San Francisco • Toronto • Dallas • Ottawa

The Blunt Edge of American Broadband: the future of the broadband local loop

Gilder/Forbes Telecosm Conference August 2003Yatish PathakChief Executive OfficerSOMA Networks

PROPRIETARY AND CONFIDENTIAL

Profitable Last-Mile Wireless Solution

Reach local markets rapidly & cost-effectively

Reach broadband, voice & application segments

Reach strong ROI

Expanding the Reach of Communications Providers

PROPRIETARY AND CONFIDENTIAL

SOMA Networks – Company Overview

• Milestones– Founded 1998– Over 240 patent applications– December 2001 trials with major operators– March 2002 commercial availability– July 2002 first commercial customer rollout– September 2002 NTT first market deployment– In 2003 the SOMA™ Solution has been deployed

on four continents

• Major Partners– Sharp (CPE)– Solectron (Manufacturing)– Samsung (ASIC)– Qualcomm (CDMA)– SAIC/Telcordia (Systems Integrator)– LCCI (installation and service)

PROPRIETARY AND CONFIDENTIAL

The Blunt Edge:Residential Broadband Local Loop Penetration in America - 13% in 2002

Challenges: • Price is too high• Installation is too complicated

– Truck rolls – Half day appointments– Software installation

• Call centers• Limited reach / availability• Often faster isn’t enough of a value proposition

– Must offer bundled multi-service applications

Q2 2002 Residential Broadband penetration according to The McKinsey Quarterly, 2003 Number 2, “Making Sense of Broadband”

Why isn’t the US attaining penetration levels similar to Why isn’t the US attaining penetration levels similar to the 54% residential penetration found in South Korea?the 54% residential penetration found in South Korea?

PROPRIETARY AND CONFIDENTIAL

The SOMA Solution

Goal Parameters Capabilities Technology SOMA Solution

Low capital costs

• Low entry costs ($/home)• Scale: pay as you grow ($/sub)

Large cell radius

Flexible capacity additions

Licensed spectrum for maximum tx power

Good receiver sensitivity

SOMA™ macro base station

and

SOMAport™ subscriber terminal

LargeRadius

PCS (1.9 GHz)

WCS (2.3 GHz)

MMDS (2.5 GHz)

3.5 GHz

PROPRIETARY AND CONFIDENTIAL

The SOMA Solution

Goal Parameters Capabilities Technology SOMA Solution

Low capital costs

•Low entry costs ($/home)• Scale: pay as you grow ($/sub)

Large cell radius

Flexible capacity additions

Licensed spectrum for maximum tx power

Good receiver sensitivity

SOMA™ macro base station

and

SOMAport™ subscriber terminal

Low operational cost

Low cost installation

Minimal customer support

Self-service install

Self-service activation

Non-line-of-sight

Intelligent subscriber terminal

SOMAport subscriber terminal

PROPRIETARY AND CONFIDENTIAL

The SOMA Solution

Goal Parameters Capabilities Technology SOMA Solution

Low capital costs

•Low entry costs ($/home)• Scale: pay as you grow ($/sub)

Large cell radius

Flexible capacity additions

Licensed spectrum for maximum tx power

Good receiver sensitivity

SOMA™ macro base station

and

SOMAport™ subscriber terminal

Low operational cost

Low cost installation

Minimal customer support

Self-service install

Self-service activation

Non-line-of-sight

Intelligent subscriber terminal

SOMAport subscriber terminal

High revenue opportunity

Bundled Services

Landline quality voice

High megabit data

Applications

Landline quality voice

High megabit data

Applications

SOMA SoftAir™ platform

PROPRIETARY AND CONFIDENTIAL

The SOMA Solution

Goal Parameters Capabilities Technology SOMA Solution

Low capital costs

•Low entry costs ($/home)• Scale: pay as you grow ($/sub)

Large cell radius

Flexible capacity additions

Licensed spectrum for maximum tx power

Good receiver sensitivity

SOMA™ macro base station

and

SOMAport™ subscriber terminal

Low operational cost

Low cost installation

Minimal customer support

Self-service install

Self-service activation

Non-line-of-sight

Intelligent subscriber terminal

SOMAport subscriber terminal

High revenue opportunity

Bundled Services

Landline quality voice

High megabit data

Applications

Landline quality voice

High megabit data

Applications

SOMA SoftAir™ platform

Low RiskProven technology

Scalability and reliability

W-CDMASOMA SoftAir™ platform

PROPRIETARY AND CONFIDENTIAL

The SOMA Solution

• Best business case– Least cost solution

• least cost of coverage

• least cost of capital per subscriber

• least operational cost

– Highest revenue opportunities– Least technology and business risk

• Built on best wireless/software technology– Highest path loss for maximum cell size and least cost of coverage– Industry-leading radio capacity for maximum Bps/Hz– Industry’s only “Smart Pipe” system

• maximum subs/Hz yielding maximum profit/Hz

• enhanced services revenue