Entel Chile

Entel Chile14th Annual Latin American CEO Conference, January 2010Hosted by SantanderInformation available atwww.entel.cl0

Table of contentsIndustry Size and Competitive EnvironmentCompany OverviewBusiness SegmentsFinancial Overview1

Company Overview3

Entel is the largest telecommunication company in ChileEntel Overview Leading competitive position in main markets inwhich participates. Provides wide range of integrated telecomservices. Quality and reliable service. Innovative, reliable and customer oriented. Leader telecom brand name.2008 Revenues by Business LineLong distance4%Local telephony4%Datacomm services(includes IT)9%Services to otherTelecom companies4% International subs2%Call Center1%Entel’s Market Share (September 2009)39%32% - 38%40%Mobile services76%Mobile DLD - ILD DataServicesTotal Revenue 2008 = US$1,939 MM (*)Source: Entel* Residential Segment(*): CHGAAP Constant CHP as of December 2008divided by $550,36.4

Entel is the top brand in the Chilean telecom industryOverall Image Survey Chilean Telecom Sector (October 2009)Entel Telefónica CTC Telmex/Chilesat Telefónica del Sur VTR Movistar Smartcom PCS Claro5052393932332828252624252220 2019191614141178 87 7 7 78455653 34 64 3 3 4220 0 0 0 0 040383935323132 323030282627252424232324212020192018191815141110899 97 767 7 7878 897 7745563 3454 4545412223 30 0 0 0 0 0 0 01BestproductsCustomerServicesmoreconfiabilityLeaderMarketBest Prices Coverage, Brand indexIt has signaleverywhereBetterservicequalityMostAdvanceTechBest cellphonecompanyBestinternetsupplierBest carrierFavoriteBrandWould yourecomendBest future MostInnovativeCompanySource: “Kronos Chile October 2009”5

Entel’s services are supported by its top quality network…Mobile Network(60 Mhz in Band 1900 Mhz)Domestic Fiber Optic NetworkDigital Microwave Network1 BSCIQUIQUE1 BSCANTOF.1 BSCCOPIAPO1 BSCSERENA1 BSCQUILLOTA2 BSCVALP.11 BSCSTGO.1 BSCSAN ANTO.2 BSCRANCAGUA1 BSC CURICO1 BSC TALCA2 BSC CONC.1 BSC CHILLAN1 BSC TEMUCO1 BSC VALDIVIA2 BSC P. MONTT1 BSC COYHAIQUE1 MSC-SANTOF.1 MSCLA SERENA1 MSC-S; 1 MSCVALP.2 MSC; 1GMSCSTGO.4 MSC-SSTGO.1 MSC; 1MSC-SRANC.1 MSC;1 MSC-SCONC.1 MSCTEMUCO.1 MSC-SP. MONTTCONC.IQUIQUEANTOFAGASTALA SERENAVALPARAISOSANTIAGORANCAGUACONCEPCIONTEMUCOPUERTOMONTT1 BSC P. AREN.1 MSC; 1 MSC-S PUNTA ARENASP. AREN.1 MGW IQUIQUE1 MGW IQUIQUE1 RNC IQUIQUE1 MGW ANTOF.1 RNC ANTOF.1 MGW COPIAPÓ1 MGW1 MGW LA SERENA1 RNC LA SERENA1 MGW VALPO1 MGW QUILLOTA1 MGW 1 MGW VALP.2 RNC VALP.6 MGW STGO5 RNC STGO1 MGWSAN ANTONIO1 MGW RANCAG.1 RNC RANCAG.1 MGW CURICO1 MGW TALCA1 MGW CONCEP.1 RNC 1 RNCCONCEP.1 MGW CHILLAN1 RNC CHILLÁN1 MGW TEMUCO1 RNC TEMUCO1 MGW P. MONTT1 RNC P. MONTT1 MGW VALDIVIA1 MGW COYAIQUE1 MGW P. ARENAS1 RNC P. ARENASPanamericanCableAricaIquiqueAntofagastaLa SerenaValparaísoConcepciónValdiviaFO Cableto PeruChillánFO Cableto BoliviaCopiapoFO Cable toArgentinaand AtlanticoceanLos AndesFO Cable toSantiago B.Aires andP.Arenas (Chile)ARICAR/EIQUIQUEANTOFAGASTALA CRUZR/ER/EEL VIENTOCOPIAPOR/ELA SERENAVALPARAISOEL ROBLER/ESANTIAGOR/ETALCAR/ECHILLANCONCEPCIONTEMUCOR/EVALDIVIAPUERTO MONTTCASTROR/ER/EPTO. AYSENR/ER/ECOYHAIQUECapacity2 X 140 MBPS4 X 140 MBPS3 X 140 MBPS3 X 140 MBPS4 X 140 MBPS2 X 140 MBPS3 X 140 MBPS2 X 140 MBPS3 X155MBPS3 X STM-1 MBPS3 X STM-1 MBPSBTS( 3.117 )BSC( 32 )MSC( 9 )MSC-S(10)MGW(23 )MSC : Mobile Switching CenterMSC-S : Mobile Switching Server CenterBTS : Base Transceiver StationsBSC : Base Station ControllerMGW : Media GatewayRNC(16 )RNC: Radio Network ControllerPSTN: Public Switch Telephony NetworkPSTNPuerto MonttFO Puerto MonttdestinoCoyhaiqueFO: Pta Arenas- Argentina-StgoPTA. ARENAS6

...including Local Telephony & Fixed Wireless NetworksLocal Telephony Network (NGN-IP)Fixed Wireless Coverage (WiMax)ARICAIQUIQUEANTOFAGASTACOPIAPOLA SERENACOQUIMBOQUILLOTAVALPARAISOCHILLANTALCAHUANOCONCEPCIÓNTEMUCOVALDIVIAOSORNOPUERTO MONTTSAN ANTONIOSANTIAGORANCAGUASAN FERNANDOCURICOTALCALINARESLOS ÁNGELESCOIHAIQUEVALLENAROVALLESAN FELIPELOS ANDESCALAMAAricaIquiqueAntofagastaCopiapóLa SerenaCoquimboViña del MarValparaísoSanta CruzCuricóConcepciónTalcahuanoLlanquihueCastroChuquicamata (SanJorge)CalamaSan PedroMichillaLincePaipotePichinchaPan de AzucarLos Andes - San Felipe - NogalesQuillotaCasablancaSantiagoRancaguaPichideguaTalcaChillánLos ÁngelesTemucoOsornoPuerto MonttPTO. NATALESPTA. ARENASNGN PresenceSwitches NGN Entel’s network provides services to the maincities of Chile (digital and NGN switches).San GregorioWiMax PresenceWiMax Presence (Cluster) Nationwide capacity for 350,000 equivalentlines. 2 national coverage licenses. 100 MHz totalspectrum frequency in 3.5 GHz band7

Entel provides transportation capacity via global consortiumsFiber Optic and SatellitesLos AngelesNueva YorkOJUS MiamiNAP MiamiPORTADORA HAITIPORTADORA CUBALANautilus Miami - NY1024 KBPS2 MBPS2x 2x STM-11x 1x STM-416xSTM-11xSTM-11 Giga EtheENTEL Bolivia(1 (1 STM-1)Panamericano, Columbus II IIUNISUR, Americas I&II, I&II, Maya MayaTx Tx EquipmentIP IP Router1x 1x STM-641x 1x STM-161x 1x STM -4 -41x 1x STM -1616x STM-1432 MB1 Giga Ethe1 Giga EthePOPSantiagoLimaRío de de Janeiro8

Moving forward in Social ResponsibilitySocial Responsibilityis an essential part ofEntel’s corporatemanagement…... Voluntarilymanifesting the abilityto listen, understandand meet theexpectations andinterests of theCompany’sstakeholders ...... In order to ensurelong termsustainability,contributing to thedevelopment andwelfare of society.Some of Entel’s socialprojects include:• Connecting Dreamsof Norte Grande•Rapa Nui Global, alocal educationmodernizationprogram•Connectivity for ruralschools in Isla Huar•Connectivity for theDiferencial Paul HarrisSchool9

Corporate structureMain Operating Companies (Year 2008)US$ 442 mmUS$ 135 mmENTEL Chile S.A. ***Long Distance / Data ServicesInternetEntel Consolidated:Total Revenues 2008: US$ 1,939 mm*Total EBITDA 2008: US$ 769 mmUS$ 1,499 mmUS$ 617 mm100%ENTEL TelefoníaPersonalMobile PCS (60 MHz)MobileUS$ 102mmUS$ 10mmmm100%ENTELPhoneLocal Telephony / WiLL100%US$ 46 mmUS$ 3 mmAmericatel PeruLD / Internet/Datacom/LocalInternational WirelineUS$ 33 mmUS$ 4 mmCall CenterChile / Peru100% 100%EntelfonicaCommercial SupportUS$ 4mmUS$ 1mmCientec **ITSupport ServicesChile Wireline*Net of inter-Company revenues.**Company acquired in December 2008 (only one month considered)***Entel Chile S.A includes other subsidiaries10Values in CHGAAP: Constant CHP as of December 2008divided by $550,36.

Entel shares are traded in the Chilean stock marketHighlightsEntel’s Ownership – Strong and experiencedListed on Santiago stock exchange.Market cap 1 : US$ 3.4 billion. Daily average trading volume 2 : US$ 4.1million.Represents 3.0% of the top 40 mosttraded stocks (IPSA Index ) 2 .Foreing Funds / DirectInvestment5,4%Pension Funds22,4%Retail17,4%Altel InvestmentsLtda.54,8%3As of December 30, 20091: Exchange rate 507.10 Ch$/1 US$.- Stock price as of January 4, 2010.2: Average from December 2007 to December 2009.3: Altel is a wholly-owned subsidiary of Almendral (Holding Company) and its main controllers are Matte, Fernandez/Hurtado, Izquierdocc and Gianoli Economic Groups.11

Business Segments12

MobileNetbooks13

Mobile industry worlwide trendsMobile industry revenue mixVOICEVAS (Without Mobile Broadband)Mobile Broadband90,0%85,0%80,0%75,0%70,0%65,0%85,9%84,1%77,1%74,3%71,1%67,7%2007 2008 2009 2010 2011 201226,0%24,0%22,0%20,0%18,0%16,0%14,0%12,0%10,0%23,7%23,0%22,1%20,9%13,5% 14,5%2007 2008 2009 2010 2011 201210,0%9,0%8,0%7,0%6,0%5,0%4,0%3,0%2,0%1,0%0,0%1,4% 2,0% 8,6%5,9%3,6%0,5%2007 2008 2009 2010 2011 2012Source: Informa Telecoms and MediaVoice business is decreasingshare over total revenues.Innovative VAS andmobile broadbandincreasing share.14

Trend of worldwide mobile broadband penetration v/sper Capita GDP ppp (2008- 2011)Mobile Penetración broadband penetration BAM (%) (%)30%25%Austria20%GermanyItaly15%Netherlands10%Poland Check Rep.5%UKSpainFrance0%10.000 15.000 20.000 25.000 30.000 35.000 40.000 45.000 50.000PIB GDP per per Cápita Capita (USD) US$Country 2008 2009 2010 2011France 2% 4% 7% 10%Poland 4% 6% 9% 11%Check Rep. 2% 5% 8% 10%Spain 4% 7% 10% 12%UK 4% 8% 12% 15%Netherlands 5% 8% 12% 15%Italy 7% 11% 14% 17%Germany 7% 11% 15% 18%Austria 12% 17% 21% 24%15Sources: Mobile Broadband trends Analysis Mason; GDP trends IMF.

Entel is a leader in the mobile industryMobile Overview60 MHz in the 1,900 MHz band with GSM technology. Upgraded to3.5G nationwide.Strong market share at 39%, growing in postpaid.95% penetration in Chile.Entel’s Mobile Subscribers*(in Thousands)4,1107835,0101.0301.49013% 4.249 2.007 5%5,6386,0011.7875,8225,8511.7076,1261.913Market growth driven by mobile broadband and innovative VAS(Internet mobile and e-mail).3.3273.9804.1484.2144.1444.2132009 affected by a 45% reduction in access charges.Strategic FocusBe the most highly regarded Chilean mobile company, with best-inclassservices and network.2005 2006 2007 2008 9M08 9M09Prepaid PostpaidCagr*Including Mobile BroadbandGrowth 08/09Market Share as of September 2009**Create value enhancing ARPU. Improve global service (customercare / satisfaction and deployment of innovative services).Expand penetration of mobile broadband services (flat rates,prepaid plans, 3.5G network expansion). Continue growing ininnovative VAS (mobile Internet and e-mail download). Keepselective migration to postpaid and reposition prepaid segmentstrategy. Expand distributions channels.Ensure best performance of the network for 2G (voice) and 3Gservices: expand capacity and coverage nationwide.Claro19%Movistar42%Nextel0%Entel PCS39%16Source: Entel** Market Share measure over active customers

Value added services and 3.5G growing at high ratesValue Added Services Revenues *(US$ Millions)CH GAAPCHGAAP: Constant CHP as of December 2008divided by $550,36.5834%801051399436%1292005 2006 2007 2008 9M08 9M09* Including Mobile Broadband (as of September 2009 208 th. customers)CagrGrowth 08/09VAS / Outgoing Revenues(%)11,6%13,0%15,4%18,5%7,7%9,7%1998 to 20032004 2005 2006 2007 2008 9M 2009SMSGPRSXAT (SMS)WAPSMS PremiumMMSEDGEEDGE NationwideVideo StreamingPTTBlackberry3.5 G in Santiagoand V region3.5 G coveragenationwide17

Profitable client baseMobile Revenues (US$mm) Mobile EBITDA and EBITDA Margin (US$mm, %)CH GAAP14%CH GAAP16%IFRS1.0011.2041.376 1.499 1.015 1.001521-5%584 617 432 410-1%IFRS39439%43% 42% 41%43% 41%2005 2006 2007 2008 9M08 9M092005 2006 2007 2008 9M08 9M09Blended ARPU 1 (US$)MOU 2 (Minutes/month)CH GAAPIFRS-1% 8%-6%10%19,919,619,819,418,217,1166 163176126 1281442005 2006 2007 2008 9M08 9M091 Average Revenue per User.2Minutes of UsageCagrGrowth 08/092005 2006 2007 2008 9M08 9M09CHGAAP: Constant CHP as of December 2008divided by $550,36.18

Mobile Access Charges Setting for 2009 - 2013140Access Charge Average price Ch$/min105112,447063,6760,5257,543562,0959,0202008 2009 2010 2011 2012 2013Previous Decree New DecreeTariff decree process for Mobile access charges effective late January 2009 resulted in a decrease of 45% inaverage (to 63,67 Ch$/min – 0,12 US$/min).Growth in the postpaid base and reduction in handsets subsidies have mitigated the impacts of the accesscharge reduction.19

The wireline business - Chile20

Chile wireline offers integrated solutions focused on theenterprise segmentRevenue distribution per segment – Year 2008Corporate and SME * Residential * Services to Other TelecomCompanies *Local Telephony30%Long Distance andvalue addedservices12%Internet9%Internet11%Local Telephony6%Traffic Business31%IT Services17%Data services32%Long Distance andvalue addedservices83%Network Rentals69%US$ 273 million US$ 53 million US$ 175 millionCHGAAP: Constant CHP as of December 2008divided by $550,36.* Includes intercompany Revenues21

Corporate and SME segments: leading position, expanding intoIT servicesOverviewLeading position and expertise, leveraging Entel’sextensive network (40% market share in traditional dataservices). Growing participation in IT.Market trends: integrated offerings including IT/telco;convergence of fixed and mobile; bundle solutions overIP networks (NGN – MPLS).Lines in Service Enterprise Market (Local Telephony)90,428%127,728,2172,459,863,463,368,790,4 99,5 112,6 127,4 125,4 136,12005 2006 2007 2008 9M08 9M09Local Telephony Lines190,8NGN Lines188,78%204,8CagrGrowth 08/09Corporate Strategic Focus Be the best and largest provider of integrated telecomservices (data, local telephony and networkadministration). Consolidate competitive position in the target IT market(including Cientec consolidation), aligned withinternational quality standards. Provide innovative solutions based on the convergence offixed-mobile services and growth in next generationtechnology demand.SME Strategic FocusIncrease market share.Expand low cost NGN-IP bundling solutions. Develop acompetitive access network (copper pair, WiMax).Lead in innovative services: IT offer and convergenceto fixed - mobile solutions.Network providers Data Centers SW ProvidersProfessional ConsultancyAccess andTransportationNetwork OperationDatacenterinfrastructureDatacenterManagementApplication Supportand OperationManagement andMaintenance ofApplicationProcess and SystemIntegrationsBusiness PlansHigh Focus Medium Focus Low Focus22

Services to other telecom companies: Optimization ofnetwork usageOverview Leading provider of network infrastructure tothe operators.Revenues 2008TrafficBusinessTotal revenues of US$ 175 million in 2008. Service provided to Entel PCS represents morethan 50% of Network Rentals.US$ 55mmUS$ 120mm Traffic desk manages high volumes related toWholesale, Incoming Traffic and Value Added.NetworkRentalsNote: Includes intercompany RevenuesStrategic Focus Provide quality service of rental network capacity to related companies and other operators. Leverage current network capacity. Traffic routing optimization to assure low tariffs for LD traffic. Focus on low risk profilecustomers.23CHGAAP: Constant CHP as of December 2008divided by $550,36.

Structural changes are showing results in Chile wireline(US$ millions)CH GAAP2%IFRS17514010570350136144124 1271309833%27% 26% 27%29% 29%2005 2006 2007 2008 9M08 9M0933%50%45%40%35%30%25%20%EBITDAEBITDA MarginAfter deep structural changes, EBITDA is growing again. This reflects the strategy of developingbusiness through integrated solutions including voice, data and IT services focused on the enterprisesegment.CagrGrowth 08/0924CHGAAP: Constant CHP as of December 2008divided by $550,36.

Americatel Peru25

Americatel PeruOverview Relevant presence in LD service through itsdial around 1977 code andpresubscribed/contract plans. Increasing presence in Datacom and localtelephony services for business clients in Lima. Growing in NGN-IP services over WiMax focusedon the enterprise segment, synergizing withthe Chilean experience.Strategic Focus Change in revenue mix, increasing servicesover its own access network in Lima (WiMax,copper).Revenues (US$ millions)CH GAAP4%35 343740IFRS-2%30 292005 2006 2007 2008 9M08 9M09CagrGrowth 08/09Revenue Mix 2005 – 2008: Changing to services provided over own access networkData, LocalTelephony &NGN14%Wholesale36%LD50%Data, LocalTelephony & NGN31%LD44%Wholesale25%2005 200826

Financial Overview27

Strong profitabilityConsolidated Figures (US$ MM )RevenuesCH GAAP5%*1.939IFRS1.7861.7211.6643%1.3031.338EBITDA and EBITDA MarginCH GAAP12%769718663554IFRS1%534 542CagrGrowth 08/0933% 39% 40% 40% 41% 40%2005 2006 2007 2008 9M08 9M09* Excluding the impact of int. subs. sold in 2006, Cagr is 10%5,822 3392005 2006 2007 2008 9M08 9M09Operating IncomeCH GAAP12%Net IncomeCH GAAP22%IFRS281358382394IFRS-8%267246154213259 279-4%193 1862005 2006 2007 2008 9M08 9M09 2005 2006 2007 2008 9M08 9M0928CHGAAP: Constant CHP as of December 2008divided by $550,36.

CAPEX plan driven by the mobile expansionCAPEX Strategy Focused on keeping technological / qualityedge in the Mobile, managing growth andproviding broadband solutions. Investments in mature services at minimumlevels. 82% of CAPEX focused on Mobile. Bulk of investment is driven by demand.Other Mobile55%2008 CAPEX BreakdownMobile Handsets27%Data + Internet +Local Telephony+ NGN14%NetworkInfraestructure2%Int. Subs.1%LD + Others1%Historical CAPEX * - Excluding postpaid handsets(US$ in Millions)Total = US$ 491 millionCAPEX / Revenues3601499%23213%27615%19%2005 2006 2007 2008*Average Exchange rate of each year.29

Cash Flow in line with mobile expansionCash Flow *(US$ Millions)CH GAAP1%269283 285 274IFRS-15%2031722005 2006 2007 2008 9M08 9M09* Cash Flow is defined as: EBITDA - Capex - Net financial expensesCagrGrowth 08/0930CHGAAP: Constant CHP as of December 2008divided by $550,36.

Liquidity and debt ratios reflects the company’s healthyfinancial position…CH GAAPIFRS2005 2006 2007 2008 9M08 9M09Current Ratio 1,84 1,42 1,44 1,40 1,39 1,19EBITDA/Financial expenses 11,68 11,59 18,51 29,22 26,41 34,99Total Borrowed Funds/EBITDA 1,70 1,43 0,99 1,01 0,96 1,02Total liabilities /(Equity+ Minority interest) 1,28 1,25 0,94 1,00 1,01 1,00Net financial debt (US$ Million) 840 642 584 606 618 685Net financial Expenses (US$ Million) 40 37 31 21 16 14• Fully hedged to F/X exposure.• 44% of debt is at fixed rate.• Moody’s rating: Baa1, S&P rating: BBB+ (both with stable outlooks)• Dividend policy: Up to 80% of Net Income.31CHGAAP: Constant CHP as of December 2008divided by $550,36.

… with a comfortable debt payment scheduleMaturities(US$ Millions)2032042042424102009 2010 2011 2012 2013 2014 2015…onwardsBank Leasing Comercial PaperTotal gross debt = US$ 669 million as of September, 2009.32

End of Presentation33