iesy Repository GmbH - Irish Stock Exchange

iesy’s Basic Cable Subscription Fees
The basis for the subscription fees for iesy’s basic cable television services is its standard rate card. The rate card was
originally established by DTAG and is based on network element costing. There are several anomalies within this rate card
structure and other legacy arrangements which iesy has sought, over the past several years, to correct. See “Operating and
Financial Review and Prospects of iesy—Factors Affecting Our Results of Operations—Basic cable television sales.” The
following table shows iesy’s standard rate card for its basic cable offering, which is based upon the number of dwelling units
connected to each connection point from Level 3 to Level 4 networks:
Subscriber category
156
Standard rate (monthly
subscription rate in €,
excluding VAT) (1)
Flat rate (monthly
subscription rate in €,
excluding VAT) (2)
Single subscriber 12.73 NA
2 and 3 dwelling units 11.46 NA
1-10 (for more than 3) dwelling units 8.74 NA
6 dwelling units 8.74 7.29
7 dwelling units 8.74 6.25
1-10 (for more than 7) dwelling units 8.74 6.12
11-20 dwelling units 7.82 5.47
21-40 dwelling units 6.19 4.33
41-100 dwelling units 4.79 3.35
101-200 dwelling units 3.23 2.26
Each additional dwelling unit 2.19 1.53
(1) The standard rate is charged for each dwelling unit per building that actually uses iesy’s services.
(2) The flat rate is lower than the standard rate, but is charged for the total number of dwelling units per building,
regardless of the number of dwelling units that actually use iesy’s services. The flat rate is available to customers who
do not wish to report subscribers on a monthly basis so that the reduced rate is applied to the maximum possible
subscribers that each customer represent.
In addition to the monthly subscription fees, subscribers generally pay an activation fee upon connecting or reconnecting
to iesy’s network. This activation fee is sometimes waived for larger multiple-dwelling unit customers. The
following table shows iesy’s standard rate card for analog cable activation fees:
Subscriber Category
Activation Fee
(in €, excluding VAT)
1-10 dwelling units 28.90
11-100 dwelling units 11.11
more than 100 dwelling units 4.44
iesy has two types of residential subscribers, those that entered into cable television contracts in 1991 or earlier, and
those that entered into such contracts after 1991. Subscribers who entered into cable television contracts in 1991 or earlier are
deemed by iesy to have subsidized a portion of the original cable television installation of the Level 4 cable network and,
therefore, receive a discount of approximately 8.2% on the monthly subscription fee, as compared to the monthly
subscription fees of subscribers who entered into their contracts after 1991. iesy expects that this discount will be eliminated
over time as these subscribers sign new contracts with iesy or receive new products, eventually leading to a single tariff
scheme for all dwelling unit subscribers. iesy may consider plans to adopt one unified tariff scheme earlier for all single
dwelling unit subscribers.
iesy’s subscribers can prepay their monthly subscription fees on an annual basis in return for a 5% discount.
Subscribers in multiple-dwelling units frequently share one bill for cable television services. In addition, certain customers
who execute specific advance frame contracts or multi-year agreements may receive additional discounts from iesy on an
individual basis in return for these contracts. Historically, iesy has also discounted its standard rate for professional Level 4
operators. See “—Subscriber segments.”
iesy’s Basic Cable Carriage Fees
In addition to subscription fees, iesy receives carriage fees from broadcasters for the delivery of television and audio
signals via its network. Private as well as public broadcasters pay carriage fees. The underlying contracts typically have one
or two year terms with automatic renewal clauses for successive one-year terms. In general, carriage fees for analog channels
are charged on a monthly basis, depending on the number of iesy’s subscribers. Carriage fees for basic cable service