Telefónica International Wholesale Services Corporate Overview and P

Telefónica International Wholesale Services Corporate Overview and P 4 P Working Group Telefónica Internacional Wholesale Services Estrategia y Desarrollo Negocio January 2009 1 P 4 PWG

Index 01 Telefónica Group Relevant Data 02 Telefónica Wholesale Relevant Data 03 Mission and Vision 04 IP Network 05 P 2 P and P 4 PWG Telefónica International Wholesale Services Estrategia y Desarrollo Negocio 2

The Value Proposition of Telecomunications Today: Stay close to the customer and in the center of all new business models Telefónica Wholesale 3

01 Telefónica is one of the largest telecom’s operators in the world… Accesses Jun/07 Presence in 23 countries 220. 000 employees Telefónica Wholesale 4

01 …having climbed the rankings in the last few years… 4 th. Company by market cap in the Telecom´s sector Telefónica Wholesale Fuente: Bloomberg. EMC. Company Data 5

01 …and has become a key player in sector consolidation Telefónica Latin America Telefónica O 2 Europe Telefónica Spain Latin America Europe Spain * Accesses 126 MM Accesses 39. 2 MM Accesses 49. 3 MM Revenues € 18. 1 Bn Revenues € 13. 2 Bn Revenues € 19. 8 Bn * Medi Telecom Included The Corporate Centre defines the strategy and the corporate policies Telefónica Wholesale Strategic Alliance & acquisition of 5% of China Netcom 9, 9% of Portugal Telecom 6 Acquisition of an indirect participation of Telecom Italia (42, 3% of TI’s controlling vehicle which owns 23, 6% of TI)

01 In Latin America, Telefónica is the leader in 5 markets => #1 in 56 % of Latam GDP Leader in Brazil, Argentina, Chile, Peru & Colombia ü 2º Mobile Telefónica in Latin America 2007 126 MM accesses ü 1º Fixed ü 1º Mobile ü 2º Mobile Presence in 15 countries ü 1º Fixed 136, 000 employees ü 1º Mobile ü 2º Fixed ü 1º BB OIBDA: ~ € 6. 6 Bn ü 1º Mobile ü 1º Fixed Revenues: ~ € 18. 1 Bn ü 1º BB ü 1º Mobile Op. FCF: ~ € 3. 9 Bn ü 1º BB ü 1º Fixed ü 1º Mobile ü 1º BB Telefónica Wholesale 7

01 The Investment in Latin America has resulted in a continuous growth of customers and services Mobile Fix Telefónica International Wholesale Services Estrategia y Desarrollo Negocio 8 Broadband Paid TV

01 Telefónica International Wholesale Services Estrategia y Desarrollo Negocio 9

02 Telefónica Wholesale belongs to the Telefónica Latinoamerica Group also with Terra Telefónica Latino America Telefónica de España Telefónica International Wholesale Services Telefónica O 2 Europe Terra - ISP International services for Carriers Main support subsidiaries Telefónica R&D Fundación Telefónica International Wholesale Services Estrategia y Desarrollo Negocio T-Gestiona 10 Telefónica Contenidos

02 Terra Overview n Terra Networks is a global Internet media company under the Telefónica Group n Terra operates some of the most popular websites in the United States, Latin America and Spain, with over 45 million monthly unique users worldwide. n Terra is also the largest access/broadband provider in the Spanish and Portuguese-speaking world market. n Terra. com is the U. S. arm of the Terra Networks group, providing unique, comprehensive content and value-added services to the US Hispanic market. Key industry leaders, such as Comcast, Cars. com, Azteca America, Editorial Televisa, CONCACAF, and others, partner with Terra to provide the best in news, sports, music and entertainment to our loyal audience. n Terra is a leader in the US Hispanic online market, according to com. Score Media Metrix and Nielsen/Net. Ratings. Terra Shorts: a fresh, new way to experience Latino Films. Telefónica International Wholesale Services Estrategia y Desarrollo Negocio 11 · Argentina · Brasil · Chile · Colombia · Costa Rica · Ecuador · EEUU · El Salvador · España · Guatemala · Honduras · México · Nicaragua · República Dominicana · Panamá · Perú · Puerto Rico · Uruguay · Venezuela

is 02 Telefónica International Wholesale Servicesthethe leading telecommunications’ wholesale provider in Spanish and Portuguese-speaking markets. . . Footprint International Voice Main markets in Europe and America 13. 000 M carried minutes 455 people in 11 different countries Direct routes to more than 150 carriers Coverage in more than 230 countries through agreements Mobile and fixed traffic termination Business excluding voice Assets Wholesale Capacity, IP Transit, Data and Clearing House services State of the art International network 2 International Control Centers and 40 Po. Ps in 18 countries 15 landing stations TIER 1 IP Backbone Best Data Network capillarity in the region Telefónica International Wholesale Services > 45, 000 km fiber optic network 12

in those 02. . . operatingmore thancountries where the Group is present and accessing 400 destinations … Telefónica International Wholesale Services 13

02 . . . with a whole Portfolio of Services … Capacity • SDH/SONET • Backbone Bandwidth • City to City • Wavelength • Backbone Wavelength • City to City • Private Networks Data • Carrier Frame Relay • Carrier ATM • Carrier Clear Channel • Carrier IP MPLS • VPN IP Sec VSAT • VSAT IP • VPN • Internet • Backup • GSMo. Satellite • Backup • Ampliación de cobertura • BGAN • Single Channel per Carrier • Sat. Broadcasting Telefonica International Wholesale Services 14 IP • Internet Transit Voice • International Transit • GRX • MMS Relay • International Termination • Advanced and Value Added Services • International Vo. IP • Signaling • Operator Assisted • Freephone • Country Direct

02. . . and a wide customer base. . . Telefónica International Wholesale Services 15

03 Telefónica Wholesale Mission within Telefónica Group Integrated management of Telefonica Group’s international wholesale business along with its supporting network International Wholesale Business • To gather inbound international traffic, providing a single interface for international carriers wherever the Group has presence Telefonica de España • Act as the Group’s International carrier to meet all the international traffic needs Telefonica Latinoamérica Telefonica Wholesale • Supporting the Group’s broadband strategy by meeting its growth demand • Maximize return on existing assets (Opex and Capex management) fostering the Group’s synergies • Provide global scope to the new mobility services, Vo. IP and broadband Telefónica O 2 Europe T. Deutschland Telefónica International Wholesale Services Estrategia y Desarrollo Negocio 16

04 International IP Network Vo. IP Networks New York Miami Taking advantage of technological evolution n Single international NGN Madrid To. IP Networks Vo. IP Network s To. IP Networks processes Multimedia IMS networks LIMA Sao Paulo Multimedia IMS networks n Common and integrated Santiago LCR Prepaid CDRs Mediation Buenos Aires n Unified platform provides integrated management and operation of the voice business VAS ENUM n International IP traffic Accelerated Growth Telefónica International Wholesale Services Planificación Estratégica y Recursos n Broadband users Growth and new acquisition 17

05 The P 2 P – both a threat and opportunity Bandwidthhungry application is P 2 P traffic… …which will continue to grow with more premium content Source: TIWS Madrid: Dec 2003 Telefónica International Wholesale Services Planificación Estratégica y Recursos 18

05 P 4 P TIWS Team Telefónica International Wholesale Services Telefonica R&D Pablo Rodriguez Georgos Siganos Nikolaos Laoutaris Legal Department Marketing Marta Garcia Monica Martinez Quero Telefónica International Wholesale Services Desarrollo de Negocio y Estrategia Business Development Emilio Sepulveda Adriana Freitas Antonio Santos 19 Network In each country

Telefónica International Wholesale Services Desarrollo de Negocio y Estrategia 20