The biggest deployment covers Switching (5EES), CDMA, DWDM, SDH, Network Management Solutions, BBA (Stinger, AnyMedia)  Lucent is very active in implementation of new technologies and services (IMS, UMTS, EV-DO, Applications, Professional Services, Managed Services, etc...)  In several CEE countries Lucent is the main supplier of specific technology domain like: DWDM, Broadband Access, Switching, Network Management Solutions  In most cases Lucent is selling end-to-end solutions  TL 9000/ISO 14001/ITCS/UL Compliant and Certified

24/11/ Source: EITO 2004 Bulgaria Czech Estonia Hungary Latvia Lithuania Poland Romania Slovakia Slovenia CEE ICT Spending 5% 17% 2% 15% 2% 3% 38% 9% 5% 4% 2003: Euro B (graph) 2004: Euro B ICT Spending (M Euro) Bulgaria Czech Estonia Hungary Latvia Lithuania Poland Romania Slovakia Slovenia CT IT CEE ICT Investment CEE ICT Investment

24/11/ CEE Overview – countries supported Countries with direct support Countries with indirect support

24/11/ The Competitive LandscapeOwnership of Operators 100% TELE2 (SE) 100% TELE2 (LV) TELE2 (EE) FRANCE TELECOM (FR) 47% TPSA (PL) PTK CENTERTEL (PL) 66% 34% ORANGE (RO) ORANGE (SK) 68% 64% TELENOR (NO) PANNON GSM (HU) MOBILKOM AUSTRIA (AT) VIPNET (HR) 80%100% RADIOLINJA (EE) ELISA COMMUNICATIONS (FI) 75% SI.MOBIL (SLO) 100% STRATEGIC INVESTOR FIXED-LINE INCUMBENT MOBILE OPERATOR KEY TELIA SONERA (SE/FI) LAT TELEKOM (LV) LIETUVOS TELEKOMAS (LT) EESTI TELEFON (EE) 49% 60% 49% EMT (EE) 49% 23% 49% LMT (LV) WHOLESALE OPERATIONS IN PL, HU, BALTICS 20% POLKOMTEL (PL) VODAFONE (UK) TDC (DK) 20% VODAFONE HUNGARY 84% BITE GSM (LT) 100 % 20% MOBIFON (RO) VODAFONE ALBANIA 83% VODAFONE GREECE 65% DEUTSCHE TELEKOM (DE) MATAV (HU) HRAVTSKI TELEKOM (HR) SLOVAK TELEKOM (SK) 51% 59% HTMOBILE (HR) 51% T-MOBILE (CZ) 67% WESTEL (HU) 100 % 51% EUROTEL BRATISLAVA (SK) PTC (PL) MAKTEL (MK) 43% WHOLESALE OPERATION S IN PL, HU, CZ. PRAGONET (CZ) 100 % MOBIMAK (MK) TELEKOM SRBIJA (SERBIA) OTE (GR) 35% ROMTELECOM (RO) GLOBUL (BU) 100% COSMOROM (RO) COSMOTE (GR) AMC (ALBANIA) 100% 84% 20% TELEKOM SRBIJA (SERBIA)

24/11/ Key Operators and Partners in CEE

24/11/ Partners : 11 (+1) –Microlink Latvia (Baltics) –Fima Lithuania –Complus Czech Rep –Vegacom Czech Republic –BGS Slovakia –Kapsch Czech Rep/ Hungary –Sprint Poland –Veracomp Poland –UCS Romania –Smartcom Bulgaria –Iskra Slovenia ( Balkans) –Networkstar Croatia Software Partners: Probell, Schoeller,Sprint,Sun CEE BUSINESS PARTNERS Countries : 15 ( +3 regions) Offices : Warsaw & Prague

24/11/ Lucent CEE Full Set of Activities MAIN ACTIVITIES Factory, Order Desk HR, LRE, IT, CFO Project Management t Sales and Contract management Services Marketing and presales Purchasing R&D and Technical Support

24/11/ Lucent competence areas located in CEE  Over 500 employees, with offices in Poland and Czech Republic, and project offices as needed, cooperation with local subcontractors  Factory in Bydgoszcz providing switching, access and CDMA 450 systems for the European market and beyond  R&D organization in Bydgoszcz provides software solutions for 5ESS® switching system and AnyPath® messaging platform for countries around the world  Lucent Worldwide Services organization providing end-to-end service portfolio (Technical Support Services, Network Deployment Services, Professional Services, Managed Services)  Bydgoszcz provides engineering services for the whole EMEA region  Training centre in Bydgoszcz provides technical training courses for the region and beyond  Poland is responsible for processing orders for all EMEA customers  CEE Lucent has the highest Customer Loyalty Index in Europe

24/11/ Lucent R&D in Poland - Bydgoszcz Software development for Lucent customers worldwide –170 software and telecom professionals, added 50 staff in 2004 –End-to-end project responsibility including project managment, requirements, development, testing and field support –Devolopment support 24x7 Product Portfolio –5ESS™ Switch –AnyPath™ Unfied Messaging System –Software Technology Center Others – More than 50 software engineers outsourced – Strong and long term relationship with Universities – Global certificat TL 9000

24/11/ BYDGOSZCZ KWIDZYŃTCZEW KLADNORAJECKO TATABANYA TIMISOARA Lucent Technologies Manufacturing Partners Located in CEE Lucent TechnologiesPolandSp. z o.o. –Jabil–KwidzynPoland,Hungary PCB Assembly& Manufacturing; System Assembly, TechnologyServ. –CelesticaRajeckoandKladnoin Czech Republic, PCB Assembly; final assembly, test, configuration, repair&distribution –Solectron–Timisoara, Romania,PCBAssy(high volume / low mix) –Flextronics–Tczew, Poland&SarvarHungary–cables, FAT, cell phones –Sanmina-Tatabanya, Hungary graphic cards, mother boards, ADSL modems, base station cards

24/11/ METALS PLASTICS CABLES COMPONENTS ASSEMBLY BODY SHOP PACKAGINGWAREHOUSING INTEGRATION CP’sEXPORT/IMPORT/ECCN Bydgoszcz – Poland Supply & Service Campus – Outsourcing Model

24/11/ Opportunities for Telcos and Vendors Telcos –Clear opportunities in the provision of international services either through direct presence or a partnership strategy –There are a number of potential targets for strategic investment with alternative fixed-line operators focussing on the corporate sector being the most attractive Vendors –Infrastructure investment by telcos is beginning to pick up after the slump –Mobile operators will continue to invest heavily in IT as they roll-out new messaging and data services and further improve custom service –Large-scale investments in mobile infrastructure are unlikely in the near term –Fixed-line infrastructure investment is being directed towards broadband access and IN solutions

24/11/ Thank you. Questions?