Comptel/ASCENTFebruary

17, 2005

Tom SugrueVice President

Government AffairsT-Mobile

Why Wireless Is Important Major Telecom PlayerMajor Telecom Player Wireless vs. Wireline:Wireless vs. Wireline:

- 180 Million Subscribers vs. 180 Million Switched 180 Million Subscribers vs. 180 Million Switched End User LinesEnd User Lines

- 1 Trillion Minutes of Use Annually vs. 432 Billion 1 Trillion Minutes of Use Annually vs. 432 Billion Interstate Switched Access Minutes AnnuallyInterstate Switched Access Minutes Annually

- $100 Billion Revenues vs. $100 Billion ILEC $100 Billion Revenues vs. $100 Billion ILEC Revenues and $10-20 Billion CLEC RevenuesRevenues and $10-20 Billion CLEC Revenues

What’s Important to T-Mobile Independent Wireless Carriers’ Intercarrier Independent Wireless Carriers’ Intercarrier

Compensation Reform Principles: Compensation Reform Principles: - Should generate incentives for all carriers to become Should generate incentives for all carriers to become

more efficient, cost effective and competitivemore efficient, cost effective and competitive- Should be based on a single, integrated scheme for all Should be based on a single, integrated scheme for all

traffic – interstate, intrastate toll and local – and for all traffic – interstate, intrastate toll and local – and for all types of carrierstypes of carriers

- Should be non-discriminatory, technology-neutral and Should be non-discriminatory, technology-neutral and administratively simpleadministratively simple

What’s Important to T-Mobile Independent Wireless Carriers’ Intercarrier Independent Wireless Carriers’ Intercarrier

Compensation Reform Principles Compensation Reform Principles (cont.):(cont.):- Should eliminate arbitrage opportunitiesShould eliminate arbitrage opportunities- Should be based on true universal service considerations, Should be based on true universal service considerations,

not on “make whole” funds designed to replace existing not on “make whole” funds designed to replace existing revenue flowsrevenue flows

- Should focus on benefits to consumers, not on Should focus on benefits to consumers, not on guaranteeing the revenues of incumbent carriersguaranteeing the revenues of incumbent carriers

Similar Principles Put Forth by CTIASimilar Principles Put Forth by CTIA

What These Principles Mean Ultimately Reach Bill & Keep After a Ultimately Reach Bill & Keep After a

Reasonable TransitionReasonable Transition Carriers Recover Costs from Their Own Carriers Recover Costs from Their Own

CustomersCustomers Universal Service Should Not Be Universal Service Should Not Be

Revenue ReplacementRevenue Replacement