Royal Kpn Nv · EURONEXT:KPN
Royal Kpn Nv — KPN — Investor Day (May 2011)
34 slides from Royal Kpn Nv's investor day presentation, May 10, 2011
Slide 1: KPN Investor Day: Consumer wireless
KPN Investor Day: Consumer wireless Strengthen - Simplify - Grow Marco Visser London, 10 May 2011
Slide 2: Mobile Netherlands - profile
Mobile Netherlands - profile Entering a new era Profitable growth Line in the sand Value play n io ut Br rib an Value st ds Di maximization Customer Lifecycle Customer centricity Cash = king Management Value maximization 2000 2004 2007 2011 2015 Short term cash Best-in-class flow Telfort acquisition
Slide 3: Customer behavior
Customer behavior Traditional mobile voice and SMS are increasingly being substituted by data Example: WhatsApp Attitude and communication behaviors are changing Urgency Low High Emotion Little A lot Time required Little Much Cost Important Less relevant # of recipients Group 1-on-1 Topic Private Bu
Slide 4: Customer behavior (cont’d)
Customer behavior (cont’d) Example of mobile bill of high value customer, before new initiatives 1 e Ill u at iv January 2010 January 2011 str ati tr ve 1 us Ill Handset Handset Nokia N95 8Gb Samsung galaxy S Usage Recent Usage 200 minutes contract 175 minutes 200 SMS renewal 160 SMS 37 Mb data 204
Slide 5: Current trends amongst early adopters
Current trends amongst early adopters Use of applications lead to accelerating decline in SMS & out of bundle revenues (Advanced) smartphone penetration1 18% 18% 19% 18% 18% 30% 28% 18% 20% Growth in outgoing SMS per customer 10% 14% 5% 6% 8% y-on-y Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10 Q2 '10 Q3 '10 Q
Slide 6: Managing changing customer behavior
Managing changing customer behavior Short and long term measures Currently Summer 2011 Medium-term Stabilize ARPU Introduce new data Build options for traditional voice/SMS monetization models, application services increase data pricing monetization • Actively upsell • Offer integrated voice / • Inv
Slide 7: Dutch mobile market outlook
Dutch mobile market outlook Size of mobile market is expected to remain relatively stable Revenue cannibalization Opportunities from mobile from IP substitution data • Mobile VoIP • Tiered data pricing • SMS-replacing apps • Multiple simcards for Dutch mobile market various devices service revenues1
Slide 8: 2015 strategic objectives
2015 strategic objectives Adjusting value strategy to sustain market share in changing market Strategic initiatives Key 2015 objectives Future proof portfolio Successful migration to data • From volume based bundles to integrated data and voice 1 bundles Data VAS1 • Application based and quality bas
Slide 9: Future proof portfolio
1 Future proof portfolio Successful migration to data centric bundles First steps From To • Integrated bundles – Data bundles no longer sold separately Data VAS1 • MB differentiated per bundle SMS • Speed differentiation • mVoIP tariffs • USP per brand Voice + Future steps Voice Data • Application b
Slide 10: Distribution optimization
2 Distribution optimization Improve brand and distribution effectiveness Expand own distribution footprint Leverage niche channels • Expand footprint • Specific KPN brands targeting specific customer groups, e.g. online, cultural – KPN stores from 213 to ~300 • New format – Introduce new KPN XXL exp
Slide 11: Growth opportunities
3 Growth opportunities Leverage capabilities on specific segments and adopt regionalization approach Fixed - Mobile convergence Regionalization/ big cities • KPN as first-mover • Regional sales communication • Converged fixed and mobile portfolio • Regional offers • Proven success in Belgium and Ger
Slide 12: Quality and costs
4 Quality and costs Realize best-in-class customer service Best-in-class service experience Best-in-class network 1 Highest download throughput Best in class CRM and billing 2015 + 2 Lowest percentage of dropped calls Accelerated self service 3 Frontrunner on LTE/ HSPA Reduced service calls Sufficie
Slide 13: Concluding remarks
Concluding remarks Sustain share in competitive and changing market OTT / OEM1 players Value strategy New entrants n io ut Br rib an st ds Di Customer Lifecycle Management Different playing field Different players Future proof portfolio Optimize distribution Develop growth Improve quality opportunit
Slide 14: KPN Investor Day: Consumer wireline
KPN Investor Day: Consumer wireline Strengthen - Simplify - Grow Joost Farwerck London, 10 May 2011
Slide 15: Key messages
Key messages Consumer wireline • Clear strategic initiatives targeting > 45% broadband market share by 2015 • Focusing on increasing number of RGUs • Improving TV and broadband propositions to differentiate from the market • Focus on first class customer service and delivery processes • Expanding th
Slide 16: Consumer wireline - profile
Consumer wireline - profile Managing the market for value k Broadband market Broadband 44% 44% share, % customer 42% 41% • Stable base base and • Declining market share 3% 2.536 2.575 2.576 market 2.402 • Cable key competition 3% share 2007 2008 2009 2010 39% 39% 41% 41% 39% 41% € 32 • Stable to ris
Slide 17: Market context
Market context Moving to triple-play, new TV features increasing need for bandwidth Dutch broadband market evolving towards Promising technical developments enable VDSL triple-play bandwidth increase 6.3 Mbps Min-Max 5.8 6.1 5.5 Avg. > 1Gbps 5.0 35 33 25 27 30-300 18 18-190 18-100 8-20 9-50 150 2006
Slide 18: 2015 strategic objectives
2015 strategic objectives Win broadband market share through successful triple and quadruple-play Strategic initiatives Key 2015 objective Broadband market share • Improve & differentiate proposition on copper 1 and fiber • Converged Fixed-Mobile offering > 45% 41% Step up customer service and provi
Slide 19: Customer proposition improvement
1 Customer proposition improvement Improve and differentiate propositions Superior offers Vision Short term proposition improvements with FttH Enhanced and more Improved quality flexible interface • Faster zapping • Improved image quality A great user experience… Plaatje Content High-end TV Addition
Slide 20: Converged Fixed-Mobile offering
1 Converged Fixed-Mobile offering Benefit from quadruple-play offering KPN uniquely positioned for Taking initiative to increase Fixed- quadruple-play in NL Mobile convergence • Customer benefits from quadruple-play proposition: • Device convergence on TV/BB – Convergence between devices roadmap, su
Slide 21: Customer service optimization
2 Customer service optimization Quality improvements in customer service and efficiency Improvements on First class service points One KPN customer unit customer process • Improved delivery time • Nationwide first class service • 1 customer process broadband / TV points by improving website • 1 prog
Slide 22: Addressable market expansion
3 Addressable market expansion VDSL upgrades and fiber roll-out expanding coverage Actions to expand the addressable market • Upgrades of copper network – Acceleration VDSL outer rings ongoing • Selectively targeted fiber roll-out in promising areas through Reggefiber JV – Pair bonding, full launch
Slide 23: Positive results in KPN FttH areas
3 Positive results in KPN FttH areas Fiber areas show promising uptake in market share and ARPU Broadband market share Good developments in KPN 44% FttH areas 42% 41% 41% Fiber area +3% • Broadband and TV show promising market share uptakes National -1% Dec 2009 Dec 2010 • 40% of broadband gross add
Slide 24: Maximize value through regional approach
4 Maximize value through regional approach Commercial approach differentiated on regional characteristics and likelihood of success Expand offering across all Focus on churn reduction and Grow FttH in attractive area’s brands gross adds increase per area • Offer IPTV and FttH to • Cross-sell TV • Ex
Slide 25: Concluding remarks
Concluding remarks • Clear strategic initiatives targeting > 45% broadband market share by 2015 • Focusing on increasing number of RGUs • Improving TV and broadband propositions to differentiate from the market • Focus on first class customer service and delivery processes • Expanding the addressabl
Slide 26: KPN Investor Day: Germany
KPN Investor Day: Germany Strengthen - Simplify - Grow Thorsten Dirks London, 10 May 2011 26
Slide 27: Key messages
Key messages Germany • Winning challenger strategy for data • Strong growth potential • All building blocks in place 27
Slide 28: Challenger strategy
Challenger strategy Strong performance in competitive German market Proven track record with 2010 ramp-up year for growth in mobile data % = E-Plus service revenue market share ~16% Proven track record 2010: Ramp-up year • Focused on mass market needs • Acquired valuable spectrum • Low-cost to serve
Slide 29: Market context
Market context Overall market size stable due to strong growth in mobile data German market service revenues • Overall service revenue market size stable € bn 20.0 20.0 • Voice market will further decline due to MTA impact and competitive Data 3.5 pricing pressure 6.5 • Substitution of voice/SMS thr
Slide 30: 2015 strategic objectives
2015 strategic objectives Grow mobile Challenger strategy with data Strategic initiatives Key 2015 objective Network • Mobile broadband network for mass market Service revenue • Quality on eye-level with competition market share • Clear cost leadership 2010 Commercial • Innovative value for money da
Slide 31: Mobile data strategy - Network
Mobile data strategy - Network Quality on eye-level with competition - at lowest cost to serve Building blocks Facts • Mobile data network for mass market user 2009 2010 2011 2012+ – Quality on eye-level with competition 2 9 12 >15 – Lowest cost to serve Mobile broadband roll-out: no. of site upgrad
Slide 32: Mobile data strategy - Commercial
Mobile data strategy - Commercial Strong growth potential - value for money data propositions Building blocks Facts • Strong growth potential – Upgrade customer base 18 6.5 – Capture market growth 3.5 5 Voice Data 2010 2015 • Winning smartphone proposition Market share 2010 (%) Data market (€ bn) –
Slide 33: Brand / distribution strategy
Brand / distribution strategy Further strengthen key elements of Challenger model Building blocks Facts Net promotor score Q1 2011 BASE most popular brand BASE • Further strengthen BASE brand +10 – Continue to push brand awareness 0 - -/- 30 – Further increase Net Promoter Score Industry scores • Ex
Slide 34: Concluding remarks
Concluding remarks Germany • Winning challenger strategy for data • Strong growth potential • All building blocks in place 34