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2Conditions of 3G PlanningPlanning should meet current standards and demands and also comply with future requirements.Uncertainty of future traffic growth and service needs.High bit rate services require knowledge of coverage and capacity enhancements methods.Real constraintsCoexistence and co-operation of 2G and 3G for old operators.Environmental constraints for new operators.Network planning depends not only on the coverage but also on load.

3Objectives of the PlanningTraffic Forecasting:To measure the demand on targeted marked so as to allow an appropriate growth of the Network.Coverage:To obtain the ability of the network ensure the availability of the service in the entire service area.Capacity:To support the subscriber traffic with sufficiently low blocking and delay.Quality:Linking the capacity and the coverage and still provide the required QoS.Costs:To enable an economical network implementation when the service is established and a controlled network expansion during the life cycle of the network.

4Business PlanningMarketing is responsible the revenue side and must also produce a traffic forecast.The engineering model must translate the traffic forecast into a network plan and generate the capex and opex numbers to be passed to the financial model.The financial model takes in information from marketing, including key metrics, revenue forecast, acquisition costs and capex, opex from the engineering model.MARKETING MODELFINANCE MODELENGINEERING MODEL5Financial modelCapturing all the detail of the customer base dynamics, the financial model allows the most comprehensive and rigorous approach to forecasting the cost base and ultimately a valuation. The financial model outputs are those used by decision makers at board level and the financial community.The presentation pack produced by the financial model provides a complete business case, which takes the reader from an analysis of the population through to a range of valuations.The valuation of the business case is the ultimate objective of the suite of models.6 Business Planning Model Market ForecastModel Engineering Models Network Opex and Capex Forecasts Operational Structure, Distribution Channels, Staffing etc.The model combines inputs from the marketing and the engineering models with operating cost assumptions to forecast the financial statements and free cash flow.Network Capex and Opex ForecastCustomers and Revenue ForecastsOperating Cost Assumptions Profit & LossBalance SheetCash Flow Free Cash Flow in Nominal Local CurrencyAll figures in Nominal Local Currency(Operating Cash Flow less Capital Expenditure)7Marketing ModelHow many customers do we have?How much are they willing to spend?What are our tariffs?Traffic ForecastRevenue ForecastEssentially the question is how many customers are there and what does the mobile operator has to deliver for the money paid by those customers.What kind of Services do we offer?8Cost and Revenue Structure 3G Operators Radio NetworkCost3G Operators Core NetworkCostInternet Connectivity Cost3G Operators Hosting PlatformRevenueEnd User RevenueEnd UserThird Party Revenue9Traffic ForecastingPenetration & total subscribersCustomers, gross adds, churnVoice, data and other source of revenuesUser growth yoy up to maturity of the network.As initial works to measure the required capacity

10Demographic Anatomy of Targeted Market (i-th year!)Total Population100%70% Old Enoughto OwnMobile Phone60% With Sufficient IncomeAddressable Market 42%80% Expresses Interest: Potential Demand 33.6% of Population11Penetration Growth0%10%20%30%40%50%60%1995199619971998199920002001200220032004200520062007200820092010201120122013Penetration of PopulationPotential Demand CeilingThe potential demand assumptions should be linked to changing demographic patterns and changes in income.

The potential demand sets a penetration ceiling, conceptually the maximum potential penetration is the level at which the service life cycle curve reaches its upper limit.

12Growth of Subscribers0%204060801001201995199619971998199920002001200220032004200520062007200820092010201120122013Number of Subsc. (Million)Saturation Level13Traffic Growthe.g voice traffic/user = 27 mErl which comprises 80% of total traffic, Data traffic/user = 10 mErl which is the rest of total traffic. Combined average generated traffic per user is 23.1 mErl. 0%40801201602002401995199619971998199920002001200220032004200520062007200820092010201120122013Offered Traffic (kErl)Saturation Level14The Traffic data from the marketing model drives network dimensioning.Because the model is intended to be used in the business-planning phase, it is essential that a range of scenarios can be evaluated rapidly. The impact of varying, for example, different tariffs can be calculated instantly. The engineering model can run completely in the background so that business planners can run scenarios without recourse to engineering.15The Engineering Model covers capex and opex for 2G and 3G networks.The capex and opex part of the 3G Mobile Toolkit covers the technical aspects, including capital and operational expenditures.The scope of the 3G engineering model includes dimensioning and costing for the following elements: Radio networkCore network & interconnectServer network