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UBS WARBURG
FIFTH ANNUAL GLOBAL TELECOM CONFERENCE
WEDNESDAY, NOVEMBER 15
WILLIAM T. O'SHEA
EXECUTIVE VICE PRESIDENT
CORPORATE STRATEGY & BUSINESS DEVELOPMENT
LUCENT TECHNOLOGIES
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WE'RE BUILDING A NEW LUCENT
- AFTER A TOUGH YEAR, WE ARE UNDERTAKING A MAJOR RE-TOOLING OF THE BUSINESS
- WE'RE DIVIDING FOR LONG-TERM GROWTH
- SPIN-OFF OF AVAYA COMMUNICATION COMPLETED SEPTEMBER 30; AGREEMENT TO
SELL POWER SYSTEMS ANNOUNCED YESTERDAY
- PROPOSED MICROELECTRONICS IPO AND SPIN UNDERWAY
- OUR ISSUES ARE ONES OF EXECUTION, NOT OPPORTUNITY
- THE "NEW" LUCENT WILL BE INTENSELY FOCUSED ON THE GROWING NEEDS OF SERVICE
PROVIDERS
- WITH A DIFFERENT CORPORATE STRUCTURE, STREAMLINED BUSINESS PROCESSES
AND GREATER SPEED
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THE LARGEST NETWORK BUILD-OUT IN HISTORY
- AN ESTIMATED ONE TRILLION DOLLARS WILL BE SPENT WORLDWIDE IN THE NEXT THREE
YEARS ON RE-VAMPING AND BUILDING THE NEXT GENERATION OF INTERNET NETWORKS.
- BROADBAND AND MOBILITY ARE THE KEY GROWTH DRIVERS
- HIGH-SPEED ACCESS LINES TO HOMES AND SMALL BUSINESSES INCREASED 57% TO
4.3 MILLION* DURING THE FIRST HALF OF THIS YEAR
- 26 NEW US WIRELESS USERS EVERY MINUTE
*FCC data based on information filed by U.S. service providers on
9/1/00; includes data as of 6/30/00.
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THE BROADBAND AND MOBILE INTERNET
- LUCENT'S VISION OF THE NEXT-GENERATION NETWORK IS BASED ON DATA, WIRELESS
AND OPTICAL TECHNOLOGY
- PLUS THE SOFTWARE AND SERVICES TO SUPPORT THEM
[graphic]
- WE WILL CREATE AND DELIVER COST-EFFECTIVE NETWORK SOLUTIONS BY COMBINING
OUR STRENGTHS IN:
- INTELLIGENT OPTICAL NETWORKING
- CORE AND METRO MULTISERVICE SWITCHING AND ROUTING
- BROADBAND 3G WIRELESS
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LUCENT IS THE MARKET LEADER IN DATA NETWORKING FOR SERVICE PROVIDERS
- OUR INTERNETWORKING SYSTEMS BUSINESS GAINED A LOT OF TRACTION IN FY-2000
- LUCENT IS NO. 1 MARKET SHARE LEADER IN MULTISERVICE ATM CORE AND EDGE,
REMOTE ACCESS, DSL, VoIP AND FRAME RELAY
- MARKET FOR OUR NEXT-GENERATION PACKET SWITCHING PLATFORM - THE 7R/E - IS
BEGINNING TO MATURE
- LUCENT'S STINGER PRODUCT HAS "CHANGED THE DSL SPACE"
- WE SHIPPED MORE THAN 2 MILLION REMOTE ACCESS CONCENTRATOR PORTS AND 1
MILLION VoIP PORTS
- EACH RECORD AN INDUSTRY "FIRST"
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LUCENT IS A LEADER IN THE MOBILE INTERNET SPACE
- WE'RE NO. 1 WORLDWIDE IN CDMA WITH OVER 40,000 BASE STATIONS INSTALLED
- WE'RE DELIVERING 3G-READY GLOBAL NETWORKS FOR CUSTOMERS SUCH AS CLEARNET OF
CANADA, VERIZON, SPRINT PCS, ONE.TEL AND TELECOM NEW ZEALAND
- WE HAVE AGREEMENTS WITH NET2WIRELESS AND MAPINFO TO DEVELOP 3G
APPLICATIONS
- NEW OCELOT SOFTWARE PROVIDES UNIQUE APPROACH TO INCREASING COVERAGE,
CAPACITY AND SPEED
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MAKING PROGRESS IN OPTICAL NETWORKING
- WE INTRODUCED A COMPETITIVE 10G PRODUCT FAMILY
- WE'VE RE-ORGANIZED THE OPTICAL BUSINESS UNDER NEW LEADERSHIP
- LUCENT IS SEEING STRONG REVENUE GROWTH FOR OPTICAL NETWORKING WITH
INTERNATIONAL CUSTOMERS, INCUMBENT LOCAL EXCHANGE CARRIERS (ILECS) AND
COMPETITIVE LOCAL EXCHANGE CARRIERS (CLECS)
- OUR OPTICAL FIBER BUSINESS GREW 60 PERCENT LAST YEAR
[photo omitted]
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SOFTWARE AND SERVICES DIFFERENTIATE LUCENT PRODUCT OFFERINGS
- TWO-THIRDS OF BELL LABS IS DEVELOPING NEXT-GENERATION SOFTWARE, SUCH AS OUR
LUCENT SOFTSWITCH
- MORE THAN 40 CUSTOMERS HAVE CHOSEN THE LUCENT SOFTSWITCH TO HELP
MANAGE DATA AND INTERNET TRAFFIC
- ORACLE IS INTEGRATING LUCENT KENAN ARBOR/BP BILLING INTO E-BUSINESS
OFFERINGS
- ON THE SERVICE SIDE, WE HAVE CREATED LUCENT WORLDWIDE SERVICES BY
INTEGRATING NETWORKCARE PROFESSIONAL SERVICES WITH OUR SERVICE PROVIDER
NETWORKS SERVICES GROUPS AND GLOBAL CUSTOMER TECHNICAL SUPPORT GROUP
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THE NEW LUCENT WILL BE STRONGER, MORE FOCUSED AND BETTER POSITIONED
- OUR TURNAROUND HAS STARTED AND IS ON TRACK
- PRODUCT PORTFOLIO REVIEW WILL REDUCE REDUNDANCY, FOCUS ON HIGHEST
GROWTH OPPORTUNITIES
- CORPORATE INFRASTRUCTURE CONSOLIDATION WILL INCREASE SPEED AND REDUCE
COST SIGNIFICANTLY
- FOCUSED ON IMPROVED BALANCE SHEET AND CASH FLOW MANAGEMENT
- MARKETING AND SALES RE-DEPLOYMENT WILL ALIGN OUR RESOURCES MORE
CLOSELY WITH HIGH GROWTH OPPORTUNITIES
- SERVICES INTEGRATION WILL PLAY TO OUR CORE COMPETENCIES
- SUPPLY CHAIN MANAGEMENT WILL YIELD COST SAVINGS ACROSS THE BUSINESS
- NEW ORDER MANAGEMENT SYSTEM WILL IMPROVE CUSTOMER INTERFACE
- WE'RE CONTINUING TO INVEST AGGRESSIVELY IN DATA, WIRELESS AND OPTICAL PLUS
THE SOFTWARE AND SERVICES TO SUPPORT THEM
[LUCENT LOGO]
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