Looking forward: Challenges to answer, opportunites to seize

The telecommunications regulatory environment underwent tremendous change and investor scrutiny during 2006. The federal government's telecom policy review, local forbearance decision and deregulatory directive to the CRTC, plus upcoming wireless number portability, are positive steps toward giving consumers more choice and ability to determine competitive outcomes. At the same time, TELUS stands to benefit from deregulation by gaining more competitive freedom in 2007.

Our strong performance in 2006 provides a solid foundation for continued success. Even so, we recognize there are challenges and opportunities to be addressed each year. Accordingly, we identify key corporate priorities that support our national growth strategy. For a report against our 2006 priorities, please see pages 20 and 21 of the Management's discussion and analysis in the TELUS 2006 annual report - financial review. TELUS' 2007 corporate priorities are as follows:

• Combining our suite of data applications with deregulated heritage services
• Attaining best-in-class customer loyalty and growth through unparalleled customer experiences
• Achieving customer addition targets by expanding our distribution channels and addressing key market segments with new service offerings

• Progressing further in key industry verticals with specific applications that provide non-price-based differentiation
• Leveraging wireless number portability to expand our business market share in Central Canada
• Focusing on small business customer loyalty and growth with innovative solutions

• Growing in domestic and international markets through recognition that TELUS is Canada's IP leader
• Achieving excellence in customer service to support local forbearance in key incumbent markets
• Expanding our markets, channels and products by focusing on strategic relationships with our partners

• Implementing technology roadmaps for Future Friendly Home and wireless service offerings that simplify our product portfolio and improve service development and execution
• Rolling out consolidated customer care systems to replace multiple legacy systems in Alberta and B.C.
• Accelerating customer service delivery dates

• Growing our business ownership culture with a team philosophy of "our business, our customers, our team, my responsibility" thereby attracting, developing and retaining great talent
• Leading the way in corporate social responsibility as we strive to be Canada's premier corporate citizen.