1. www.idate.org Europe is moving on… Yves GASSOT General Director, IDATE

2. www.idate.org Europe is moving on… 2 Europe Is moving on… From the TMT bubble to the telecoms crisis… Fiber redundancy (particularly in the US) International investment frenzy (Europe; operators and equipment suppliers) UMTS false start (wrong schedule, overvaluing of licences, over-abundancy of licences, lack of applications development,…)

3. www.idate.org Europe is moving on… 3 Europe Is moving on… Loss of trust in telecoms for investors Dramatic fall of stockvalues Halt in IPO Debt burdens + depreciation Bankruptcies Drop in Capex Return the national market (Telecom Italia, BT, …), spin-offs (O 2 /BT) … and consolidation

4. www.idate.org Europe is moving on… 4 Europe Is moving on… However the telecoms sector is not… in the same situation as the coalmines in the 70’s Graphique World Telecoms Market Source: IDATE

5. www.idate.org Europe is moving on… 5 Europe Is moving on… Of course, fixed telephony is decreasing… Source: IDATE

6. www.idate.org Europe is moving on… 6 Europe Is moving on… However mobiles are still a growing segment: 12% for the year 2002 in Europe Source: IDATE

7. www.idate.org Europe is moving on… 7 Europe Is moving on… … the Internet segment (ISP revenues + POTS revenues + « always on » supscription) is also a very efficient growth vehicle: +50% for 2002 Source: IDATE

8. www.idate.org Europe is moving on… 8 Europe Is moving on… Beyond the tragic impacts of the telecoms crisis, we should note that : 1. The demand for communication services still exists 2. Innovation remains one of the telecom industry’s major strengths 3. The crisis is the result of teething problems in an industry which has suddenly left the comfortable cradle of the monopoly… to become the central issue of the stock market gamble 4. … and which has still to make its mutation, 20 years after the revolution made by the computing sector…

9. www.idate.org Europe is moving on… 9 Europe Is moving on… … and finally, what we propose during this conference is to discuss this transformation, with a set of questions starting with specific points moving on to more general issues: Does Europe still have the mobile lead? High speed: is it the next growth engine for telecom? Do we have the correct regulation? Is Europe ready for the rebound? Should we forget the convergence strategy? And finally… What is Europe’s competitive advantage?