cote nyc 11 16 06

Wireless Sales - Impact of Holiday Season : 

Wireless Sales - Impact of Holiday Season Michael Cote, Consultant GLG Institute Thursday, November 16, 2006 Yale Club, New York

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Michael Cote was most recently Vice-President of Business Sales and Operations at T-Mobile (8/05). Presently, he is an independent consultant to wireless service providers focused on enterprise mobility, sales & distribution strategy, online strategy, smartphones, and customer care & billing. Mr. Cote has over fifteen years of sales, marketing, and operational experience in the telecommunications industry. Under his leadership, T-Mobile was recently awarded the J.D. Power and Associates award for highest business customer satisfaction in the wireless industry. He was also the recipient of the “Stevie” award from Forbes Magazine and the Miller Heiman organization for Best Sales Team in America. Prior to joining T-Mobile he was one of the founders of Bazillion, the nation’s first carrier to offer consumers voice over IP and broadband services. During his tenure Bazillion became the fastest growing Internet service provider, by doubling sales for thirteen consecutive months.

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Table of Contents What will the impact be? Who will benefit? How will enterprise sales be affected?

Activations Seasonality: 

Activations Seasonality

Activations Seasonality: 

Activations Seasonality Note: Q4 Projection by Cote & Assoc.

Readiness Timeline: 

Readiness Timeline April -June Finalize lineup PO’s issued July - August Handset pricing & promotion rates set Dealer Pre-Orders Nat’l Retailers pre-order & campaigns finalized Online campaigns developed October – November 15 Dealers frontload inventory Additional kiosks deployed in malls All new products and rate plans are launched Media campaigns launch Sell, sell, sell! Black Friday – New Year’s

Holiday Schedules: 

Holiday Schedules Extended hours begin the weekend before Thanksgiving. Vacation black out in all departments Mandatory overtime for Retail, Dealer, Telesales channels Territory reps mandatory weekends in dealer stores

Competition Heats Up: 

Competition Heats Up Carrier corporate owned retail compete against dealers Carriers add kiosks in high traffic areas for holiday season Shopping Bag Sabotage = False Churn

Indirect / Dealer: 

Indirect / Dealer Q3 Pre-order handset pricing Deeply discounted pricing (20-30% off regular dealer pricing) Dealers commit to inventories in August Orders must be place by October 15 Inventory frontloaded by November 15 Carrier reps in dealer stores on weekends

National Retail: 

National Retail Competition for space on the plan-o-gram Media buys complete by August Radio TV Print/Circulars Product release dates, pricing and rate plans available for copy development at least 6 weeks in advance.

Business SMB – Enterprise - Government: 

Business SMB – Enterprise - Government Decision makers are IN Spending what’s left in budget Employee programs mirroring retail promotions drive IL transactions Government spending on new budgets Can be the best month of the year Worst month of the year Nobody is in the office Misconceptions Reality

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Nokia: Flagship Stores Launched Q2-2006 Focus on major shopping districts New York City (2 locations) Chicago (2 locations) Online store Sub-dealer for LetsTalk.com Offering Cingular, Sprint, T-Mobile, Verizon Wireless, US Cellular Manufacturers Sell Direct

Manufacturers Sell Direct: 

Manufacturers Sell Direct Motorola “Robotic-Stores” Launched 9/06 in Chicago With or without activation 12 phones + 18 accessories Online store Offering Verizon Wireless through inPhonic

On-Line Holiday Shopping: 

On-Line Holiday Shopping Source: comScore Networks

Search Engine Marketing: 

Search Engine Marketing 32,408 search on the Term “wireless phone” in Sept ‘06 Top 5 Maximum Bids WireFly $5 Cingular $1.33 CellularChoices.net $1.32 LetsTalk.com $1.29 CompUSA $0.90

Search Engine Marketing: 

Search Engine Marketing

Phones as Gifts: 

Phones as Gifts Challenges of gift giving Contracts – Everyone has one Monthly bills Carriers don’t offer gift cards for features or services How do you give phones as gifts? Existing users: Upgrade to new handsets Stocking stuffers: Accessories, iTunes gift cards, Handango gift cards New Users: Seniors Kids/teens

Seniors Want Simplicity: 

Seniors Want Simplicity Jitterbug Phones Two models: Dial and One Touch (emergency) Screens bright and easy to ready Big buttons Sound is loud and clear Limited features Services Phonebook set up and management Operator assisted calling if needed Rate plans Low minutes, low price

Capturing the Kid Market: 

Capturing the Kid Market Disney may be the biggest winner Family friendly programs Included features Family MonitorTM Family LocatorTM Family AlertTM Call ControlTM Disney ZoneTM Parents on contract with other carriers can manage these features via the web

Carriers’ Entry in Kid Market: 

Carriers’ Entry in Kid Market Sprint Family Locator Parents & children must have compatible phones Parents require data feature in addition to child’s locator feature Cingular Firefly kid-phone Mom & Dad pre-set call buttons Pick Your Plan: Pre-paid monthly, no overages T-Mobile’s kidConnect $19.99, unlimited MTM Works on all phones Verizon LG Migo Kid friendly design Chaperone capable Choose any rate plan

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BlackBerry Pearl Trend for Q4-2006: “Smartphone” Adoption by Consumers SmartPhone shipments expected to rise 66% to 81 million in 2006 Shipments in 2007 may account for 12% worldwide Smartphone Markets Enterprise Small-Medium Business (SMB) Prosumer Consumer

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Q & A

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Gerson Lehrman Group Contacts Nick Goodman Vice President Gerson Lehrman Group 850 Third Avenue, 9th Floor New York, NY 10022 212-750-1878 ngoodman@glgroup.com Christine Ruane Senior Product Manager Gerson Lehrman Group 850 Third Avenue, 9th Floor New York, NY 10022 212-984-8505 cruane@glgroup.com

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