FRANCE TELECOMCanadian Markets

Contents

• Wireless Telephone Services in Quebec• Prices of Quebec Telephone Services

• Elasticity of Demand for Wireless Telephone Services• Making Decisions about Pricing for France Telecom

• Competitive Environment in Wireless Telephone Sector• Gaining Market Share through Pricing Strategies

Agenda

• Environmental Scan

• Competitive Analysis

• Elasticity of Demand

• Pricing Recommendations

ENVIRONMENTAL SCAN SWOT | PEST

Strengths • European market leader • Network infrastructure• Focused research and development strategies• Diverse geographical portfolio with strong mobile

telecommunications operations

*www.orange.com/wholesalesolutions.home

Weaknesses • Labor crisis• Concentrated revenue from France • No presence in emerging markets

*www.orange.com/wholesalesolutions.home

Opportunities

*2010 International KPMG comparative study on business locationwww.orange.com/wholesalesolutions.home

Political• Low CRTC presence• Government stimulation • Industry Growth • Industry Consolidation

Economic • 5.8% lower operating costs in QP*• Quebec is maintaining economic growth at 2%

Social • 7.4% increase in subscribers (2010)• 30 M. customers expected by 2015

Technology • 3G and 4G networks• Real-time transactions• Multimedia messaging

Threats

*www.orange.com/wholesalesolutions.home

Political• Government Intervention• Big 3 lobbying for entrant restriction

Economic • Average disposable income in Quebec lower than national • Fragile EU economy (slowdown)

Social • Safety•

Technology • Fast-paced industry• Updated networks• Coverage areas, drop-calls

COMPETITIVE ANALYSIS Leading Competitor Analysis

Service vs. Price Analysis

Market Share & Demand Analysis

Major Competitors • Rogers Wireless• TELUS Mobility• Bell Mobility

• Aliant Mobility • Sask Tel Mobility • MTS Mobility

Bell Mobility

*www.bell.ca/Mobility

• World leader in the communications field • Landline and wireless telephone networks • IP networks and solutions • E-commerce • Systems integration • Directory assistance • Satellite transmission network• High-speed Internet access • Web site hosting • Direct satellite broadcasting

*http://www.investquebec.com/en/index.aspx?page=512

Rogers Wireless

*www.rogers.com/web/link/wireless

• Leading Canadian wireless communications provider • Wireless, GSM/GPRS and analog networks • Serves 7 million+ subscribers • Covers 93% of Canada's population • .

*http://www.investquebec.com/en/index.aspx?page=512

TELUS Mobility

*www.telusmobility.com

• Major national leader in telecommunications industry• Internet Protocol (IP)

• Stands apart with next-generation network

*http://www.investquebec.com/en/index.aspx?page=512

Competitor Plan Differences Price ($)

250 mins∞ SMS or MY5

Free from 9 – 7 40.000.45/minuteActivation Fee; 35

150 mins∞ Texting or MY5

Free after 6 42.750.45/minuteActivation Fee; 30

250 mins∞ SMS or MY5Voicemail

*Free after 9 (1yr)*Free after 6 (2yr)

40.000.40/minuteActivation Fee; 35

Voice Plans

Competitor Plan Differences Price ($)

200 mins500 MB∞ SMS or MY5

Free from 9 – 7 50.000.05/MB0.45/minuteActivation Fee; 35

200 mins500 MB∞ Texting or MY5

Free after 6 52.750.05/MB0.45/minuteActivation Fee; 30

200 mins500 MB∞ SMS or MY5Voicemail

*Free after 9 (1yr)*Free after 6 (2yr)

50.000.05/MB0.40/minuteActivation Fee; 35

Voice & Data Plans

Competitor Plan Differences Price ($)

50 mins Free from 7 - 9 20 /member

400-600 mins1 GB Data

Unlimited UsersFree after 6

105 - 125

- - -

Share Plans

Competitor Plan Differences Price ($)

$15 start-up credit No Monthly Rate 0.30/ Admin0.30/Min0.20/Text

$10 Activation Bonus

Voicemail20% Auto Save

0.75/Mth. (Admin)0.40/Min0.01/Min (WE/8-8)

UNLT. WE/9-7 1/day0.20/Min0.15/text3/MB

Pay-as-you-Go Plans

Market Share

*http://www.digitalhome.ca/2011/04/canada-ends-2010-with-24-5-million-wireless-telephone-subscribers

36%

30%

28%

0% 2% 2%1%

Wireless Telecom Market Share By Subscribers (2010)

RogersBellTelusVideotronSasktel Mobility*MTS Mobility*Wind Mobility*

*Leaches of Bell

PRICE ELASTICITY Demand

Demand

*http://www.digitalhome.ca/2011/04/canada-ends-2010-with-24-5-million-wireless-telephone-subscribers/

Subscribers (in millions) (2010)

Growth (2009-2010)

8.98 466 000

7.24 408 746

6.97 447 000

Demand

• Leading Canadian wireless communications provider • Wireless, GSM/GPRS and analog networks • Serves 7 million+ subscribers • Covers 93% of Canada's population

*http://www.investquebec.com/en/index.aspx?page=512

Demand Elasticity

*Data obtained from an original survey