C O F A N B S U Y M E L I T R

There are an awful lot of them

Three out of four are now streaming Rest Music Streamers

The number of paying customers is recovering +5%

$119 Per capita ANNUAL spend on “Recorded Music”: 1999 Estimate; Inflation Adjusted Population 13+; revenue from RIAA $119 FRAGILE RECOVERY

Per capita ANNUAL spend on CDs, DDLs, Vinyl & Interactive Subscriptions US Internet Population 13+ $24 $1,092 $300 $43 $60 live...Complements

FRAGILE RECOVERY

+150% 26 Million US

+150% 26 Million US 58M January 67M June

How does paid streaming go from 26M (US) to 100M??? Internet Population 13+: 240M 80% Stream 2 Users Per Account

Nearly 60% of Free Streamers use a free service exclusively Ave month..155 stream hour or more. Pract all use a free service. 65 used a paid (free, shared, self pay- closer to 30). About 90 are free only. Diff between paid and free tends to be age, incone, but it’s more...subscription ethos...Netflix, hulu, showtime prem cable, newspaper, gaming. They get the value of subs. Average Monthly Usage (Listening); Stream 1+ Hours: 2016 (Internet Population 13+)

What are the main reason(s) you have not paid to subscribe? Economic, demographic, psychgrapic, and marketing too Among non-subscribers (on demand or online radio streaming service)

What are the main reason(s) you have paid to subscribe? No ads Done Among non-subscribers (on demand or online radio streaming service)

44% $100K + Income 24% Hispanic 55% Male

20% of the Internet Population GEN Z may be the most music engaged generation ever 44M aged 13-22 20% of the Internet Population Shazam Spotify Apple Music VEVO DL app for free music “Pirate/Share” Use Free or Paid On Demand Pay for On Demand Subscription Buy artist merch DL other apps (games) Spend more time than others on music Invest time to discover music Do research on artists Sharing recommendations Have music everywhere I go A lot of new music I want to buy Use music apps most often on phone The new Woodstock generation Premium Headphones Wireless/Bluetooth Speakers Sonos PAD’s

Music listeners value user experience over most other features

AM/FM dominates in the car...

Among paid streamers, passed the tipping point

3 of 4 interested in streaming in car; integration, voice, wi-fi all lubricants

Because I am using a Personal Assistant Device, I am Because I am using a Personal Assistant Device, I am...(agree to doing more) 11%

THANK YOU russ@musicwatchinc.com 631-470-4982