2. Examining how KPN has achieved flexible billing for their Prepaid Services Mieke van Kalker, Product Responsible for Prepaid Wednesday 26 th September 2004

3. 2 Outline of presentation KPN Mobile: Who are we? The Mobile Market in the Netherlands Replacement of the Prepaid platform Keeping up with Marketing requirements Questions?

4. 3 Who are we? More than 45 million voice minutes per day 15.5 million customers KPN Mobile Strategic partner 1.450.000 i-mode customers 5735 employees More than € 5 billion revenue in 2003 Status 9 augustus 2004

5. 4 The Netherlands Market share 39.3% Subscribers 5.41 mln Penetration85 % KPN Mobile Division 5 Belgium Market share 16% Subscribers 1.44 mln Penetration 79 % Germany Market share 12.9% Subscribers 8.71 mln Penetration 82 % Status 9 august 2004

6. 5 The Mobile market in the Netherlands One of the most competitive markets 5 network operators, 6 brands A lot of (emerging) WholeSale / MVNO parties, e.g.

7. 6 Market share Prepaid customers KPN Vodafone 22,8% Telfort 8,9% T-Mobile 12,8% Orange 13,9% 41,6% Ultimo August 2004 Total prepaid base: 8,7 million Ultimo December 2003 Total prepaid base: 7,8 million

8. 7 Replacement of the Prepaid Platform Why replacement? –The Market demand requires a great amount of flexibility in our ICT environment, both from a technical and functional point of view –Existing platform is end –of -life Selection proces –Telecom Suppliers –Billing suppliers –Convergence with postpaid billing Complexity –More than 20 interfaces –More than 3,5 million customers –Many different services

9. 8 Replacement of the Prepaid Platform Project New Prepaid –Goal is to replace the current PrePay infrastructure with the Alcatel OSP PrePay solution before the end of 2004 –Minimal service interruptions –Seamless migration of current services and customer base

10. 9 ICT architecture Bill Calculation EBP Real-time Call/ session control PrePay CDR / event -Mediation Service Mediator Content GPRS SMSC MMSC MSC (Voice) Service Domain Customer CRM and Marketing Product Management Product Network Domain Bill payments HLR Rating Customer Management PostPay Real-time Rating Management Reporting Finance Banks Billing data, Account balance

11. 10 Migration Migration in Q4 2004 –Migration of vouchers –Migration of subscribers –Migration of data/ MMS amount Keep the services running at all time

12. 11 Marketing in a highly competitive market More than 10 brands, fighting for customers New ideas, giving away minutes/ SMS Price war on SMS Validity of Prepaid Balance New services, especially on Value added Services

13. 12 Speed of technical changes Market demands a quick reaction at all times Technical changes take time Challenge to align these two opposites –Explain technical constraints –Be closely involved with new ideas –Suggests possibilities from technical point of view

14. 13 Loyalty pograms Prepaid customers are a challenge to keep –They have no contract –Change very quickly –Price is important –New Prepaid cards come with new mobile phones Possible solutions –Reward high value customers –Keep new services coming –Always stay ahead of the competition

15. Prepaid in the Netherlands: a fascinating service Any questions?