MANAGEMENT’S DISCUSSION AND ANALYSIS ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT Additions to property, plant and equipment include costs associated with acquiring and placing property, plant and equipment into service. The telecommunications business requires extensive and continual investments, including investment in new technologies and expansion of geographical reach and capacity capital. Management focuses on the planning, funding and management of additions to property, plant and equipment, because they are significant, and have a material impact on our cash flow. Wireless additions were 23 % lower this year compared to last year because we invested significantly less in HSPA capacity and spent less on deployment of our LTE network, offset by higher investments to improve the quality and coverage of the wireless network. Our LTE network reached approximately 73 % of Canada’s population as at December 31, 2013. Additions to property, plant and equipment before related changes to non-cash working capital represent capital assets that we actually took title to and were ready for use in the period. We believe that this measure best reflects our cost of property, plant and equipment in a given period, and is a simpler measure for comparing between periods. Cable additions were higher this year compared to last year because of the timing of initiatives related to service enhancements, reflecting increasing our investment in improving our video and Internet platforms and in customer premise equipment related to the rollout of NextBox 2.0 and NextBox 3.0 digital set-top boxes and continuation of the ongoing analog to digital subscriber migration. Migrating subscribers from analog to digital will continue to strengthen the customer experience and is allowing us to reclaim significant amounts of network capacity and reduce network operating and maintenance costs. This effort requires additional spending because it involves fitting analog homes with digital converters and removing existing analog filtering equipment from the network. Business Solutions additions were higher this year compared to last year because we spent more on expanding customer specific networks, and because of capital investments made by Blackiron Data and Pivot Data Centres which we acquired this year. Media additions increased this year compared to last year because of higher expenditures on digital and broadcast facilities. MEDIA BUSINESS SOLUTIONS CABLE WIRELESS Year ended December 31 (In millions of dollars, except percentages) 2013 2012 % Chg Additions to property, plant and equipment Wireless $ 865 $ 1,123 (23) Cable 1,105 832 33 Business Solutions 107 61 75 Media 79 55 44 Corporate 84 71 18 Total additions to property, plant and equipment $ 2,240 $ 2,142 5 Capital intensity 1 17.6 % 17.2 % 0.4 pts 1 Capital intensity is a key performance indicator. See “Key Performance Indicators”. (%) 20 1 3 ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT $2.2 BILLION C ABLE 49% WIRELESS 39% MEDIA 4% C ORPORATE 3% BUSINESS SOLUTIONS 5% 50 ROGERS COMMUNICATIONS INC. 2013 ANNUAL REPORT