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Algeria Telecommunications Market Indicators and Projections

August 2, 2009

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 COMPOUND ANNUAL GROWTH RATE (CAGR)
DEMOGRAPHICS CAGR 04-08 CAGR 09-13 CAGR 04-13

Population (000s) 32,600 33,200 33,800 34,300 34,800 35,310 35,830 36,360 36,900 37,450 1.65% 1.48% 1.55%
Population growth (000s) 520 600 600 500 500 510 520 530 540 550
Population Growth % 1.62% 1.84% 1.81% 1.48% 1.46% 1.47% 1.47% 1.48% 1.49% 1.49%
Number of Households (000s) 4,866 4,955 5,045 5,119 5,224 5,270 5,388 5,509 5,591 5,674 7.83% 26.15% 4.57%
Households growth (000s) 77.61 89.55 89.55 74.63 104.94 45.80 117.82 121.12 81.82 116.00
Household size 6.70 6.70 6.70 6.70 6.66 6.70 6.65 6.60 6.60 6.60

ECONOMY

GDP (US$ Millions) 84,649 98,504 104,307 125,900 159,669
GDP per capita (US$) 2,597 2,967 3,086 3,671 4,588

IT AND INTERNET INFRASTRUCTURE

Number of ISPs (not including Internet Cafes) 34 35 34 35 35 35 35 35 35 36
Internet Accounts (000s) 96 220 355 490 635 785 935 1085 1235 1385 60.37% 15.25% 34.52%
Accounts Added (000s) 26 124 135 135 145 150 150 150 150 150
Internet Accounts penetration % 0.29% 0.66% 1.05% 1.43% 1.82% 2.22% 2.61% 2.98% 3.35% 3.70%

Account usage multiplier (includes Internet café users) 5.5 5.5 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0
Internet Users (000s) 528 1,210 1,775 2,450 3,175 3,925 4,675 5,425 6,175 6,925 56.59% 15.25% 33.11%
Internet Users penetration % 1.62% 3.64% 5.25% 7.14% 9.12% 11.12% 13.05% 14.92% 16.73% 18.49%

Total country Int'l Internet bandwidth Mbps (Utilized) 345 1,400 1,900 3,000 3,835 4,766 5,696 6,626 7,556 8,493 82.60% 15.54% 42.75%
Bandwidth added mbps 1,055 500 1,100 835 930 930 930 930 937
Bandwidth growth % 305.8% 35.7% 57.9% 27.8% 24.3% 19.5% 16.3% 14.0% 12.4%
Internet Bandwidth per Account in kbps 3.59 6.36 5.35 6.12 6.04 6.07 6.09 6.11 6.12 6.13

TELECOMS INFRASTRUCTURE

Number of fixed operators 1 1 2 2 2 1 3 3 3 4
Mainlines (000s) 2,486 2,572 2,841 3,068 3,388 3,638 3,863 4,063 4,238 4,388 8.04% 4.80% 6.52%
Mainlines added (000s) 339.24 86.00 269.30 227.11 319.19 250.00 225.00 200.00 175.00 150.00
Growth % 15.8% 3.5% 10.5% 8.0% 10.4% 7.4% 6.2% 5.2% 4.3% 3.5%
Mainlines Penetration % 7.6% 7.7% 8.4% 8.9% 9.7% 10.3% 10.8% 11.2% 11.5% 11.7%

Residential mainlines % 81% 84% 84% 84% 84% 84% 83% 83% 82% 82%
Household penetration % 41.4% 43.6% 47.3% 50.1% 54.5% 57.6% 59.5% 60.8% 62.2% 63.4%
Residential mainlines (000s) 2,013.66 2,160.48 2,386.69 2,565.19 2,845.59 3,037.40 3,205.96 3,351.65 3,474.83 3,597.83 9.03% 4.32% 6.66%

Business mainline % 19% 16% 16% 16% 16% 17% 17% 18% 18% 18%
Business mainlines (000s) 472.34 411.52 454.61 503.22 542.02 600.20 656.64 710.96 762.77 789.77 3.50% 7.10% 5.88%

DSL / broadband Lines(000s) 36.00 110.00 195.25 300.00 500.00 628.00 794.75 976.50 1148.55 1315.75 93.05% 20.31% 49.16%
DSL / broadband lines Added (000s) 35.920 74.000 85.250 104.750 200.000 128.000 166.750 181.750 172.050 167.200
Growth % 44900.00% 205.56% 77.50% 53.65% 66.67% 25.60% 26.55% 22.87% 17.62% 14.56%
DSL / broadband lines as % of total mainlines 1.45% 4.28% 6.87% 9.78% 14.76% 17.26% 20.58% 24.04% 27.10% 29.99%
DSL / broadband lines as % of total Internet accounts 37.50% 50.00% 55.00% 61.22% 78.74% 80.00% 85.00% 90.00% 93.00% 95.00%

Number of Cellular Operators 3 3 3 3 3 4 4 4 4 5
Cellular Subscribers (000s) 4,882 13,492 20,998 27,563 27,033 29,283 31,283 32,533 33,533 34,533 53.40% 4.21% 24.28%
Cellular subscribers Added (000s) 3,457 8,610 7,506 6,565 -529 2,250 2,000 1,250 1,000 1,000
Cellular Penetration % 14.98% 40.64% 62.12% 80.36% 77.7% 82.93% 87.31% 89.48% 90.88% 92.21%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 COMPOUND ANNUAL GROWTH RATE (CAGR)
REVENUES CAGR 04-08 CAGR 09-13 CAGR 04-13

CELLULAR
Cellular revenues (US$ 000) 1,055,348 1,563,920 2,633,681 3,241,111 3,600,438 3,644,537 3,826,217 3,835,267 3,869,791 3,884,566 35.91% 1.61% 15.58%
Monthly ARPU (US$) 26.7 13.7 12.5 11.0 11.0 10.8 10.5 10.0 9.8 9.5 -19.86% -3.04% -10.83%

© 2009 Arab Advisors Group Reproduction Prohibited

We project broadband accounts share of total Internet accounts to reach 95% by 2013.4 million lines by end of 2013. This report is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. © 2009 Arab Advisors Group Reproduction Prohibited .25% between 2009 and 2013.Population Arab Advisors Group projects Algeria's population and household size to maintain their historical growth levels in the forecast period between 2008 and 2013. The ARTP reported that the drop in cellular subscribers by year-end 2008 was a result of excluding the non-active subscribers from the total market subscribers This report has been delivered to Jawwal-Palestine as part of the subscription to the Arab Advisors Group Strategic Research Service to be used exclusively by its employees. All opinions and estimates included in this report constitute our judgment as of this date and are subject to change without notice. Internet accounts The Arab Advisors Group projects Algeria's Internet market to grow at a CAGR of 15. Disclaimer Although the information in this report has been obtained from sources that Arab Advisors Group believes to be reliable. and such information may be incomplete or condensed.7% Cellular Subscribers The Arab Advisors Group has revised the projections of the cellular market in Algeria downwards due to a record cleaning in 2008. No part of this document may be reproduced without the written permission of Arab Advisors Group. we do not guarantee its accuracy. with a penetration rate of 11. This broadband growth will be the main driver of international Internet bandwidth capacity of the country Mainlines (Fixed lines) The Arab Advisors Group projects mainlines to reach 4.