report of the management Board  
     
  taking navigation to the next level  
 
  “Independent research shows that using a PND reduces miles driven by 16% and travel time by 18%. This is good news not only for TomTom and our customers, but for the environment as well.”  
     
  BUSINESS REVIEW
We made some huge strides forward in 2007 in the execution of our strategy. In particular, the introduction of TomTom Map Share™, with the establishment and development of our historical speed-profile database, and the launch of TomTom HD Traffic™ we believe we are now taking car navigation to a new level.

PRODUCTS AND SERVICES
During the year, we introduced a full range of new models, including our first mid-range product, the TomTom ONE XL, and the world’s first embedded portable navigation solution for the automotive industry. The introduction of the new TomTom GO range, the GO 920, GO 720 and GO 520 – complete with the latest state-of-the-art technology, such as voice recognition, FM transmission and, in the GO 920, dead reckoning – again demonstrated TomTom’s capacity for sustained innovative leadership.

TomTom HOME, our online portal for products and services, announced its one millionth registered user in March, and continued to build on this healthy start throughout the year, with our 3.5 millionth user joining at the end of 2007. This was very encouraging, as the strength of this global online community of TomTom users underpins and adds considerable value to key elements of our strategy, such as Map Share and our intelligent routing database.

SAFETY FIRST
At the beginning of the year, a study commissioned by Aon, Athlon Car Lease, Delta Lloyd (part of Aviva) and TomTom, and carried out by the Netherlands’ leading independent research institute TNO, proved the positive influence satellite navigation devices have on both driving and road safety. The study concluded that satellite navigation significantly lowers driver stress levels, leaves the motorist more in control, and reduces miles driven by 16% and travel time when driving to an unfamiliar destination by 18%. This is good news not only for TomTom and our customers, but for the environment as well.

BRAND VALUES
TomTom also unveiled its new corporate identity and logo in 2007. The new identity retains all the unique TomTom brand values that score so highly with consumers, but now better reflects the full portfolio of navigation, tracking & tracing, and traffic solutions that we today offer to consumers, businesses and government agencies.

The new logo is an evolution of the previous one. In just a few years, TomTom has grown into a well-established global company and the leading brand in portable navigation solutions. The new logo reflects these developments and symbolises our care for our customers, hands-on mentality and passion for optimal, high-quality navigation products and services.

CUSTOMER SUPPORT
We believe TomTom products are the best available on the market, and back this up with the best available after-sales support.

Customer Support is one of the most valuable resources we can offer our customers and a genuine strategic asset to the Company. It is the principle means by which we discover what our customers need, and what they do and don’t understand about our products and services.

Synchronising that feedback with our product management and marketing teams, and thus with our product development plans, delivers value that goes far beyond simply solving customer problems. It helps us identify areas where we can further expand our business and improve our products and services.

Our customer support department continued to grow in 2007, in line with the rapid expansion of the TomTom user-base. As a result of all the feedback we received we were able to regularly update our FAQs knowledge database, a useful tool that large numbers of our users regularly consult to learn tips and tricks from other users, which in turn leverages the expertise of our support function efficiently and cost-effectively.

At year-end, TomTom was supporting customers in 15 different languages across 30 countries.

GEOGRAPHICAL COVERAGE
During 2007, our geographical coverage expanded to add Brazil, Japan, Latvia and New Zealand to the list of countries where our products are sold. By year-end, TomTom products were available in 30 countries on 5 continents.

In Europe, TomTom products were available in 21 countries and we continued to enjoy a stable leading market share. In North America, 2007 saw TomTom further increase market share. Thanks to our strong growth in the US market, our European revenue share decreased to 80%, from 90% in 2006, while revenue share from the US increased to 16%, from 8% in 2006.

TOMTOM MOBILITY SOLUTIONS
Following our announcement in 2006 of a strategic alliance between TomTom and Vodafone Netherlands to jointly develop breakthrough traffic data technology, we introduced our new premium traffic service TomTom High Definition Traffic (HD Traffic) in November 2007. The HD Traffic service is available for the first time with the new TomTom ONE XL HD Traffic, with other devices to follow.

An accessory that enables people who already own a TomTom to receive HD Traffic without having to buy a new device will be launched in early 2008.

In June 2007, TomTom and Vodafone UK announced the planned introduction of HD Traffic to the UK during the first half of 2008 and in early 2008, we announced with Vodafone Germany the planned introduction of HD Traffic to Germany during the second half of 2008. Our goal is to have HD Traffic available for 50% of our European customer base by the end of 2008.

(For more about HD Traffic, see New Services – page 24).

AUTOMOTIVE
It is difficult for car manufacturers to develop integrated satellite navigation systems that meet consumer demands for cost effective, easy-to-use navigation with the latest innovations of the PND industry. Bringing our extensive navigation experience and innovation capabilities to the automotive industry therefore is an integral part of TomTom’s long-term business strategy.

In the second quarter of 2007, we created a business unit that will focus on developing and selling navigation systems and services to the automotive industry. With this automotive team, based in new offices in Eindhoven in the south of the Netherlands, we are accelerating the build-up of our automotive expertise and R&D capabilities. To strengthen the Eindhoven unit, in the second quarter we acquired a dedicated and experienced automotive team, formerly working for Siemens VDO, to service car manufacturers and OEMs.

In October, we announced the availability of the world’s first portable navigation device embedded at the car manufacturer. The latest Toyota Yaris comes with the option to include a TomTom PND as part of its built-in radio system. This new solution offers the motorist the best of both worlds: all the advantages of Tom-Tom’s easy-to-use PND user experience in an embedded system that fits seamlessly into the radio as part of the Yaris dashboard.

TomTom continues to expand its automotive product range. This will include integrated navigation systems embedded in car dashboards that, in combination with TomTom HOME and our extensive service portfolio, will significantly enrich the motorist’s navigation experience.

TOMTOM WORK
TomTom WORK provides businesses with Connected Navigation solutions that combine our award-winning navigation with tracking & tracing, reporting and two-way communication between fleet manager and fleet vehicle drivers. We have grown into the business-to-business area with an easy-to-use product that offers options to suit the needs of fleets of all sizes.

In 2007, TomTom introduced the world’s first truly connected PND, the TomTom GO 715, with a built-in SIM card for commercial vehicles that offers a combination of navigation, two-way data communication and traffic information through either the basic COMPACT or more advanced ACTIVE solutions. These we see as meeting the needs of another critical sector in the B2B market.

TomTom WORK is active in six countries on two continents, and during 2007 more than doubled the number of its subscribers to 34,000 by year-end, from 14,000 at the end of 2006.

OFFER FOR TELE ATLAS
In 2007 we announced an all-cash offer for all of the issued and outstanding ordinary shares of Tele Atlas. This offer has the support of the Management Board and Supervisory Board of Tele Atlas and is approved by TomTom’s General Meeting of Shareholders.

We believe that the navigation industry will change significantly in the next few years. We are already seeing an increasing demand from map users for access to intelligent routing and up-to-date maps. Validating maps, detecting changes in the road network and providing current data in the form of updates is critically important to all Tele Atlas customers. Tele Atlas’ current map creation, enrichment and maintenance process is lengthy and expensive, taking months before a new map version with corrected data is released. The current map maintenance process perpetuates a suboptimal navigation experience for customers.

At TomTom, we have developed unique technologies to collect and process map related data from our user base of over 15 million navigation devices. This information will be delivered to Tele Atlas after the proposed merger, allowing Tele Atlas to substantially speed up and improve its map creation, enrichment and maintenance processes. The improved maps will then be made available to all Tele Atlas’ customers. We will also introduce new product features, such as intelligent routing.

After completion of the acquisition, the combined company will possess the technology, data and economic strength to continually improve the quality of Tele Atlas’ maps and provide more accurate navigation information. The combined company will improve all aspects of the digital map maintenance, enrichment and creation processes. This will result in better maps produced more efficiently and updated more frequently for the benefit of all current and future customers.

The aggregate value of the proposed transaction is approximately €2.7 billion, including the net financial cash position of Tele Atlas. We will finance the transaction by using available cash and fully committed bank finance.