Growth drivers

Domestic Market

• Introduction of a new operating business model, protecting the value of connectivity whilst increasing the free cash flow generation. It will imply the progressive development of an all-IP network in support of new services and able to ensure better performances on fixed and mobile lines, at a lower cost
• Focus on the mobile broadband, which in the last few years has been, and will increasingly be in the future, the main strategic and commercial opportunity for the mobile telecommunications industry, able, probably, to offset the erosion in some of the traditional components of revenues such as voice and messaging
• Alongside the innovative services which are already established and in their full growth phase, such as mobile broadband, there are various other market areas with significant medium term growth potential, for example: mobile advertising, mobile content (e.g. social networking), mobile payment and location based services etc.
• Improvement of the technical quality and spread more and more a quality culture so as to improve the customer satisfaction index and to facilitate the loyalty; 
• Partnership with Top Player IT and selective development of emerging vertical markets (e-health, e-gov, finance, security/monitoring, automotive).

Brazil

• Continuous population and GDP growth, development of social and economic dynamics and telecommunications market growth: this is the scenario in which Tim Brasil will operate over the next three years, trying to broaden penetration in market segments in which it is present, the “usage” of products and services and the data business development
• Intelig acquisition has ensured the Brazilian group an important asset to compete in the fixed market: an integrated backbone and the possibility to better negotiate transport contracts, backbone and backhauling access with other operators (Telemar, Embratel, GVT)
• The recent acquisition of AES Altimus (July 2011) - a telecommunications infrastructure operator in the states of San Paolo and Rio de Janeiro - will enable TIM Participações to reinforce development of its mobile network thanks to fibre optic connections (so-called backhauling) between transmission stations (allowing it to extend and accelerate mobile broadband services), and to benefit from synergies through the internalisation of AES' access infrastructure, avoiding the need to rent connections from third party operators
• Customer satisfaction, thanks to a complete and well-structured offer, good network coverage and quality service, is the means to gain customers loyalty and reduce as much as possible the migration to other operators (churn).
  

Argentina

• The telecommunications market in Argentina and Paraguay continues to feature strong demand for new services and higher access speeds, in an environment which is highly competitive in the various business segments
• Personal (which operates in Argentina as a mobile player), as the first in the country, has experimented fourth generation mobile (4G) services on a Long Term Evolution platform, achieving connection speeds of up to 50 Mbps
• Moreover, Personal will address the important challenges associated with the introduction of Number Portability in Argentina at the end of 2011
• Nucleo, in Paraguay, has adopted a new pricing strategy aimed at improving customers’ perceptions and has strengthened its offering of 3G mobile internet services

The development of guidelines identified within the strategic plan, both in the domestic market and LatAm, cannot be separated from:

• constant monitoring of activities carried out by Telecom Italia’s competitors
• on-going and constructive dialogue with the Regulatory
• introduction and development of alternative technologies for the mobile telecommunications sector, also alternative of those currently in use.