Worldwide Over-the-Top Subscription Video on Demand Market October 2013

Table of Contents  Introduction  Research Objective  Methodology  North America OTT SVOD Market – Overview – Challenges and Opportunities – North America OTT SVOD Market Forecast ( )  Western Europe OTT SVOD Market – Overview – Challenges and Opportunities – Western Europe OTT SVOD Market Forecast ( )  Asia OTT SVOD Market – Overview – Challenges and Opportunities – Asia OTT SVOD Market Forecast ( ) Copyright © 2013 SNL Financial LC 2

Table of Contents  Eastern Europe OTT SVOD Market – Overview – Challenges and Opportunities – Eastern Europe OTT SVOD Market Forecast ( )  Latin America OTT SVOD Market – Overview – Challenges and Opportunities – North America OTT SVOD Market Forecast ( )  Middle East-Africa OTT SVOD Market – Overview – Challenges and Opportunities – Middle East-Africa OTT SVOD Market Forecast ( )  Worldwide OTT SVOD Market – Overview – Worldwide OTT SVOD Market Forecast ( ) – OTT SVOD Market Share by Region vs Copyright © 2013 SNL Financial LC 3

Executive Summary Copyright © 2013 SNL Financial LC4  MRG estimates that worldwide OTT SVOD subscriptions reached 66 million in 2012, generating an annual revenue of US$4.7 billion.  Consumers these days demand a personalized viewing experience and a large variety of content selection. OTT services, allowing for multiscreen viewing options, are well suited to fulfill these expectations.  The ever increasing penetration of smart TVs, smartphones, tablets and other connected devices, worldwide, are further augmenting the demand for OTT services.  As the market is evolving, OTT SVOD service providers are striving to offer exclusivity and original programming to their subscribers. The focus is on providing video content anytime, anywhere and on any device.  MRG expects the OTT SVOD market to record significant growth worldwide in the coming years.

Worldwide OTT SVOD Forecast ( ) Copyright © 2013 SNL Financial LC 5 Worldwide OTT SVOD Subscriptions (in Millions) Worldwide OTT SVOD Annual Revenue (in US$ in Billions)

Definitions and Assumptions  Over-The-Top (OTT) is a system for the broadband Internet delivery of video and audio without a pay-TV operator being involved in the control or distribution of the content.  The Subscription Video on Demand (SVOD) model offers subscribers unlimited access to content for a regular fee (usually charged monthly, quarterly or yearly).  Under the scope of this study, the OTT SVOD market includes only pure play OTT service providers.  The study excludes TV Everywhere services, wherein the pay-TV operator offers content via an OTT platform exclusively to its subscribers. Copyright © 2013 SNL Financial LC 6

7 * Other players in this region include: Bigstar Movies, Acorn TV, TheBlaze TV, Tennis TV, FlixFling, YuppTV, Ustream, WhereverTV, BigFlix, myTV, Vibble TV, Reelzhot, Youtube, TVPolonia.com, SundanceNow, Izogn Movies, FilmOn, Fander, BBC iPlayer, YouTube, Mubi, Acorn TV North American OTT Service Providers, Subscribers and Fees

Overview  North America, comprising XX% of worldwide OTT SVOD subscriptions, contributed significantly toward the growth of the market in 2012, followed by Western Europe with an XX% share.  The United States is the most developed market for OTT SVOD services accounting for about XX% of the worldwide OTT SVOD subscriptions in  The OTT SVOD service markets in Latin America, Asia and Eastern Europe, collectively comprised XX% of worldwide OTT SVOD subscriptions in These regions are expected to record immense growth in the next five years, increasing their overall share significantly.  In 2012, the Middle East and Africa had a negligible share in the worldwide OTT SVOD market. Though the market is expected to grow in the coming years, its contribution to the worldwide OTT SVOD subscriptions will merely increase to X% by  Eastern Europe, Latin America and Asia are emerging markets for OTT SVOD services. Copyright © 2013 SNL Financial LC 8

Methodology  To estimate the current size of the OTT SVOD worldwide market, our team of analysts conducted extensive research using various sources, including journals and whitepapers. The findings in this report have been validated with insights from in-depth interviews with industry experts, analysts, and senior executives of key OTT players worldwide.  Five year forecasts for each region take into consideration a variety of factors including OTT service growth in past years, competitive landscape, profile of the OTT SVOD service providers, consumer acceptance and demands, government rules and regulations affecting the industry, business environment, ease of doing business, size of entertainment and media industry, threat from alternate platforms (pay-TV, DVDs etc.), video piracy, OTT SVOD service share compared to AVOD and TVOD in each region, Internet infrastructure (broadband households, Wi-Fi households, internet speed, service quality), Internet affordability, digital literacy, computer/laptop households, tablet penetration, smart phone users, 3G penetration and deployment of LTE 4G networks. Copyright © 2013 SNL Financial LC 9