Mobile Service Providers Must Face Reality: New Program Says Revamp Fundamental Assumptions.

Business Editors/High-Tech Writers

SOUTH SAN FRANCISCO, Calif.--(BUSINESS WIRE)--Sept. 19, 2002

RHK and Sound Partners Team up to Deliver Strategic Global

Analysis of the Mobile Communications Market

In their first report, "Desperately Seeking Profitability in the Mobile Industry," RHK and Sound Partners challenge preexisting service provider strategies and business assumptions. The report concludes that many service providers will not achieve adequate profitability if they remain on their current paths. Instead, they must reexamine their businesses to focus on the following issues:

-- Look beyond basic cost reduction strategies to more decisive steps such as mergers, acquisitions, and divestments;

-- Drive strong revenues from non-voice services, rather than looking for elusive killer applications;

-- Move away from market share as the sole priority to focus instead on business efficiency through improved ARPU (average revenue per user) and customer retention;

-- Use scenario planning as a technique to identify strategic options and to correct errant business plans.

The report reveals wide disparities among mobile markets around the world. Huge variations in ARPU, voice and messaging usage, customer churn, mobile web uptake, and license costs show where weaknesses in strategy can be addressed. The mobile industry is far from a homogenous entity: each market has its own strengths and weaknesses, identified in detail in the report.

The joint global Mobile Communications: Services & Profitability program is designed to help network operators and system vendors identify key opportunities in wireless as well as the actions necessary to drive revenues and profitability.

"Sound Partners brings to us an impressive understanding of the mobile industry, having worked firsthand with many leading mobile service providers," says Marc Litvinoff, RHK's President and CEO. "In developing this program we will help our clients identify and clarify the new opportunities that exist in mobile."

"We are excited to team up with RHK on this new program," says Martin Scott, Sound Partners' CEO. "We are bringing to the industry not only strategic mobile analysis but actionable recommendations for success, which service providers and equipment vendors need most in this ultra-competitive landscape."

Together with Sound Partners, RHK has created a world-class team providing unrivalled insight and strategic guidance on business-critical issues in mobile communications. The program, Mobile Communications: Services & Profitability identifies the growth opportunities that exist in mobile and the drivers for revenues and profitability. For more information about this and other RHK services, please contact Mike Mahan, in the United States, at 650/737-9600; Takashi Kimura, in Japan, at +81.3492.1341; George Stojsavljevic, in Europe, at +44.1462.485440; and Jim Kent, for Asia-Pacific, at 650/737-9600.

Sound Partners

Sound Partners provides business-critical strategic support and advice to key decision makers in the world's leading mobile companies. Building on unrivalled global mobile market intelligence, Sound Partners has a track record of increasing profitability through successful strategic change programs and new mobile market initiatives. Sound Partners, based in Cambridgeshire, U.K., is an alliance partner of RHK Inc. For more information, visit www.soundpartners.ltd.uk.

RHK

RHK guides equipment vendors, service providers, and financial institutions in making sound business decisions at every level of the telecommunications value chain. Through subscription programs, strategic advisory support, and consulting services, RHK delivers unbiased, third-party perspectives on the markets, trends, and technologies shaping the global telecom infrastructure. RHK's areas of expertise include: Broadband Access, Communications Semiconductors, Network Traffic, Mobile Communications, Operational Support Systems, Optical Components, Optical Networks, and Switching & Routing. The company also provides Financial and Telecom Economic programs as well as an Executive Strategic Partnership service designed for CEOs. For more information, visit www.rhk.com.