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24 September 2004

Swisscom acquires strategic shareholding in the Cinetrade Group

Swisscom is in the process of acquiring 49% of the shares of CT Cinetrade AG, a move that will give it access to media know-how critical to its multimedia business. The activities of the Cinetrade Group include pay-TV (Teleclub), cinemas (KITAG) and the exploitation of rights to video or DVD film rights (PlazaVista). Over the next few years, Swisscom can further increase its stake in CT Cinetrade AG. Stephan Sager, who has been the sole owner of CT CineTrade AG up to now, will remain CEO of the Group. Authorities have yet to give their approval for the transaction. The parties concerned agreed not to disclose details of the price.

For Swisscom, the core of this strategic partnership lies in the "Triple Play": supplementing the core activities of telephony and Internet with TV over broadband Internet in the medium term. In the future, Swisscom will be able to give its customers extra added value with a total range of products and services from all three segments. The Cinetrade Group will give Swisscom access to expertise, content and distribution channels that will drive the implementation of this strategy forward.

Media content for three Group companies

Within the Swisscom Group, clear media and convergence trends can be identified in three Group companies: Swisscom Fixnet (Triple Play, including video-on-demand, television over ADSL and pay-TV), Swisscom Broadcast (expansion of its offering to cable network operators providing high-quality content) and Swisscom Mobile (video content over Vodafone live!). As a result, an integrated strategy and the expansion of the distribution channels are very important for all three Group companies. Central management of multimedia content ensures the continuation of the legacy channels and the expansion of the Cinetrade Group's multi-channel strategy with targeted positioning and management of the individual distribution channels.

Three key pillars in the film business with leading market positions

As a media enterprise, the Cinetrade Group is involved in the areas of pay-TV (Teleclub), cinema (KITAG) and the exploitation of video and DVD film rights (PlazaVista).  In 2003, the company generated CHF 90 million in revenue and had around 300 employees in Switzerland.

Teleclub AG is the leading pay-TV provider in Switzerland. At the end of 2003, the company had approximately 70,000 customers using its services by cable. Several thousand customers also receive Premiere World satellite channels, for which Teleclub has exclusive resale rights in Switzerland.

Berne, September 24, 2004