Buongiorno Spa Interim Report as of March 31, 2009

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4. Directors’ Report on Operations Buongiorno's Business Model and Target Market (VAS) Over the last decade, the global VAS market (value-added services for mobile and fixedline telephone users), has seen an expansion in both consumer demand and the range of services offered by providers. In 2008, its value was estimated at between Euro 22 billion and Euro 24 billion (vs. Euro 20 billion in 2007). Analysts and researchers predict that the market will continue to grow in coming years (until 2012), though at a slower pace than in the past, that growth will be unevenly distributed geographically and that it will slow gradually in the long term. Various factors lead to an inconsistent growth pattern of the evolutionary and transformation phases of technology markets, however, none of these seem to threaten the position of a pure player like Buongiorno. In a highly fragmented competitive scenario characterized by a large number of relatively small local players (sales under Euro 20 million), Buongiorno holds a dominant position in terms of revenues in three countries and is among the leading players in five other key countries. Despite the evident web-mobile convergence, the market of pure Mobile VAS players remains relatively protected, in part due to the business model used by web players to approach the market, which is based on advertising revenues and not on direct customer billing. Similarly, mobile phone manufacturers developing VAS products will do so with "closed offers" for their customers, thus having a limited impact, while large telephone operators (telcos or carriers) continue to consider VAS a non-core activity (unlike voice and broadband access and broadband traffic) and are therefore striving, with intensifying determination across the world's most important markets, to adopt Full Portal Outsourcing business models, which represent excellent opportunities for pure Mobile VAS players. Lastly, Media Companies, which are showing increasing interest in the sector, started entering the market through commercial agreements with, or direct investments in, mobile VAS players (NewsCorp with Jamba; RCS with DADA). Turning to Marketing Services (Marketing Solutions for Businesses), the business model for which is founded on advertising revenues, analysts and researchers agree in the belief that mobile advertising (estimated to reach Euro 7-12 billion by 2011), in a global context in which there are over three billion mobile telephone users, 1.4 billion televisions and one billion personal computers, may attract an increasing share of the advertising expenditures of leading brands. The value of this market at the global level in 2008 has been estimated at between one and two billion euros and mobile advertising campaigns have become a fixture in the marketing mix of large advertising investors. For example, in 2008 P&G planned mobile advertising campaigns for over 50 of its brands. In the early months of 2009, mobile advertising continued to take on increasing importance in the marketing mix of companies. Visiongain estimates that, in Western European countries alone, the market will grow to approximately Euro 615 million by the end of 2009, thanks in part to the intense use of mobile devices with advanced capabilities (smartphones) and the offering of flat rates for mobile Internet access. Buongiorno SpA Interim Report as of March 31, 2009 8
Market Trend and Group Performance in Q1 2009 Buongiorno is an Italian independent multinational, a leader in the digital mobile entertainment market (Mobile VAS) on an international level. Buongiorno works with the major telephone and Internet service providers and media companies in 53 countries, designing and distributing a broad range of mobile digital content and interactive applications: music, games, video, wallpapers, ringtones, user-generated services, chat, TV voting, quizzes, and advertising. As of the second half of 2008, Buongiorno has started operating also in the Mobile Social Networking segment. Buongiorno is present in all the major European countries, the United States, Australia, and several countries in Central and South America, Africa and the Middle East. Through a joint-venture with Mitsui, it also operates in Russia, India, and Eastern Asia. On this market Buongiorno’s mission is to offer a digital entertainment experience to more than a billion people across the world by 2012. Buongiorno operates with two business lines: value-added services for mobile and fixedline telephone users (Consumer Services – VAS) and relationship marketing services for businesses (Marketing Services). Consumer Services VAS are sold directly under the BlinkoGold and Movilisto brands (direct or B2C business lines), or under the white label in partnership with the main telephone carriers (carrier solutions or B2O business lines) — such as the Vodafone group, Tim, Telecom Italia, Telefónica O2, Orange, SFR, O2, T-Mobile, Maroc Telecom, Cosmote, etc — and/or with media groups (interactive TV or B2B business lines), particularly Telecinco, Televisa-EsMas, TIL, Vietnamnet and Prisa Group. The following chart provides an overview of the role played by Buongiorno on the market of mobile value added services. Buongiorno SpA Interim Report as of March 31, 2009 9
Page 1 and 2: Buongiorno SpA Interim Report as of
Page 3 and 4: 1. Company Boards Board of Director
Page 5 and 6: 3. Principles Adopted for the Conso
Page 7: During the quarter ended March 31,
Page 11 and 12: peoplesound has become universal an
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Page 15 and 16: EARNINGS PER SHARE 03.31.2009 03.31
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Page 21 and 22: ANNEX A: Breakdown of Sales by Geog
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Buongiorno Spa Interim Report as of March 31, 2009

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