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Speaker 7: Christian Dippon of NERA Economic Consulting

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

of NERA Economic Consulting Page 1

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

The Race to Quadruple Play

Christian M. Dippon

The Race to Quadruple Play

Who Will Rule the Telecommunications Kingdom?

Christian M. DipponVice President

Law Seminars International,Advanced Conference on Wireless TelecommunicationsSeattle, Washington

November 8, 2007

Defining the Kingdom

Video

Fixed Video Landline Voice

Voice

Demand forCommunications

andInformation

Fixed VideoWireless Video

IPTV

Mobile VoiceLandline Voice

1

InformationData

Mobile Broadband

Fixed Broadband

Others

VoIP

FMC

E-Wallet

Speaker 7: Christian Dippon of NERA Economic Consulting

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

of NERA Economic Consulting Page 2

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

Network Providers

Introducing the Parties

Content Providers

– Verizon– AT&T– Qwest– Alltel– Embarq

Fixed:

– Verizon Wireless– AT&T Mobility– Sprint Nextel– T-Mobile

Mobile:

– Comcast– Fox– Time Warner

Video:

Yahoo!Google

AOL LLCWalt DisneyTime WarnerViacom Inc.

News CorporationCBS Corporation

Playboy Enterprises

2

– Time Warner– DirecTV– Dish Net

Playboy EnterprisesMTV Networks Company

Who will Rule – Content or Network?

Fixed and cable networks compete, other networks (fixed wireless, wireless) can potentially also compete. There are numerous competing networks. Hence, network are numerous competing networks. Hence, network owners will not rule.

Content providers are offered in bundles. No single content provider rules. Bundles are provisioned competitively – most content is available on all networks. Hence, content will also not rule.

3

Consumers meet demand for telecommunications and information through triple and quadruple play. Hence portfolio competition (rather than content or networks) will shape competition and decide who, if anybody, will rule.

Speaker 7: Christian Dippon of NERA Economic Consulting

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

of NERA Economic Consulting Page 3

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

What Mode Will Prevail?

Mobile will prevail over

Voice

Fixed (fiber) will prevail over

Data

Fixed will prevail over

Video

prevail over fixed

– Increased coverage

– Improved quality

– Lower prices

– Removal of

prevail over mobile

– Lack of killer application

– Bandwidth capacity limitation

– Battery lives

prevail over mobile

– Lack of killer application

– Bandwidth capacity limitation

– Battery lives

4

Forecast: Mobile will dominate voice, while fixed will dominate data and video. This, however, does not remove mobile from data and video as there is strong demand for

mobile data and video.

– Removal of roaming

– Battery lives – Battery lives

Mobile Leaders: Which Player Will Prevail?

Voice

Fixed Wireless

Data

Fixed Wireless

Video

Fixed Wireless

Other Services

FixedVoIP

WirelessVoIP

Bundles

Fixed

Triple Quadruple

Verizon

AT&T

Qwest

Embarq

Net op MNO

Net op MNO

Net op MVNO

Net op MVNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

FiOS Video Cast Mobile TV

Uverse TV Cellular Video

DirecTV JV MVNO

Dish Net JV MVNO

Yes Yes

Yes Yes

Yes MVNO

Yes MVNO

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

MobileAT&T Mobility

Verizon Wireless

Sprint Nextel

T-Mobile

Net op MNO

Net op MNO

No MNO

No MNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

No HSDPA

No HSDPA

Uverse TV Cellular Video

FiOS Video Cast Mobile TV

No Sprint TV

No

Yes Yes

Yes Yes

No Yes

No Yes

Yes

Yes

Yes

Yes

Yes

Yes

No

No

VideoComcast Net op No Coax / Fiber No Full programming No Yes No Yes No

5

Cox

Time Warner

DirecTV

Dish Net

Net op MVNO (Pivot)

Net op MVNO (Pivot)

No No

No No

Coax / Fiber MVNO (Pivot)

Coax / Fiber MVNO (Pivot)

Satellite No

Satellite No

Full programming MVNO (Pivot)

Full programming MVNO (Pivot)

Full programming No

Full programming No

Yes Yes

Yes Yes

Yes No

Yes No

Yes

Yes

No

No

No

Yes

Yes

No

No

Voice Leaders: Verizon, AT&T, Sprint

Speaker 7: Christian Dippon of NERA Economic Consulting

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

of NERA Economic Consulting Page 4

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

Data, Video Leaders: Which Player Will Prevail?

Voice

Fixed Wireless

Data

Fixed Wireless

Video

Fixed Wireless

Other Services

FixedVoIP

WirelessVoIP

Bundles

Fixed

Triple Quadruple

Verizon

AT&T

Qwest

Embarq

Net op MNO

Net op MNO

Net op MVNO

Net op MVNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

FiOS Video Cast Mobile TV

Uverse TV Cellular Video

DirecTV JV MVNO

Dish Net JV MVNO

Yes Yes

Yes Yes

Yes MVNO

Yes MVNO

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

MobileAT&T Mobility

Verizon Wireless

Sprint Nextel

T-Mobile

Net op MNO

Net op MNO

No MNO

No MNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

No HSDPA

No HSDPA

Uverse TV Cellular Video

FiOS Video Cast Mobile TV

No Sprint TV

No

Yes Yes

Yes Yes

No Yes

No Yes

Yes

Yes

Yes

Yes

Yes

Yes

No

No

VideoComcast Net op No Coax / Fiber No Full programming No Yes No Yes No

6

Cox

Time Warner

DirecTV

Dish Net

Net op MVNO (Pivot)

Net op MVNO (Pivot)

No No

No No

Coax / Fiber MVNO (Pivot)

Coax / Fiber MVNO (Pivot)

Satellite No

Satellite No

Full programming MVNO (Pivot)

Full programming MVNO (Pivot)

Full programming No

Full programming No

Yes Yes

Yes Yes

Yes No

Yes No

Yes

Yes

No

No

No

Yes

Yes

No

No

Data, Video Leaders:Comcast, Cox, Time Warner

(later Verizon and AT&T)

Overall Leaders: Which Player Will Prevail?

Voice

Fixed Wireless

Data

Fixed Wireless

Video

Fixed Wireless

Other Services

FixedVoIP

WirelessVoIP

Bundles

Fixed

Triple Quadruple

Verizon

AT&T

Qwest

Embarq

Net op MNO

Net op MNO

Net op MVNO

Net op MVNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

FiOS Video Cast Mobile TV

Uverse TV Cellular Video

DirecTV JV MVNO

Dish Net JV MVNO

Yes Yes

Yes Yes

Yes MVNO

Yes MVNO

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

MobileAT&T Mobility

Verizon Wireless

Sprint Nextel

T-Mobile

Net op MNO

Net op MNO

No MNO

No MNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

No HSDPA

No HSDPA

Uverse TV Cellular Video

FiOS Video Cast Mobile TV

No Sprint TV

No

Yes Yes

Yes Yes

No Yes

No Yes

Yes

Yes

Yes

Yes

Yes

Yes

No

No

VideoComcast Net op No Coax / Fiber No Full programming No Yes No Yes No

7

Cox

Time Warner

DirecTV

Dish Net

Net op MVNO (Pivot)

Net op MVNO (Pivot)

No No

No No

Coax / Fiber MVNO (Pivot)

Coax / Fiber MVNO (Pivot)

Satellite No

Satellite No

Full programming MVNO (Pivot)

Full programming MVNO (Pivot)

Full programming No

Full programming No

Yes Yes

Yes Yes

Yes No

Yes No

Yes

Yes

No

No

No

Yes

Yes

No

No

Overall Leaders: AT&T, Verizon

Speaker 7: Christian Dippon of NERA Economic Consulting

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

of NERA Economic Consulting Page 5

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

Consolidation and Followers: Which Player Will Prevail?

Voice

Fixed Wireless

Data

Fixed Wireless

Video

Fixed Wireless

Other Services

FixedVoIP

WirelessVoIP

Bundles

Fixed

Triple Quadruple

Verizon

AT&T

Qwest

Embarq

Net op MNO

Net op MNO

Net op MVNO

Net op MVNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

DSL / Fiber HSDPA

FiOS Video Cast Mobile TV

Uverse TV Cellular Video

DirecTV JV MVNO

Dish Net JV MVNO

Yes Yes

Yes Yes

Yes MVNO

Yes MVNO

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

MobileAT&T Mobility

Verizon Wireless

Sprint Nextel

T-Mobile

Net op MNO

Net op MNO

No MNO

No MNO

DSL / Fiber HSDPA

DSL / Fiber HSDPA

No HSDPA

No HSDPA

Uverse TV Cellular Video

FiOS Video Cast Mobile TV

No Sprint TV

No

Yes Yes

Yes Yes

No Yes

No Yes

Yes

Yes

Yes

Yes

Yes

Yes

No

No

VideoComcast Net op No Coax / Fiber No Full programming No Yes No Yes No

8

Cox

Time Warner

DirecTV

Dish Net

Net op MVNO (Pivot)

Net op MVNO (Pivot)

No No

No No

Coax / Fiber MVNO (Pivot)

Coax / Fiber MVNO (Pivot)

Satellite No

Satellite No

Full programming MVNO (Pivot)

Full programming MVNO (Pivot)

Full programming No

Full programming No

Yes Yes

Yes Yes

Yes No

Yes No

Yes

Yes

No

No

No

Yes

Yes

No

No

Consolidations and followers:Qwest, Embarq, T-Mobile, DirectTV, Dish Net,

and smaller players not included above

Key Issues Impacting the Race to Quadruple Play

Net Neutrality (Content Provider vs. Network Operator)

Reclassification of dominant carriers (Verizon, AT&T, etc.) Reclassification of dominant carriers (Verizon, AT&T, etc.)

Video franchising

Spectrum allocation

Skype Motion / Carterphone Rule

9

Mobile TV standards

Attitude to MVNOs / MVNO regulation

General regulatory environment

Speaker 7: Christian Dippon of NERA Economic Consulting

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

of NERA Economic Consulting Page 6

Law Seminars International | Wireless Telecommunications | 11/8/07 in Seattle, WA

Contact UsContact Us

Christian M. Dippon

Vice PresidentSan FranciscoSan Francisco+1 415 291 1044christian.dippon@nera.com

© Copyright 2007National Economic Research Associates, Inc.

All rights reserved.