Lisbon, 29 & 30 October 2012

WRAP-UP AND Q&A

Zeinal Bava | Chief Executive Officer Portugal Telecom | Technology & Innovation Conference | 0

IMPORTANT NOTICE
This release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements are not statements of historical facts, and reflect goals of the company's management. The words "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "predicts, "projects" and "targets" and similar words are intended to identify these forward-looking statements, which necessarily involve known and unknown risks and uncertainties. Accordingly, the results of operations of the company to be achieved may be different from the company's current goals and the reader should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date they are made, and the company does not undertake any obligation to update them in light of new information or future developments.

Portugal Telecom | Technology & Innovation Conference | 1

NETWORKS AND INFRASTRUTURE

Key take-aways End of network and infrastructure investment cycle to meet customer needs and monetise on data growth Build out of a fully convergent, all-IP network to provide seamless high-quality access on all platforms in a cost efficient way Best coverage, best speeds and highest reliability enabling innovative services and best customer experience across all segments
Portugal Telecom | Technology & Innovation Conference | 2

BUSINESS-TO-CONSUMER
Key take-aways Residential transformation leveraging on advanced TV services, triple-play bundles and superior customer experience with fibre Strategy focused on mobile data and tiered flat pricing plans to drive usage in personal mobile Explore convergence to grow market share leveraging on unique assets, namely customer base, brands, sales channels, targeting and execution
Portugal Telecom | Technology & Innovation Conference | 3

BUSINESS-TO-BUSINESS
Key take-aways Comprehensive B2B offering critical to address increasingly segmented and complex demands from enterprises Clear understanding of the key success factors to explore new business opportunities, namely skills, partnerships and execution Uniquely positioned to build new data revenue streams from the growth opportunities in cloud
Portugal Telecom | Technology & Innovation Conference | 4

OPERATIONS
Key take-aways IT transformation is playing a key role in improving efficiency and enabling convergence Productivity improvements with rollout of new generation networks, increased IT utilisation and field force transformation Efficiency improvements from IT, FTTH and 4G will continue to underpin cost reduction and profitability
Portugal Telecom | Technology & Innovation Conference | 5

INNOVATION
Key take-aways Structured management of capital allocation with an integrated innovation roadmap Partnerships with global innovators and with leading Portuguese companies to create an innovation ecosystem and share risks Competitive time to market with successful launches in new opportunity areas
Portugal Telecom | Technology & Innovation Conference | 6

UNIQUELY POSITIONED TO CREATE VALUE THROUGH THE NEXT CYCLE

Market share (customers) Share-of-wallet Churn OPEX CAPEX

Grow household
penetration

New B2C services

(e.g., cloud, VAS on TV, mobile data)

Fibre and tripleplay penetration

Fibre penetration Efficiency gains

driven by IT and process virtualisation

End of NGN
investment cycle

Capture
convergence crossselling opportunity

Flat rate and

smartphone penetration

Capex excluding
maintenance to be mostly demand driven

New B2B solutions

(e.g., cloud, IT outsourcing M2M and advanced solutions)

Customer
experience and retention

Improving
efficiency of touch points

Portugal Telecom | Technology & Innovation Conference | 7

Lisbon, 29 & 30 October 2012

WRAP-UP AND Q&A

Zeinal Bava | Chief Executive Officer Portugal Telecom | Technology & Innovation Conference | 8