LifeTel

Connecting people 2010 Strategic Plan

2010 Life Telecommunications Networks. All rights reserved.

VISION and MISSION

VISION

To connect the life of the people in South Africa through the best communication services

MISSION To be number one choice telecommunication provider in South Africa through providing the best quality and more value added services across the country using advanced technologies
2010 Life Telecommunications Networks. All rights reserved.

Strengths and Weakness

Internal Strategic Factors 1 Strengths
New Advanced Network (3.5G)
Wide Coverage Area Innovation leadership, Strong commitment to world class governance principles Good Executive leadership

Weight 2
0.15
0.15 0.05 0.05 0.10

Rating 3
5
4 5 3 4

Weighted Score 4
0.75
0.60 0.25 0.15 0.40

Comments 5

Weaknesses
Limited brand awareness Limited Fixed coverage Minimum market experience Recruiting expert employees 0.15 0.10 0.10 0.15 4 4 3 5 0.60 0.40 0.30 0.75

Total score

1.00

2010 Life Telecommunications Networks. All rights reserved.

Opportunity and Threats

Internal Strategic Factors Weight Rating Weighted Score Comments

2
0.15 0.05 0.05 0.10 0.15

3
5 4 4 3 4

4
0.75 0.20 0.20 0.30 0.60

Opportunities
Low data penetration Low Fixed Line penetration Economic Growth Strong NGO base Stable political landscape

Threats
High unemployment rate Many players High Interconnection costs Low income population 0.15 0.15 0.05 0.10 4 3 4 3 0.60 0.45 0.20 0.30

Total score

1.00

2010 Life Telecommunications Networks. All rights reserved.

SWOT Analysis
Strategic Factors S1New Advanced Network (3.5G) S2 Wide Coverage Area W1 Limited brand awareness W2 Recruiting expert employees O1 Low data penetration O2 Stable political landscape T1 Many players T1 High unemployment rate Weight Rating Weighted Score Short Medium Long Notes

0.15 0.15 0.15

5 4 4

0.75 0.60 0.60

X X

0.20 0.15 0.15 0.15 0.15

4 5 4 3 4

0.80 0.75 0.60 0.45 0.60

X X

X X

2010 Life Telecommunications Networks. All rights reserved.

2010 Strategic Plan Market Segment Attractiveness

Business Unit Strength High Medium Low An evaluation of the of market segment attractiveness pits us in the prepaid segment and data services. We have high business strengths In these areas and the driving force is our ability to steal market share in the prepaid segment
Prepaid segment

Market Attractiveness

High

Medium

Low

Postpaid segment Data services segment

2010 Life Telecommunications Networks. All rights reserved.

2010 Strategic Plan Competitive Positioning

Reducing the Bargaining Power of Suppliers Partnering Supply chain management Supply chain training Increase dependency Build knowledge of supplier costs and methods Take over a supplier Reducing the Treat of New Entrants Increase minimum efficient scales of operations Create a marketing / brand image (loyalty as a barrier) Patents, protection of intellectual property Alliances with linked products / services Tie up with suppliers Tie up with distributors Retaliation tactics Reducing the Competitive Rivalry between Existing Players Avoid price competition Differentiate your product Buy out competition Reduce industry over-capacity Focus on different segments Communicate with competitors Reducing the Bargaining Power of Customers Partnering Supply chain management Increase loyalty Increase incentives and value added Move purchase decision away from price Cut put powerful intermediaries (go directly to customer) Reducing the Threat of Substitutes Legal actions Increase switching costs Alliances Customer surveys to learn about their preferences Enter substitute market and influence from within Accentuate differences (real or perceived)

2010 Life Telecommunications Networks. All rights reserved.

2010 Strategic Plan Corporate Strategy

S/ N 1

Strategy

Strategic Objective
To attain a 10% of the prepaid Market share by middle of 2011

MEASURE

Growth Strategy

Network coverage of 50% in the first year and 100% by the end of the first 3 years To achieve a Revenue target $100m in the first year and an average year on year growth of 10%

2010 Life Telecommunications Networks. All rights reserved.

2010 Strategic Plan Business Unit Strategy

S/ N 1

Strategy

Strategic Objective Rollout 3.5G network by the end of the first year and Wimax by the end of 2nd year

MEASURE

Launch wide range of products and services portfolio

HSDPA by 1st year (on launch) Wimax services by end of 2nd year Prospector/Offensive Video Telephone and conferencing by 3rd year Strategies. Low cost Launch 4G Iphone in the 4th year National and International roaming services by 1st year provider Superior voice services over advanced 3.5G network by first year Seamless interconnectivity with other networks

Wider distribution channels than rivals by launch date.

20% owned stores 80% partners stores

2010 Life Telecommunications Networks. All rights reserved.

2010 Strategic Plan Implementation Plan

Strategic Goal Growth by Market Penetration Strategy Growth Objective To attain a 10% of the prepaid Market share by middle of 2011 Network coverage of 50% in the first year and 100% by the end of the first 3 years To achieve a Revenue target $100m in the first year and an average year on year growth of 10% Rollout 3.5G network by the end of the first year and Wimax by the end of 2nd year Launch wide range of products and services portfolio Wider distribution channels than rivals by launch date Responsibility Marketing Time End 2010

Growth by Market Develop

Growth

Network Group

End 2012

Growth by Market Development, Market Penetration and Product Development

Growth

Marketing Network Sales

2010 Ongoing

Aggressive network rollout

Prospector

Network

2010 2012

Prospector by Product development Offensive

Marketing Network Sales

2010 - 2012

Aggressive channels rollout

Offensive

2010

2010 Life Telecommunications Networks. All rights reserved.

2010 Strategic Plan Key monitoring and control tools

Balanced Scorecard

KPIs by Functional unit Financial EBITDA Margins Network Peak Busy Hours, Network quality Marketing Market Share, Churn% , Brand preference, CSI Sales Sales contracts/Sales closed Monthly Financial reports Auditing Quarterly business review

2010 Life Telecommunications Networks. All rights reserved.