COMPLETE SUPPORT AND ADVICE FOR THE DEVELOPMENT OF RADIO BROADCASTING

PROPOSAL OF ASSISTANCE

Introduction

After the passing of Real Decreto 964/2006, 1 September, approving the National Technical Plan for Radio Broadcasting in frequency modulation, the autonomous regions are in the process of granting commercial FM radio broadcasting licences. The Generalitat Valenciana plans to make an invitation to tender imminently in the next week.

DIEZ & ROMEO has wide experience in radio broadcasting which has given it a leading position in Spain and, thanks to this, it has won for its clients more than 125 DTT licences and 35 radio licences of the 6 projects carried out in the Balearic Islands (the only region which has issued the new FM radio licences).

DIEZ & ROMEO offers its general knowledge of the radio market with which to advise its clients and provide support in the drawing up of all bids it is decided to present, and, after having obtained the corresponding licence, DIEZ & ROMEO will offer full management services for the start up of the new licensed operator.

INDEX

1.- The Diez & Romeo Group

2.- The Microspecialization

3.- Our Successes

4.- Our Advice and Assistance

5.- Differential Advantages of D & R

THE DIEZ & ROMEO GROUP

1. THE DIEZ & ROMEO GROUP

THE DIEZ & ROMEO GROUP STRUCTURE

DIEZ & ROMEO possesses an extensive and confirmed experience in the area of Telecommunications and Media Law, from where it has contributed to a new approach for the audio-visual market , based on differential values, business innovation and freedom of enterprise. Especially to radio stations and television..

D & R Audiovisuais is a subsidiary that operates entirely in the media Galician sector, giving legal and technical advice to producers and operators of radio stations and local televisions.

D & R Desarrollos Tecnológicos, is a company of Engineering telecommunication, which offers to his clients a wide range of services related to the telecommunications, the computer science, the electronics and the contents multimedia.

Member of:International Bar Association

THE DIEZ & ROMEO GROUP SUPPORT

Member of: Unión de abogados Europeos

Our association with IBA and UAE: we have the support of the best professionals worldwide

Offices in en Madrid, Santiago de Compostela. Collaborations with internacional firms

Unattainable results for others firms More than 75 licenses of de Radio stations and DTT in 4 years70,2% Ratio of success

2. THE MICROSPECIALIZATION

THE MICROSPECIALIZATION

THE MICROSPECIALIZATION VERTICAL ADVISE

MICROSPECIALIZATION Important assets that our clients value with satisfaction .

• Quality • Experience • Peak Performance• Successes

MORE THAN 15 % OF SUCCESS THAT OUR COMPETITORS

He avoids the frustration that a not

microspecializing professional transmits

3. OUR SUCCESSES

OUR SUCCESSES

OUR SUCCESSES Licenses obtained of Radio & DTT in Spain RATIO 83,3%

Ratio 83,3%

0

1

2

3

4

5

6

7

Request Obtained

RequestObtained

More than 150 RADIO and DTT LICENCES obtained since 2005

OUR ADVICE AND ASSISTANCE

4. OUR ADVICE AND ASSISTANCE

Introduction

Strategy

Challenges Forward

History

1

The client will have support and advice in all and each one of the phases of the licensing process, from completion of the administrative and commercial documentation, drawing up of bids, follow-up on the procedure, up to the obtaining of the licence. Prior to everything else ,steps will taken to adapt the bidder to the regulations and analyse possible objectives for gaining a licence.In addition to this, in those areas in which the client wins a licence, Díez & Romeo will provide full management services for the start up of the FM radio broadcasting project.

GR

ANTI

NG

OF

LIC

ENC

ES

Scope of the assistancePhases of the proposal

Strategic analysis

Phase 1

Complete drawing up of radio broadcasting

project

Phase II

Support in the preparation of administrative and

commercial documentation

Phase III

Support in the formatting of the

documentation to be presented by the

client to the regional government

PHASE I: Strategic analysis(I)PHASE I: Strategic analysis(I)

• Identification of client’s priority frequencies (analysis of market, competitors, public, etc.)

• In priority tendering procedures, laying down of a strategy for providing elements of value to the regional government and identification of requirements for administrative, technical and economic information to be provided by bidders.

• Identification of client’s priority frequencies (analysis of market, competitors, public, etc.)

• In priority tendering procedures, laying down of a strategy for providing elements of value to the regional government and identification of requirements for administrative, technical and economic information to be provided by bidders.

Meetings

INFORMATION REQUIREMENTS BIDDER INFORMATION NECESSARY FOR PREPARING THE OFFER

Bidder information

ACTIVITIES

Strategic Analysis

Phase I

Audience firm (1) Aerials plan

(1) Multiplex management

(4) Assistant

(1)

Assistant (1)

Marketing Dept (1)

Technical team (19)

Production Dept (1)

Programming (3) Continuity

and traffic (7)

Manager (1)

General channel City TV

Assistant (1)

Co-ordinator (1)

Vida theme channel

Assistant (1)

Co-ordinator (1)

Parc theme channel

Assistant (1)

Co-ordinatoror (1)

Black theme channel

EDC Digital Broadcasting for Catalonia

PHASE II: Strategic analysis (II)PHASE II: Strategic analysis (II)

14A.T. Kearney 35/ .... /TZ

E3G will need approximately XX full time equivalent employees to ensure CP4: manage corporate customers

Sales management

CP4 Manage corporate customers Tasks

Channel management– Definitions of strategy and operations and standards– Planning and controlling of targets and budget – Resource allocation

Sales support

Customer acquisition & management

Capacity

Customer acquisition and management– acquisition and management

Sales support – Back office support (mailing, contact support) – Corporate customer Hotline (VIP only)– Contract, master data administration – Providing information – Sales reporting, customer satisfaction surveys

Total

Application support– Development of technological concepts for new products– Internal application support

Organizational sizing

CLIENT’S STRATEGY AND OBJECTIVES

AUDIOVISUAL PROJECT

14A.T. Kearney 35/ .... /TZ

E3G will need approximately XX full time equivalent employees to ensure CP4: manage corporate customers

Sales management

CP4 M an age corporate cus tomers Tasks

Channel management– D efinitions of strategy and operations a nd standards– Planning and controllin g of targets and bu dget – Resource allocation

Sales support

Customer acquisitio n & management

Capacity

Customer acquis ition and management– acquisition and mana gement

Sales support – Back o ffice support (mailing, contact support) – Corporate customer Ho tline (VIP only)– Contract, master d ata administration – Providing informatio n – Sales rep orting, customer satisfaction surveys

Total

Application support– D evelop ment of techno logical concepts for new products– Internal app licatio n support

Organizational sizing

VALENCIA RADIO MARKET

14A.T. Kearney 35/ .... /TZ

E3G will need approximately XX full time equivalent employees to ensure CP4: manage corporate customers

Sales management

CP4 M anage corporate customers Tasks

Channel management– Definitions of strategy and operations and standards– Planning and controlling of targets and budget – Resource allocation

Sales support

Customer acquisition & management

Capacity

Customer acquisition and management– acquisition and management

Sales support – Back office support (mailing, contact support) – Corporate customer Hotline (VIP only)– Contract, master data administration – Providing information – Sales reporting, customer satisfaction surveys

Total

Application support– Development of technological concepts for new products– Internal application support

Organizational sizing

GOVERNMENT STRATEGY AND OBJECTIVES

BUSINESS OBJECTIVES

COMMERCIAL STRATEGY

CURRNT MARKET

COMPETITORS

STRENGTHEN THE AUDIOVISUAL

INDUSTRY

PLURALITY

REGULATE

Analysis

Types of programming

Network technical viability Customer Service strategy

Economic and financial viability

Stress on local characteristics

STRATEGIC FOCUS FOR THE PREPARATION OF

OFFERS

OBJECTIVE:MAXIMUM POINTS FOR THE OFFER

PHASE II: Support in the drawing up PHASE II: Support in the drawing up of radio broadcasting projects (I)of radio broadcasting projects (I)

• Preparation of the technical, economic and programming offer:

Technical proposal. Economic proposal: Description of the bidder,

business plan and commercial strategy Programming proposal: Grid, organisation, content

production.

• Preparation of the technical, economic and programming offer:

Technical proposal. Economic proposal: Description of the bidder,

business plan and commercial strategy Programming proposal: Grid, organisation, content

production.

ACTIVITIES

Complete drawing up of the radio broadcasting project

Phase II

TECHNICAL PROPOSAL

PHASE YEAR Nº OF NEW CENTRES

INHABITANTS COVERED

COVERAGE PERCENTAGE

1 0 0 0% 1ST PHASE 2 1 4.106.289 66.81%

2nd PHASE 3 3 5.252.692 85,47% 4 0 5.252.692 85,47% 3rd PHASE 5 34 6.004.116 97.69% 6 0 6.004.116 97.69% 7 33 6.070.984 98.78% 4th PHASE 8 0 6.070.984 98.78%

Illustra

tive

IlustrativeIllu

strativ

e

Complete drawing up of the radio broadcasting

project

Phase II

ECONOMIC PROPOSAL

0%

20%

40%

60%

80%

100%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Penetración TV Analógica Penetración TDT

Audience firm (1)

Aerials plan (1)

Multiplex management (4)

Assistant (1)

Assistant (1)

Marketing Dept (1)

Technical team (19)

Production Dept (1)

Programming (3)

Continuity and traffic (7)

Manager (1)

General channel City tv

Assistant (1)

Co-ordinator (1)

Vida theme channel

Assistant (1)

Co-ordinator (1)

Parc theme channel

Assistant (1)

Co-ordinator (1)

Black theme channel

EDC Digital Broadcasting for Catalonia

PHASE II: Support in the drawing PHASE II: Support in the drawing up of radio broadcasting projects (II)up of radio broadcasting projects (II)

494.949

108.658

168.307

202.601

157.020

293.046

202.482

245.033

157.629 160.322

0

100.000

200.000

300.000

400.000

500.000

600.000

Año 1 Año 2 Año 3 Año 4 Año 5 Año 6 Año 7 Año 8 Año 9 Año 10

Investment Significant costs

Cash flow

-500.000

0

500.000

1.000.000

1.500.000

2.000.000

2.500.000

3.000.000

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10

Economic cash flow BAIT

Illustrative

Illustra

tive

Illustra

tive

Complete drawing up of the radio broadcasting

project

Phase II

PROGRAMS PROPOSAL

PHASE II: Support in the drawing up of radio PHASE II: Support in the drawing up of radio broadcasting projects (III)broadcasting projects (III)

Illustra

tive

Support in the preparation of administrative and commercial

documentation

Phase III

PHASE III: Support in the preparation of administrative PHASE III: Support in the preparation of administrative and commercial documentationand commercial documentation

ACTIVITIES

iLLUSTRATIVE

• Support in deciding on administrative documentation to be included

• Inclusion in the offer of the documentation provided by the client

• Possible collateral security in addition to the final collateral contained in the bid specifications

• Formatting and presentation of the offer to the regional government

• Support in deciding on administrative documentation to be included

• Inclusion in the offer of the documentation provided by the client

• Possible collateral security in addition to the final collateral contained in the bid specifications

• Formatting and presentation of the offer to the regional government

DIFFERENTIAL ADVANTAGES

5. DIFFERENTIAL ADVANTAGES OF D & R

Content of FM radio projects

Broadcasting networkBF equipment

HW and SW receiver equipmentInformation systems

TECHNICAL CONTEXT

Demographic analysisCultural analysis

Supply estimate analysisDemand estimate analysis

SOCIOLOGICAL CONTEXT

European Community lawNational lawRegional law

Local regulations

LEGAL CONTEXT

InvestmentsOperating costs

RevenueFinancing

ECONOMIC CONTEXT

DIFFERENTIAL ADVANTAGES Preparation of radio projectsPreparation of radio projects

DIEZ & ROMEO was created in 1995 with independent capital. Its founder members and professionals have wide tried and tested experience in the area of telecommunications and information technology (IT), which provide the focus and differential values necessary in the market.

Profile of the professionals

Díez & Romeo is made up of more than 60 highly qualified professionals with wide and tried and tested knowledge both of the telecommunications and IT sectors and of their operators, services, technology platforms, applications and businesses.

Díez & Romeo carries out an active, constant and effective selection and management of human resources which is reflected in a high degree of loyalty of its consultants.

LEGAL ADVISERS15%

TELECOMUNICATIONS ENGINEERS

20%

LAWYERS / MBA55%

ECONOMISTS / MBA10%Value chain of the telecom sector.

Diez & Romeo forms part of the value chain of the telecommunications market, advising all of its operators on the adoption and adaptation of technology platforms and telecommunications services to their businesses.

Regulators

Madrid

Santiago de Compostela

Service providers, telecom operators

and service integrators

Infrastructure suppliers

Fina

l C

usto

mer

s

Content and application suppliers

DIFFERENTIAL ADVANTAGES Profile of the firmProfile of the firm

www.diezromeo.com

““Maintaining good communications”

Maintaining good communications”

““Engineering victories

Engineering victories”

General Pardiñas, 15 1º28001 Madrid

info@diezromeo.comTel.: 91 7992924Fax: 91 7992925