6 Lessons Learned from the Mobile Industry

1 6 Lessons Learned from the Mobile Industry Commonwealth Digital Broadcasting Switchover Forum 2015. Rostan Schwab, IFC Senior Investment Officer IFC Overview IFC is the member of the World Bank Group focused on the private sector Founded in 1956 with 184 member countries Largest multilateral source of loan/equity financing in Emerging Markets Over $97 Billion Invested Since 1956. AAA-rated by S&P and Moody's Equity, quasi-equity, loans, risk management and local currency products Takes market risk with no sovereign guarantees Promoter of environmental, social, and corporate governance standards Resources and know-how of a global development bank with the flexibility of a merchant bank Holds equity in over 756 companies worldwide across the following sectors: - Agriculture - Financial Markets - Manufacturing Service - Health & Education - Infrastructure - Oil, Gas and Mining - Telecoms, Media & Technology 2.

2 TMT Global Expertise 3. IFC Financing in TMT. Telecoms Media Technology Satellite Infrastructure Data Centers Submarine Cable Applications e/m Payment Systems Wireless/Cellular Content Information Security Fiber Backbones Incubators IT Services Broadband Hardware/Devices Managed Services Towers MVNO's Cross Cutting Venture Investments Greenfield Projects to Corporate Expansions 4. lesson 1: New Technology / Increased Access The introduction of Mobile technology has led to a dramatic increase in access to voice services. In 2014, total Mobile subscriptions amounted to billion, a 93% global penetration. Source: Ericsson Mobility Report, 2014.

3 5. lesson 2: New Technology / New Growth The introduction of Mobile technology has led to a significant growth in the global telecom market, and a switch from developed to emerging markets. 6. lesson 3: A Change in Players Dynamics 1/2. The introduction of Mobile technology has led to a change in players dynamics, with larger players increasingly dominating the space. Source: Delta Partners, 2011. 7. lesson 3: A change in Players Dynamics 1/2. Today, a select club of global titans has emerged together with a strong group of multi- region emerging challengers. And some of the big dormants are waking up. Source: Delta Partners, 2011.

4 8. lesson 4: New Technology / New Devices and New Uses Mobile technology was initially designed for voice services on a cellphone. It is now increasing used for data and with multiple devices (smartphones, tablets, PCs). Source: Ericsson Mobility Report, 2014. 9. lesson 5: Ever-Evolving Business Models The introduction of Mobile technology has led to the emergence of ever evolving business models, seeking to better adapt to the promises of the technology / customer demands. State-Owned Mobile . SOCIAL NETWORKS. Telecom Operator ADVERTISING. Private Mobile OTT. Network Operator E-COMMERCE. COMMUNICATIONS. (MNO). Mobile Virtual INTERNET OF.

5 Network Operator VIRTUALIZATION. THINGS. (MVNO). Independent FINANCIAL. Tower Company SERVICES. Mobile Outsourced Network Operator CONTENT. (MONO). MNO Primary Infrastructure play Etc . Fi. Services Primary digital play 10. lesson 6: the Need for a Rigorous Approach to Investment Despite the overall success of Mobile telephony, a rigorous approach to investment was and still is today required. Below are the main topics of an IFC due diligence. Adequate technology vs Market Size of the market opportunity conditions (ex GSM vs CDMA) ? Competition Track record of the sponsor in managing / investing in similar ventures ?

6 Credibility / Consistency of Business Plan Overall macro-political and regulatory Quality of Management Team environment / Timing ? Environment & Social due diligence Business model ? Existence of successful precedents ? Others Greenfield / Proof of concept /. Established operations ? Replicability ? 11.