Over-The-Top Video and Mobile Video TV HPA February 17, 2010 Gary Arlen Arlen Communications Inc.

Over The Top Television Internet-delivered TV 230 million (global) “Web-enabled stationary CE devices” by 2013 Up from 32 million in 2009 (global) – Game consoles, Blu-ray players + TV sets 500+ million devices (including mobile/portable) Half of global HH will have Web-enabled device by % are so equipped today Used for catch-up and VOD viewing Original content? Source: In-Stat, Jan (c) 2010 Arlen Communications Inc.2

OTT: Where the Shows Are Internet video providers have made deals with TV set makers and providers of other access devices. Selected examples (January 2010): Sources: Screen Digest, Parks Associates, Arlen Communications Inc. 3(c) 2010 Arlen Communications Inc.

Overall Online Video Usage (U.S.) Jan-10 Year- over-Year Month- over-Month Unique Viewers (000) 142,6685.2%3.8% Total Streams (000) 11,061,4585.8%3.1% Streams per Viewer %-0.8% Time per Viewer (min) %-2.3% Source: The Nielsen Company, Feb (c) 2010 Arlen Communications Inc.

Source: comScore Jan 2010 ~90% of Internet users watch online video

ALTERNATIVES: Over-the-Top Video Developing new revenue models HULU will charge for shows next year Disney “KeyChest” - multi-platform Next-generation Apple TV? What’s next for Boxee, Sezmi, Vudu, etc. Failure of Veoh? What kinds of video? (c) 2010 Arlen Communications Inc.6

TV Widgets On-screen info and show supplements Ad opportunities/enhancements Web-enabled TV sets 2009: 400, : 13.8 million Source: Parks Associates, Sept % of consumers believe that having a widget dock on primary TV set would be “valuable” Source: The Diffusion Group, September Each family member can build custom widgets Yahoo, Google, others supplying developer kits 7 (c) 2009 Arlen Communications Inc.

Broadband Tries to Stay Competitive Broadband Tries to Stay Competitive Making a comeback with on- screen widgets Viewers can buy widgets, just like Apps – Program enhancements – Additional information and ads – Participatory TV – AT&T uVerse: Dallas pick your camera angle Sports events Similar to ACTV, Videoway of 1990s. 8(c) 2009 Arlen Communications Inc.

Over The Air Mobile Video Competing products arriving simultaneously Consumer confusion OMVC Sustaining the Broadcast model FLO TV Super Bowl commercials Mobile Internet Olympics commercials iPhone/iPad video options (c) 2010 Arlen Communications Inc.9

Coming Up FCC National Broadband Plan Due to Congress March 17 Integrates spectrum issues Inevitable court/Congress review “Spectrum grab” Inevitable use of airwaves Long term impact Serving viewer appetites Or business objectives? (c) 2010 Arlen Communications Inc.10