1. How to foster investments in the European telco sector? Sverre Holt-Francati, SVP, Telenor Group NMHH Investment/Regulatory Conference, Budapest 4 December 2013

2. Focus for this presentation 1.Review the Telecom Single Market “package” 2.Present and discuss our “wish list” 2

3. Strong regional footprint and positions in Europe and Asia 3 Norway Sweden Denmark Hungary Serbia Montenegro Bulgaria Thailand Malaysia Bangladesh Pakistan India Myanmar #1 #3 #2 #1 #2

4. European Mega Trends 4 AreaTrend Sector ValueEroding market capitalization RevenueProlonged revenue decline despite significant data traffic growth InvestmentLack of investment in high-speed next generation fixed networks Market StructureA highly fragmented telecom market RegulationHarsh regulatory framework despite intense competition CompetitionCompetitive pressure from OTTs squeezing telcos Can the European Commission’s proposal for a Telecom Single Market address these trends and promote investment?

5. What would we (and investors) like to see in the package? European Commission Proposal: EU Single Authorisation Coordination of spectrum use European Access Products Roaming and intra EU calls Net Neutrality Consumer Protection 5 1 2 3 4 5 6 Wish list: Coordination of spectrum use Net neutrality Market structure Level playing field with OTT Deregulation A B C D E

6. What and why (I) Wish ListWhat needs to be done?Why important for investors? 6 Spectrum Coordination Common rules Availability of spectrum Longer license duration Harmonised auction rules Increased predictability Easier to organise pan-European activities Lower auction participation cost Net Neutrality Common rules across Europe Specialized services Reasonable traffic management procedures. Provides clarity on NN rules Properly implemented offers significant new opportunities Level Playing Field Review E-com specific provisions A horizontal review (e.g. tax loopholes) Existing legislation gives OTT- players a competitive advantage A B C

7. What and why (II) Wish ListWhat needs to be done? Why important for investors? 7 Market Structure Shift regulatory focus to dynamic efficiency Review merger rules and guidelines / tests Remove policies of reserving spectrum for entrants. Sufficient infrastructure competition: o <10 mill inhabitants 2 country wide networks and 3 MNOs o >10 mill inhabitants 3 country wide networks and 4 MNOs In many European markets competition is not sustainable Increases scale and scope Paves the way for pan-European players Deregulation Fewer product markets Change scope of geographical markets Use of remedies should be re-evaluated and threshold for price regulation revisited More flexibility Increased incentives to innovate Less uncertainty caused by regulation Commercial returns D E

8. Summary/wrap up/take aways 1.The proposed package will not in the short run be of significant benefit neither for the operators nor the investors or customers 2.Key elements are missing. The European Commission needs to take one step back and look at the major drivers for the industry: –Level playing field –Market structure –Deregulation 3.The best way forward now would be to focus on getting spectrum coordination and net neutrality provisions right and make the single market part of the Telecom Review in 2016 to ensure a thorough, open and transparent process. 8

9. Thank you