Telefónica International Wholesale ServicesCorporate Overview and P4P Working Group

Telefónica Internacional Wholesale ServicesEstrategia y Desarrollo NegocioJanuary 2009

P4PWG

2Telefónica International Wholesale ServicesEstrategia y Desarrollo Negocio

01 Telefónica Group Relevant Data

02 Telefónica Wholesale Relevant Data

03 Mission and Vision

04 IP Network

05 P2P and P4PWG

Index

3Telefónica Wholesale

The Value Proposition of Telecomunications Today: Stay close to the customer and in the center of all new business models

4Telefónica Wholesale

Accesses Jun/07

01

Presence in 23

countries

220.000 employees

Telefónica is one of the largest telecom’s operators in the world…

5Telefónica Wholesale

Fuente:Bloomberg. EMC. Company Data

01

…having climbed the rankings in the last few years…

4thCompany by

market cap in the Telecom´s sector

6Telefónica Wholesale

Telefónica Spain

Telefónica Latin

America

Telefónica O2 Europe

01

…and has become a key player in sector consolidation

Latin America

Accesses 126 MM

Revenues € 18.1 Bn

Europe

Accesses 39.2 MM

Revenues € 13.2 Bn

Spain *

Accesses 49.3 MM

Revenues € 19.8 Bn

* Medi Telecom Included

Strategic Alliance & acquisition of 5% of

China Netcom

Acquisition of an indirect participation of

Telecom Italia (42,3% of TI’s

controlling vehicle which owns 23,6% of

TI)

9,9% of Portugal Telecom

The Corporate Centre defines the strategy and the corporate policies

7Telefónica Wholesale

126 MM accesses

Presence in 15 countries

136,000 employees

Revenues: ~ € 18.1 Bn

OIBDA: ~ € 6.6 Bn

OpFCF: ~ € 3.9 Bn 1º Fixed

1º Mobile

1º BB

1º Fixed

1º Mobile

1º BB

1º Fixed

2º Mobile

1º Fixed

1º Mobile

1º BB

2º Mobile

2º Fixed

1º Mobile

1º BB

1º Mobile

Telefónica in Latin America 2007

Leader in Brazil, Argentina, Chile, Peru & Colombia

01

In Latin America, Telefónica is the leader in 5 markets => #1 in 56 % of Latam GDP

8Telefónica International Wholesale ServicesEstrategia y Desarrollo Negocio

01

The Investment in Latin America has resulted in a continuous growth of customers and services

Mobile

Fix

Broadband

Paid TV

9Telefónica International Wholesale ServicesEstrategia y Desarrollo Negocio

01

10Telefónica International Wholesale ServicesEstrategia y Desarrollo Negocio

Telefónica Wholesale belongs to the Telefónica Latinoamerica Group also with Terra

02

Telefónica Latino America

Telefónica de España

Telefónica O2 Europe

Telefónica International Wholesale Services

International services for Carriers

Main support subsidiaries

Telefónica R&D

T-GestionaFundación Telefónica

Terra - ISP

Telefónica Contenidos

11Telefónica International Wholesale ServicesEstrategia y Desarrollo Negocio

Terra Overview Terra Networks is a global Internet media company under

the Telefónica Group Terra operates some of the most popular websites in the

United States, Latin America and Spain, with over 45 million monthly unique users worldwide.

Terra is also the largest access/broadband provider in the Spanish and Portuguese-speaking world market.

Terra.com is the U.S. arm of the Terra Networks group, providing unique, comprehensive content and value-added services to the US Hispanic market. Key industry leaders, such as Comcast, Cars.com, Azteca America, Editorial Televisa, CONCACAF, and others, partner with Terra to provide the best in news, sports, music and entertainment to our loyal audience.

Terra is a leader in the US Hispanic online market, according to comScore Media Metrix and Nielsen/NetRatings.

· Argentina· Brasil· Chile· Colombia· Costa Rica· Ecuador· EEUU· El Salvador· España· Guatemala· Honduras· México· Nicaragua· República Dominicana· Panamá· Perú· Puerto Rico· Uruguay· Venezuela

Terra Shorts: a fresh, new way to experience Latino Films.

02

12Telefónica International Wholesale Services

Telefónica International Wholesale Services is the leading telecommunications’ wholesale provider in the Spanish and Portuguese-speaking markets...

02

Footprint

Main markets in Europe and America

Main markets in Europe and America

455 people in 11 different countries

455 people in 11 different countries

Coverage in more than 230 countries through

agreements

Coverage in more than 230 countries through

agreements

International Voice

Direct routes to more than 150 carriers

Direct routes to more than 150 carriers

13.000 M carried minutes13.000 M carried minutes

Mobile and fixed traffic termination

Mobile and fixed traffic termination

Business excluding voiceWholesale Capacity, IP

Transit, Data and Clearing House services

Wholesale Capacity, IP Transit, Data and

Clearing House services

TIER 1 IP BackboneTIER 1 IP Backbone

Best Data Network capillarity in the region

Best Data Network capillarity in the region

Assets

State of the art International network

State of the art International network

2 International Control Centers and 40 PoPs in

18 countries

2 International Control Centers and 40 PoPs in

18 countries15 landing stations

> 45,000 km fiber optic network

15 landing stations

> 45,000 km fiber optic network

13Telefónica International Wholesale Services

...operating in those countries where the Group is present and accessing more than 400 destinations …

02

14Telefonica International Wholesale Services

... with a whole Portfolio of Services …

•International Transit

•International Termination

•Advanced and Value Added Services

•International VoIP

•Signaling•Operator Assisted

•Freephone•Country Direct

•International Transit

•International Termination

•Advanced and Value Added Services

•International VoIP

•Signaling•Operator Assisted

•Freephone•Country Direct

•Internet Transit

•GRX

•MMS Relay

•Internet Transit

•GRX

•MMS Relay

IPIP

•SDH/SONET•Backbone Bandwidth

•City to City

•Wavelength•Backbone Wavelength

•City to City

•Private Networks

•SDH/SONET•Backbone Bandwidth

•City to City

•Wavelength•Backbone Wavelength

•City to City

•Private Networks

CapacityCapacity DataData

•Carrier Frame Relay

•Carrier ATM

•Carrier Clear Channel

•Carrier IP MPLS

•VPN IP Sec

•Carrier Frame Relay

•Carrier ATM

•Carrier Clear Channel

•Carrier IP MPLS

•VPN IP Sec

VoiceVoiceVSATVSAT

•VSAT IP• VPN• Internet• Backup

•GSMoSatellite• Backup• Ampliación de cobertura

•BGAN

•Single Channel per Carrier

•Sat. Broadcasting

•VSAT IP• VPN• Internet• Backup

•GSMoSatellite• Backup• Ampliación de cobertura

•BGAN

•Single Channel per Carrier

•Sat. Broadcasting

02

15Telefónica International Wholesale Services

... and a wide customer base...02

16Telefónica International Wholesale ServicesEstrategia y Desarrollo Negocio

Telefónica Wholesale Mission within Telefónica Group

03

Telefonica Wholesale

Integrated management of Telefonica Group’s international wholesale business along with its supporting network

• To gather inbound international traffic, providing a single interface for international carriers wherever the Group has presence

• Act as the Group’s International carrier to meet all the international traffic needs

• Supporting the Group’s broadband strategy by meeting its growth demand

• Maximize return on existing assets (Opex and Capex management) fostering the Group’s synergies

• Provide global scope to the new mobility services, VoIP and broadband

Telefonica Latinoamérica

Telefónica O2 Europe

T. Deutschland

Telefonica de España

International Wholesale Business

17Telefónica International Wholesale ServicesPlanificación Estratégica y Recursos

International IP Network04

Taking advantage of technological evolution

Taking advantage of technological evolution

Single international NGN

Common and integrated processes

Unified platform provides integrated management and operation of the voice business

Single international NGN

Common and integrated processes

Unified platform provides integrated management and operation of the voice business

Santiago Buenos Aires

Sao Paulo

New York

MadridMiami

LIMA

CDRs Mediation

VASENUM

LCRPrepaid

VoIP Networks

VoIP Networks

ToIP Networks

ToIP Networks

Multimedia IMS networks

Multimedia IMS networks

VoIP Networks

VoIP Networks

ToIP Networks

ToIP Networks

Multimedia IMS networks

Multimedia IMS networks

Accelerated Growth Accelerated Growth

International IP traffic

Broadband users Growth and new acquisition

International IP traffic

Broadband users Growth and new acquisition

18Telefónica International Wholesale ServicesPlanificación Estratégica y Recursos

The P2P – both a threat and opportunity

Source:TIWS Madrid: Dec 2003

Bandwidth-hungry application is P2P traffic…

…which will continue to grow with more premium content

05

19Telefónica International Wholesale ServicesDesarrollo de Negocio y Estrategia

P4P TIWS Team

Telefónica International

Wholesale Services

MarketingMarta Garcia

Monica Martinez Quero

Business DevelopmentEmilio SepulvedaAdriana FreitasAntonio Santos

NetworkIn each country

Legal Department

Telefonica R&DPablo Rodriguez

Georgos Siganos Nikolaos Laoutaris

05

20Telefónica International Wholesale ServicesDesarrollo de Negocio y Estrategia