International Bandwidth Trends Internet 2 ITF Meeting April

International Bandwidth Trends Internet 2 – ITF Meeting April 24, 2006 Peter Barletto Sylvie La. Perrière www. vsnlinternational. com

Toward optical cable build-out madness § The internet tsunami takes everybody by surprise. § The magic potion of DWDM : by the year 2000, cables of 1000 times the capacity of previous generation were being installed. § Deregulation, easy access to capital, advances in laser and fiber technology, early players gain high valuations and spectacular internet growth creates a new generation of global cable builders: Global Crossing, Level 3, FLAG , 360 networks, Tyco and results in a cornucopia of transmission capacity. § Internet folly: myth that traffic will double every 90 days forever. § Capacity prices plummet: Trepidation § Capacity providers go under www. vsnlinternational. com

The big build out of the early 2000’s § § § Starting shot was given by Atlantic Crossing (AC 1) which came on-line in May 1998 and TPC-5 on the Pacific side in December 98. Level 3, Global Crossing, FLAG, 360, TGN networks emerged as the major new generation cable builders. The final achievements were the terabit level C&W Trans. Atlantic cable and the Tyco Trans. Pacific cable; both came on line early 2003. The Atlantic has 4 terabit level cables, the Pacific one A trinity of East-Asia terabit level cables : EAC, C 2 C and APCN 2 and a North Asia terabit loop: FNAL/RNAL www. vsnlinternational. com

Could there be some oversupply? The gap between lit and design capacity Very few cable builds likely for the rest of the decade, less willingness to expand lit capacity before demand www. vsnlinternational. com

Lit capacity versus demand § Cost to activate all major unlit capacity is high: § transatlantic capacity (9. 6 Tb) is estimated at $3. 5 bilion and $3. 9 billion transpacific (7. 9 Tb) and $12 billion intra Asia (15. 6 Tb). (source: Telegeography 2005) § Some additional lit capacity likely needed in 2006 -2007 § Better equilibrium between supply and demand www. vsnlinternational. com

Predictions and forecasts revisited § What will fill the capacity and how fast? § Current (2005) transatlantic: voice: 13. 3 Gb internet 773. 2 Gb; other (IPL etc): 62. 5 Gb § Tele. Geography predicts for end 2007: a slow growth scenario of 1, 570 Gb a fast growth scenario of 1, 955 Gb § This still leaves ample capacity but who would dare this time around to predict it will take 17 years to fill the cable? § Internet represents approx 85% of all transoceanic capacity use and has seen renewed growth (32% in 2004, 52% estimate for 2005). § How fast will internet traffic soak-up excess? Any new international bandwidth hungry internet applications in sight? § Bandwidth prices still keep dropping but at a slower rate—is price stability coming? www. vsnlinternational. com

Toward gigabit connectivity § First transatlantic gigabit level circuit : § 2001: 2. 5 gig SURFnet to Chicago Starlight § First transpacific STM-4’s § 2001: two Transpac STM-4’s § 2002: first transatlantic 10 gb § Surfnet leads again § The big R&E scare of 2002: § KPNQwest disappears, Teleglobe reorganizes § Global Crossing, L 3 and Tyco become major lambda providers www. vsnlinternational. com

Continued Technological and Deployment Progress § 40 G technology coming (? ), § Router Ports exist - $$ § Terrestrial DWDM available but - $$ § Subsea possible but final development, impact to ultimate capacity, and costs are issues. § More options on interfaces in undersea equipment (Gig. E, 10 Gig. E) § Interest in filling in gaps in undersea footprint, prices still high in some parts of the world. § Suppliers becoming more customer and cost focused www. vsnlinternational. com

Global Network www. vsnlinternational. com

www. vsnlinternational. com

Dual stack IPv 4 and IPv 6 access on 21 access nodes in 15 countries (March 2006) www. vsnlinternational. com

Network Reach | Leveraging Major Infrastructure Ownership § 100% owner in 3 cable systems (Trans-Atlantic, Trans-Pacific, Singapore-Chennai) § Leading investor in another 3 cable systems (Sat 3/Safe, SMW 3 and SMW 4) § 206, 356 km of global connectivity § Trans-Atlantic and Trans-Pacific data transfer capacity of 1 trillion bits per second § SDH & SONET to support IP, ATM, Gigabit Ethernet § Diverse redundancy and protection capabilities § Greatest diversity to, and within, India. www. vsnlinternational. com

VSNL India Footprint | Diverse Connectivity to and from India § NLD Backbone § 40, 000 Route Km covering 300 major cities § Pan India Coverage with dual line maintenance § Comprehensive Cable Redundancy § Capacity on all cables coming into India § Ring Architecture for redundancy § Most vibrant domestic network in India § SMW 4 § Network Administrator § One of the largest Investors § Tata Indicom Cable § 100% VSNL Owned and Operated www. vsnlinternational. com

Major Cable Investments | Tata Indicom Cable (TIC) § Newest and Highest Capacity Cable System into India (320 GBPs) § Offers Hardware and Wavelength Protection on Wet Segment § Deep Shore-end Burial § Ring-Protected Backhaul in Singapore § Leading SLAs for Service Availability § Linked Directly to VSNL’s Redundant Network in India § Onward Connectivity from Singapore to Hong Kong, Tokyo, and USA www. vsnlinternational. com

Trans-America | Network Capacity § City-to-City Connectivity to: § § § Seattle Hillsboro (x 2) Portland New York City (multiple locations) Los Angeles Santa Clara Portland Seattle Miami § Full Range of Service Offerings including: § § To Tokyo DS-3, STM-1 through STM-64 Wavelength Services Fiber Plans Ethernet Services New York (x 2) Wall Twp (x 2) Santa Clara (x 2) Los Angeles (x 2) Miami www. vsnlinternational. com To London

European | Network Capacity § European Ring § Supports > 64 10 Gb/s waves per fiber pair § City-to-City Connectivity to: § § § Full Range of Service Offerings including: Hunmanby Groningen London (x 2) To New York Amsterdam Highbridge (x 2) Frankfurt (x 2) Paris Bilbao Lisbon www. vsnlinternational. com Madrid London Paris Amsterdam Frankfurt Groningen § § DS-3, STM-1 through STM-64 Wavelength Services Fiber Pairs Ethernet Services

SMW- 4 | Asia to Europe Segments 4 3 § VSNL Network Administrator § 16 -member Consortium § Hosts Mumbai-based network operating center § 1. 28 Tera bits per second design capacity § connecting 3 continents over 20, 000 km § Initially equipped with 160 Giga bits bandwidth (DWDM technology) § 640 Gigabits matrix Digital Cross Connect in every station 2 ALCATEL FUJITSU ALCATEL AND FUJITSU www. vsnlinternational. com 1

Trans-Pacific | Network Capacity § 8 Fiber Pairs Cable § Supports 96 10 Gb/s waves per fiber pair Seattle Hillsboro (x 2) Portland Santa Clara (x 2) Tokyo (x 2) Toyohashi Emi Maruyama Los Angeles (x 2) § 8 Fiber Pairs Per Cable Ring § Supports 64 10 Gb/s waves per fiber pair § City-to-City Connectivity to: § 8 Fiber Pairs Cable § Supports 96 10 Gb/s waves per fiber pair Guam § § § Portland Seattle Los Angeles Santa Clara Tokyo § Full Range of Service Offerings including: § § www. vsnlinternational. com To New York DS-3, STM-1 through STM-64 Wavelength Services Fiber Plans Ethernet Services

Japan & Pacific Region | Interconnectivity § Regional Network Interconnectivity § § § § FLAG North Asia Loop (FNAL) Reach North Asia Loop (RNAL) FLAG Eur-Asia C 2 C Cable Network Asia Netcom (ANC) APCN-2 Australia Japan Cable (AJC) § Japan Interconnectivity § § § TGN On-Net Locations TGN Interconnect Points www. vsnlinternational. com Powered Com (PWD) NTT-E NTT-C KVH Tepco

C 2 C| Fiber Pair § § § www. vsnlinternational. com Single Fiber Pair in 8 -pair system On “Main Ring” 960 Gbps of ultimate capacity

Company Overview www. vsnlinternational. com

The new VSNL International § Two complementary acquisitions … § November 1 st 2004: VSNL India announces purchase of Tyco Communication assets; July 1 st 2005: deal completed § July 25 th 2005 : VSNL announces purchase of Teleglobe; February 14 th 2006: deal completed. § … give VSNL international unparallelled capabilities § Today TGN represents about 36% of lit Trans. Pacific capacity (73% of design capacity) and 20% of both lit and design capacity under the Atlantic § Teleglobe brings a global IP network, a global voice network, TDM and Vo. IP with 13 billion of voice traffic and global roaming § VSNL International is a leader in Eo. S (Ethernet over Sonet) www. vsnlinternational. com

VSNL International | Tata Group Financial Stability & IT Capabilities Tata Group § 125 -year old largest private sector group § $17. 8 billion in revenues § Acquired VSNL in February 2002 § Tata Consultancy Services (TCS) § Asia’s largest software & systems integration services company § 33 countries across 5 continents § Key player in high-growth international markets www. vsnlinternational. com

VSNL International | Integrating Key Assets VSNL International § § § Global presence with operations the US, Europe & Asia All customer segments, encompassing wholesale and corporate. Presence in voice, data and mobile services markets § § § § Leading international wholesale voice, data & mobile provider Over 1400 wholesale customers & 13 billion minutes 100 Gbps connectivity in nearly 80 cable systems Reach to 240 countries/territories 250 direct and bilateral relationships Major supplier of voice, internet traffic and signaling conversion Wholesale services to over 350 mobile operators Teleglobe TGN § § § 60, 000 kilometers of global sub-sea connectivity spanning 3 continents Bandwidth at all STM/OC levels Reliable, scaleable and fully redundant VSNL § § www. vsnlinternational. com India’s #1 Communications Group Leading provider of International Telecommunications and Internet Services Largest Enterprise, Wholesale and Retail Broadband services footprint 800, 000 strong Internet subscriber base

Our Strategy | The Building Blocks § § § § 17 billion minutes of international voice traffic 415 bilateral agreements ITFS in over 80 countries Ownership in 100+ sub sea and terrestrial cable systems 7. 68 Terabit system across Trans-Pacific, Trans-Atlantic, Intra-Europe 5. 12 Terabit system between Singapore and India Tier 1 ISP with 67 Po. Ps in 21 countries Domestic India network with 37, 000 km of fiber network 122 Po. Ps of MPLS core backbone in India 300, 000 buildings On-net in India 30 major Indian cities on Ethernet MAN network IP backbone of 10 gigabits 39 Data centers and co-location facilities across the world Over 350 mobile customers connected for global roaming www. vsnlinternational. com

Integrated Network Strategy I Next-Generation Capabilities Partnerships and ecosystem Content partners www. vsnlinternational. com Voice peering Network Related Managed Services § N/W Management § Security IMS IP based core network Embedded applications for collaboration, security and built on owned communication infrastructure MPLS-NNI using service mediation technology + + IT Infrastructure Services § Hosting § Storage § DR/BC = Next Generation Network Capabilities

Wholesale Data www. vsnlinternational. com

Wholesale Data | Global Strengths § Tier 1 Global Network § Extensive ownership in over 100 sub-sea and terrestrial cable systems § Scalable bandwidth solutions with effective cost management § Synergy between Teleglobe network infrastructure and scalability of TGN routes § Global Tier 1 ISP with 67 worldwide Po. Ps in 21 countries § Global IP backbone AS 6453 connected to more than 90 countries § IPv 6 leader § Market leader in satellite-based IP services § Diversely routed 10 Gbps and 2. 5 Gbps wavelengths or resilient self-healing SONET/SDH ring infrastructure § Connects ISP and content providers through more than 120 G of peering and 400 G of customer connectivity worldwide. § Greater reach and on-net capacity (EMEA-Africa) § Enhanced service capabilities for hosted applications and managed offerings www. vsnlinternational. com

Wholesale Data | Key IP Services Strengths § Tier 1 international network focused on services for carriers / ISPS § 67 Pops - 60% Outside North America § 435 Customers - 69% of Revenue Outside North America § 1 AS Number, 1 Operating Center - Reputation for Excellent Qo. S § 435 -strong stable customer base § Expansive satellite capability to the developing world § Providing primary or back up service to key growth regions § Unparalleled global reach and local peering § Kuala Lumpur, Manila, Cairo, Riyadh, Sydney, Hong Kong § Middle East IX (MEIX), Egypt IX (EIX) Unique to ASN § Benefit from significant traffic share in several geographies § Canada, India, Spain, France, Middle East, Parts of Asia, Africa § Balanced International Content and Eyeballs § India traffic to enhance global balance § Unique peer-to-peer communities § § Strongly positioned as content becomes more regional Many customers in high growth regions Unique eyeballs Tier 1 peering relationships www. vsnlinternational. com

Wholesale Data | AS 6453 Highlights § Single Global AS § Provides superior connectivity between Middle East and Asia, Europe and Asia and North America and Middle East § Industry Competitive SLAs § Excellent round trip delay (RTD), 0% pack loss, 100% reach § Private Peering With All Tier 1 Carriers § More than 70 Peering Arrangements § 67 Internet Po. Ps in 21 countries Worldwide www. vsnlinternational. com

Wholesale Data | Key IPL Services Strengths § Global Transmission Services § § Fiber (special service ) Wavelength Services Private Line Services Half Circuit Services § Largest owned infrastructure and capacities across the Pacific, Atlantic, Intra Europe and Asia § SEA ME WE 4 Network Administrators and Full Circuit Availability § Ability to provision high bandwidth in short time frames § Round the World Global coverage § Diverse and Redundant routes and service options available § § Unprotected (largely TGN network or single-leg consortium cables) Restored Protected Premium Protected www. vsnlinternational. com

Wholesale Voice | Global Strengths § Global Reach § # 1 wholesale international voice player with combined volume of 17 b minutes § Over 350 direct and bilateral relations with leading voice operators § Largest wholesale international footprint § Hundreds of carrier interconnects provide us with diverse routing, lowest possible costs § Full global coverage enhanced with India-route strengths § Enhanced quality, stability, competitiveness § Value-Add § Global paradigm of exceptional commercial flexibility § Teleglobe systems and tools leveraged across full India portfolio § Customers benefit from faster time to market and lower costs § Automated, adaptive Best. Value Routing. TM enables us to offer multiple service levels with robust quality, aggressive prices, & continuous optimization with lower SG&A www. vsnlinternational. com

Mobile | Global Strengths § Global Leadership § Market leading position with more than 350 GSM operators worldwide § Mobile operators are supported with the Company’s global signaling network, enhanced roaming services, managed mobile content services, and global voice termination § World signaling conversion leadership with Wireless Global Roaming (WGR) § “Translates” between signaling network standards in North America (ANSI) and the rest of the world (ITU) § Comprehensive Services Portfolio § Enhanced full signaling range and scale from Americas/Europe to include Asia signaling anchor § Basic Signaling: to ~400 wireless operators in more than 165 countries. § > 15 billion message signaling units of value-added signaling services § Managed Roaming: Allows operators to assign roaming subscribers to the visited network of their choice § VTS Prime: Mobile call completion with guaranteed caller line identification transport to more than 35 strategic countries § Continuing mission-critical business support § Next-Generation Applications § Additional leading-edge applications offered as a hosted service offering § Push-to-talk on Cellular § IP Multimedia Subsystem(IMS) § International Prepaid Gateway and CAMEL Gateway www. vsnlinternational. com

Global Teams | Local Support § VSNL Singapore Pte Ltd. No. 5 Shenton Way UIC Building #22 -07 Singapore 068808 +65 637 22 574 +65 642 30 315 (Fax) § VSNL Telecommunications (UK), Ltd 5 th Floor, 30 -34 Moorgate London, EC 2 R 6 PJ United Kingdom +44 20 7519 4610 +44 20 7519 4609 § VSNL America, Inc. 2100 Reston Parkway - Suite 320 Reston, VA 20191 USA +1 703 547 5900 +1 703 547 6555 (Fax) § Suite - 7 th Floor 2 Harbour Exchange Square London, E 14 9 GE, England +44 207 519 4610 +44 207 519 4609 (Fax) § VSNL Telecommunications (US) Inc. § VSNL Hong Kong Limited § § 90 Matawan Rd Suite 101 Matawan, NJ 07747 + 1 732 203 3000 + 1 732 203 3003 (Fax) 750 College Road East Princeton, NJ 08540 +1 609 750 3333 +1 609 419 1511 (Fax) § Teleglobe 12010 Sunset Hills Road Reston, Virginia 20190 +1 703 766 3102 (Fax) www. vsnlinternational. com 2402 Bank of America Tower 12 Harcourt Road Central Hong Kong +852 3693 8888 +852 3690 2022 (Fax) Asia-Pacific - Hong Kong 2508 Two Pacific Place 88 Queensway, Hong Kong +852 2530 -8500 +852 2537 7417 (Fax) § Teleglobe 1555 Rue Carrie-Derick Montreal (Québec) Canada, H 3 C 6 W 2 +1 514 868 7272 +1 514 868 7234 (Fax) § VSNL India Headquarters Lokmanya Videsh Sanchar Bhavan Kashinath Dhuru Marg Prabhadevi, Mumbai 400028 India +91 22 5652 6400 +91 22 5652 6401(Fax)

Thank You! www. vsnlinternational. com