Sonaecom informs on 1st quarter 2008 consolidated results

All our businesses had an active quarter in terms of commercial activities with the following initiatives worth highlighting:

• reinforcement of our IPTV offer by adding new broadcast channels and new functionalities;
• replacement of our wireline customers’ set-top boxes, for free, offering one of the most advanced equipments available in the market, which will allow for the improvement of image and sound quality, as well as the rendering of HDTV

The first quarter has highlighted the significant competitive pressures that the Portuguese telecoms market is under, with all of the main operators already active in, or planning to enter, all key segments of the market. The quarter saw new and aggressive offers and promotions across fixed voice, wireline broadband, mobile broadband and TV services including the announcement of the launch of a third satellite TV platform. These developments have gone some way to accelerate the move towards integration and convergence, a trend that Sonaecom has anticipated for some time and is well positioned to take advantage of.

Wireline Business

In the Wireline arena, we have continued to focus on growing the direct access broadband business with particular efforts made to sustain our leading position in the ULL market, expand our double play offering and reinforce our broadband IPTV and Home Video services, while continuously working to improve customer service. Efforts have also been made to transform the acquired indirect customers to direct services, a process that will take time but one that is progressing broadly in line with expectations. The full migration of the acquired Oni and Tele2 customers to our own systems is also in progress but will not be completed until 3Q08.

Services

During 1Q08, through our residential brand Clix, we promoted the replacement, for free, of current customers’ set top boxes for a new MPEG-4 model, one of the most advanced set top boxes currently available in the market, which will allow our TV customers to access HD channels, DTT and to benefit from an improved sound quality.

We have introduced a new entry level of the ADSL offer at 4Mbs and launched new and very attractive promotions for the residential market aimed at reinforcing Clix’s position in the market. Additionally customers with 2Mbs ADSL offers were upgraded to 6Mbs speeds, with no additional cost.

We have also reinforced our IPTV offer by adding new contents, including new broadcast channels such as TVGlobo and World Made Channel, as well as new functionalities: Kids Club (a new portal with design and contents specially adapted to the children’s target) and a parental control tool.

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