1 Welcomes

2 CBS Vision Presentation To CABA David F. Poltrack Chief Research Officer, CBS Corporation President, CBS Vision

3 CABA DIGITAL HOME FORUM

4 “Participants will be engaged to openly discuss current research strategy as it relates to the connected current research strategy as it relates to the connected home sector and their respective organizations” home sector and their respective organizations”

5 Not just connection…Commitment David F. Poltrack Chief Research Officer, CBS Corporation President, CBS Vision February, 2011

6 CBS has just completed the latest wave of its on-going New Entertainment Technology Research Program at our state-of-the-art Television City research facility in Las Vegas. This program, which began in 2004, has allowed us to monitor the scope and speed of the transition of the U.S video market from a one-screen, linear market to its current three-screen, non-linear form. In our research, we have discovered the changes in connection provided by the new technologies to be transformative in terms of expanding the consumer’s connectivity and providing access to video entertainment. We have also found the new technologies effective in altering the consumer’s information- gathering processes. However, to-date, we have found these technologies to be having less impact on the entertainment options chosen by the consumer. In this case, greater connectivity does not appear to be leading to a commitment on the part of the consumer to substantially change his or her consumption of video entertainment content. If the adoption of new technology does not lead to a commitment to behavioral change on the part of the consumer, then that consumer is unlikely to continue to place a high value on that technology. Not just connection…Commitment

7 Television City

8 HOME TECHNOLOGY SURVEY IMMERSION RESEARCH  INTERACTIVE SURVEY  PRODUCT DEMONSTRATION

9  20 Focus Groups  Adults  18-34= 42%  35-64= 57%  No Dependent Young Adults  Sample = 232  College Grad= 66%  Median Income= $101,000  34 States Represented Television City New Technology Focus Groups December January 2011

10 COALITION FOR INNOVATION IN MEDIA MEASURMENT-CIMM Total industry initiative to foster new audience measurement research solutions  Charter members include:  CBS  NBC/UNIVERSAL  DISNEY-ABC TV GROUP  ESPN  FOX/NEWS CORP  TIME/WARNER  VIACOM  DISCOVERY  Charter members include:  STARCOM/MEDIAVEST  WPP/GROUP M  OMNICOM  INTERPUBLIC  P&G  UNILEVER  ATT

11 COALITION FOR INNOVATION IN MEDIA MEASURMENT-CIMM Total industry initiative to foster new audience measurement research solutions  TOUCHPOINTS  TAXI

12 ETHNOGRAPHIC RESEARCHETHNOGRAPHIC RESEARCH LIMITATIONS  LIMITED SAMPLES  COOPERATION BIAS

13 ETHNOGRAPHIC RESEARCHETHNOGRAPHIC RESEARCH  TOUCHPOINTS  VIRTUAL APPROACH

14 Video Market Segmentation CONVERGENCE CONCEPT “TV Centric” “Old School” “Web Centric” “Fully Connected”

15 Video Market Segmentation TOTAL ADULTS – SPRING 2006 Source: MRI, Spring 2006 “TV Centric” “Old School” “Fully Connected” “Web Centric” 24% DIGITAL TV, NO BROADBAND DIGITAL TV AND BROADBAND 16% BROADBAND, NO DIGITAL TV 35% NO DIGITAL TV, NO BROADBAND 25%

16 Video Market Segmentation TOTAL ADULTS – SPRING 2010 Source: MRI, SPRING 2010 “TV Centric” “Old School” “Fully Connected” “Web Centric” 16% DIGITAL TV, NO BROADBAND 50% DIGITAL TV AND BROADBAND 17% BROADBAND, NO DIGITAL TV 17% NO DIGITAL TV, NO BROADBAND

17 Video Market Segmentation TOTAL ADULTS – SPRING 2011 Source: MRI, SPRING 2011 “TV Centric” “Old School” “Fully Connected” “Web Centric” 16% DIGITAL TV, NO BROADBAND 55% DIGITAL TV AND BROADBAND 16% BROADBAND, NO DIGITAL TV 13% NO DIGITAL TV, NO BROADBAND

18 DIGITAL TV AND BROADBAND “Fully Connected” 76% (159) NO BROADBAND, NO DIGITAL TV “Old School” 2% (10) DIGITAL TV, NO BROADBAND “TV Centric”15% (90) Source: MRI, Spring 2010; Percent that Own a DVR, ( ) Index to Total U.S. BROADBAND, NO DIGITAL TV “Web Centric” 7% (40) Video Market Segmentation OWN A DVR – SPRING 2010

19 DIGITAL TV AND BROADBAND “Fully Connected” 80% (145) NO BROADBAND, NO DIGITAL TV “Old School” 1% (7) DIGITAL TV, NO BROADBAND “TV Centric”12% (79) Source: MRI, Spring 2010; Percent that Own a DVR, ( ) Index to Total U.S. BROADBAND, NO DIGITAL TV “Web Centric” 6% (40) Video Market Segmentation OWN A DVR – SPRING 2011

20 Fully Connected Consumers Broadband+Digital TV Package Source: MRI

21 CBS Annual New Technology Research Watched Video on the Internet Source: CBS Television City, December Each Year

22 CBS Annual New Technology Research Watched TV Episodes on the Internet Source: CBS Television City, December Each Year

23 CBS Annual New Technology Research Have a DVR Source: CBS Television City, December Each Year

24 CBS Annual New Technology Research Have VOD service Source: CBS Television City, December Each Year

25 CBS Annual New Technology Research Ability to stream or download content on cell phone Source: CBS Television City, December Each Year

26 CBS Annual New Technology Research Netflix Subscriber Source: CBS Television City, December Each Year

27 CBS Annual New Technology Research Evening Television Viewing Evening Television Viewing Source: CBS Television City, December Each Year

28 Source: NTI DVR Homes vs. Non-DVR Homes – A18-49

29 A18-49 as a Percent of Total Adult Population Source: Nielsen Universe Estimates

30 A18-49 as a Percent of Total Adult Population (Est.) Source: Nielsen Universe Estimates

31 A18-49 is a Stagnant Market Source: U.S. Census Bureau Year-Over-Year Growth Projections A18-49 A50+

32 New Season “Buzz” PRIMETIME

33 Mode of Discussion – Ages Source: Keller Fay Group’s TalkTrack, Sepetmber 2011; N=700

34 Mode of Discussion – Adults 18+ Source: CBS Entertainment Panel, September 2011, N=3,300 In which of the following ways have you discussed new television programs with other people? Select All that Apply.

35 Primary Mode of Discussion Source: CBS Entertainment Panel, September 2011, N=3,300 In which of the following ways have you been most likely to discuss new television programs with other people?

36 Mode of Discussion – Adults Source: CBS Entertainment Panel, September 2011, N=3,300 In which of the following ways have you discussed new television programs with other people? Select All that Apply.

37 NETFLIX

38  Subscribers: 20,000,000 (U.S + Canada)  Growth: +63%  At peak times accounts for 20% of U.S. bandwidth consumption  Nielsen Sample: 17%  Entertainment Panel: 37%  New Technology Groups: 43%  Lapsed Subscribers: 13%  Very/Somewhat Likely to Subscribe this year: 10%

39 Sources of on line television programs  YouTube41% 31% (32%)  Network Television Sites54% 73% (71%)  Cable Television Sites33% 33% (34%)  Google Video 9% 3% (11%)  Hulu57% 48% (19%)  Facebook 8% 5% ( 5%)  Netflix35%  iTunes16% 9% (11%)  Yahoo Video 6% 1% (7%)

40 Frequency of StreamingMoviesTV Shows Several Times Per Week27%26% Once a Week16%8% Several Times per Month29%20% Once a Month 9% Less than Once a Month 9%16% Never 9%20%

41 Streamed Last WeekMoviesTV Shows Monday29%35% Tuesday28%33% Wednesday29%33% Thursday26%33% Friday39%35% Saturday42%34% Sunday32%31%

42 Streaming FromAnyMoreLess Game Console49%56%13% Blu-Ray Player18%48%13% HDMI Cable11%45%18% Laptop 38%32%24% Desktop 22%24% 32%

43 Streaming FromAnyMoreLess Game Console49%56%13% Game System Nintendo Wii60% Sony Playstation 332% X-Box 36030%

44 Streaming FromAnyMoreLess Game Console49%56%13% Blu-Ray Player18%48%13% HDMI Cable11%45%18% IPTV 6%57% 4% TiVo 5%49%10% Apple TV 3%75% 0% Google TV 1%75%25%

45 Thank You