3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 1 The German Broadband Access Market Christian Golaszewski, COO

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 2 The German Broadband Access Market Market opportunities BWA SMEs ASP Broadband access technologies CAGR Value proposition Performance Capex/Costs Business Concept Case Study WLL : STAR 21 NETWORKS Network Topology PMP- Licenses in Germany Base Stations Backbone Strategic base: Products Positioning, Strategy, Success Factos, Vision

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 3 Market opportunities

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 4 European Broadband Access Fundamentals German broadband access revenues(1) (US$m) European broadband access revenues(1) (US$m)—2004 Note:1 Refers to broadband internet access only Source:IDC, ,975 3, ,094 2, ,000 2,000 3,000 4,000 5,000 Germany UK France Italy Spain Netherlands Belgium Switzerland Sweden ,552 2,553 3, ,000 2,000 3,000 4,000 5, CAGR 109%

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 5 The SME market opportunity 1999 European SME market (1) 2000 German SME market distribution Source:IFM, Statistische Jahrbuch, AZ Bertelsmann Notes: 1International analysis performed on SMEs with 10–499 employees only 2SMEs with 5–499 employees Germany UK Italy France Spain Number of SMEs (000s) Total SMEs (2) >500 Number of employees Number of SMEs (000s)

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 6 Note: *SMEs and all their regional subsidiaries The German ASP Readiness is calculated by dividing German ASP market size by total German IT spending. Source Ovum March 2000, AZ Bertelsmann, Gartner Group, Andersen Consulting Analysis, EITO The ASP acceptance of SMEs is rising steeply in Germany making it very attractive emerging market segment Low IT Spenders Medium IT Spenders High IT Spenders German SME companies willing to purchase ASP services, 2001 – 2005* CAGR ,1% The ASP market opportunity

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 7 Broadband Access Technologies

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 8 Broadband Access Connections Germany – Broadband Access Connections, Business Customers CAGR

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 9 Medium (licences and roof-rights) Medium High 30 – 35% High (2Mbps – 15Mbps) High WLL High (unbundling) Medium 30 – 35% Medium (384Kbps – 2Mbps) Low DSL Regulatory hurdles Upfront costs Capex requirements Scalability (marginal costs) Potential operating margins Capacity Predictability of service quality Medium (rights-of-way) High 30 – 35% High (>10Mbps) Very high Fibre Value Proposition

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 10 CAPEX/Mbps/Site $0 $100 $200 $300 $400 $500 $600 $700 3 rd gen.2 nd gen.DSLBWAPtPFO Capex/Mbps Access Technology Costs $0 $20k $40k $60k $80k $100k $120k DSL BWA PtP FO Capex per Site $160k 2 nd Generation BWA Fills the Gap Between Fiber and DSL Capex/Technology Costs (Free space laser) 3 rd gen.2 nd gen. (Free space laser)

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 11 Where are we going? 2 M8 M10 M100 M1 G Consumer SOHO SME LE Corporate PtP BWA Radio Copper XDSL Access Speed ATM Ethernet ? WAN LAN Local Loop Customer Segments Technology Fibre & Optical Wireless

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 12 Case Study PMP-WLL STAR 21 NETWORKS The Broadband Solutions Company

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 13 ISP N ISP 1 Basestation IP service platform RFC 1483 (bridged and routed) ATM Server Internet IP BT BT AAL5 ATM WLL ATM STM1 STM4 IP filter routing AAL5 ATM STM4 N*E1 STAR 21 Network ATM WLL STM1 PSTN Server ATM Core ATM Forum UNI/NNI PVC ATM Forum UNI/NNI PVC IP Service Termination UNI/NNI PVC SAP Service Access Point Today’s Service Architecture

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 14 PMP-WLL Licenses in Germany PMP potential: 221 licenses for „Point-to-Multipoint“-radio throughout Germany: 183 licenses for 26 GHz 38 licenses for 3,5 GHz Roof Right Portfolio: 450 locations for base stations Business potential: Coverage of about 60 Million German residents and more than companies Licenses in top urban areas, such as Berlin, Bremen, Dresden, Dusseldorf, Frankfurt, Hanover, Leipzig, Magdeburg, Mannheim, Munich, Nuremberg and Stuttgart

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 15 Base Stations Parameters Radius of 3.5 km at 26GHz, up to 10 km at 3.5GHz Bandwidth per base station up to 384 Mbits downstream up to 288 Mbits upstream Bandwidth per licence 14MHz per 3.5GHz licence 28MHz per 26GHz licence (56MHz in 9 key areas) Up to 144 customers (2 Mbits) per base station Typical base station coverageHighlights

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 16 Rainy Days Case Study: Frankfurt Frankfurt base station coverage STAR 21 NETWORKS offices Plusline (local Frankfurt ISP) Computer Training WebHits Controlware (Customer outside of Frankfurt connected via PTP radio) Availability of Frankfurt base station

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 17 Infrastructure: Backbone Highspeed Fiber-Network to supply all 221 license areas with bandwith close to terabit range 35 Points of Presence (Pops) Example of a breakout point Core Switch, ADM n x E1 Switch Friendly voice carrier switch Core Switch n x E1 Switch IP service platform Router Server Farm Hosting / ASP Router Peering internet Router Friendly voice carrier switch Example of a POP

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 18 Interconnection Set-Up PBX Voice WLL Base Station SAP Backbone STM-1 STM-4 STM-16 E1 CES STM-1 Voice Internet STM-1, 100BaseT Router PC 10BaseT Backbone: ATM: Asynchronous Transfer Mode DWDM: Dense Wave Division Multiplexing Transfer rate up to the terabit range

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 19 Product Roadmap Network- Products Applications Strategy Fixed bandwidth Flexible bandwidth LAN-to-LAN connectivity Frame relay Fixed bandwidth Flexible bandwidth LAN-to-LAN connectivity Frame relay IP-based VPN Voice services Back-up lines IP-based VPN Voice services Back-up lines Voice over IP LANs-/WAN- Management Soft-PBX LANs-/WAN- Management Soft-PBX Network Service Provider solutions Web- development and -hosting solutions Web- development and -hosting ISP + IT Service Provider Standard applications Database server Data back-up Standard applications Database server Data back-up Vertical portals Vertical solutions Video-on- demand Vertical portals Vertical solutions Video-on- demand Day trading centres Business TV Facility management Day trading centres Business TV Facility management ASP Content Provider Business Solution Provider

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 20 Company vision: STAR 21 NETWORKS aims to become one of the leading European providers of data communication, internet and application services for City Carriers, Internet Service Providers (ISPs) and SMEs. Leading edge technology: „Wireless Local Loop” access and a high-performance fiber backbone serve as our technical platform to provide dynamic broadband connectivity and high-value „end-to-end“ services. Competitive advantage achieved by: High quality standards, innovative service solutions, short installation times and low prices. Positioning

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 21 Market entry as Broadband Access Provider Leased Lines and Access Service Focus: Wireless Local Loop (WLL ), „Point-to-Multipoint“-radio (PMP) Partner and provider for City Carriers, ISPs and cable companies Strategy Developing into a Full Service Provider Innovative bundled services for telecommunication and data transfer Building a high-speed fiber backbone and continuously increasing the number of base stations Target group: „small and medium enterprises“ (SME) Positioning as Application Service Provider (ASP) Network computing, ERP-modules, office applications Building a powerful data center for hosting and for providing application services Vertical solutions for specific SME demands

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 22 Leading edge technology: High quality end-to-end services conforming to top security standards Solution oriented services: Products and services tailored to individual customer needs and enhanced by consulting services High-value one-stop-shopping: Innovative bundle of products and IT-services from one supplier Dynamic and individual scalable broadband services: Fast and reliable bandwidth services in Germany and in selected European regions State-of-the-art services: Providing application services of high customer value to reduce IT-costs and to increase our customers‘ competitive power Our success factors

3rd Annual Broadband Wireless World Forum 2001, February , Moscone Center, San Francisco. 23 Our Vision We improve our customers' competitive position by delivering the communication and application solutions of the 21st century. STAR 21 NETWORKS The Broadband Solutions Company