CONFIDENTIAL Digital Services and Distribution Acquisition Strategy November 28, 2006

page 1 Executive Summary SPE committed to digital services to help address challenges with core businesses –Accelerates revenue growth through participation in online advertising –Offers higher margins than traditional business lines Grouper provides a solid foundation. Incremental investment will help further develop Grouper and expand SPE’s presence to achieve overall digital services strategy –Grouper offers technology, infrastructure, management, and initial traction with customers –Consolidation is raising the threshold for minimum audience size and content offering –Online video syndicators are building networks of loyal advertisers and distribution partners We would like to move ahead to evaluate leading targets, with deal proposal targeted before the end of the calendar year –Break ($75MM- $125MM) and Heavy ($150MM - $200MM) control quality content with large audiences in a key demographic –Roo ($125MM - $150MM) combines a large base of aggregated content, syndication partners, and monetization capabilities

page 2 Grouper Provides a Solid Foundation, But Requires Time and Resources to Achieve Stated Goals Content Audience Functionality Small base of UGVOriginal digital content Licensed content Prosumer content Grouper at Acquisition1 st Year Development Demonstrated traction with targeted audience Leverage SPE marketing and promotions Build distribution network Differentiated user experience Robust infrastructure Enhance feature set Improve embedded player

page 3 Market Evolution Raises Minimum Success Requirements and Requires Accelerated Execution Google’s acquisition of YouTube raised the bar for minimum base of content and users required to succeed Ongoing investments by new media (Yahoo!) and traditional media competitors (Viacom, NewsCorp) increases competition for content and audience Sites like Break and Heavy control a large base of targeted, high-quality content and are building leading brands while capturing audience Aggregators / syndicators like BrightCove and Roo are licensing content and building relationships with advertisers Other larger opportunities, like PhotoBucket, could bring value to Sony more broadly but would require additional commitment and coordination

page 4 Content Audience Functionality SPE Response to Market Evolution Must Address Increased Competition for Content and Audience Market Inception Develop or License Acquire Prioritize services that pair owned content with large high value audience Avoid sites with audience but no differentiated content Wide range of sites, little content focus Multiple sites growing in lock-step, no critical mass Limited functionality Media companies pair studio content with UGV sites (Viacom/Atom; NewsCorp/MySpace) Sites with large base of owned content capture high value demographics (Break, Heavy) Functionality is increasing but is not the primary draw Acquisitions raise the bar for minimum audience size (Google/YouTube) Market Consolidation Recommended SPE Response

page 5 Content + Audience Break.com (3.3) eBaum’s World (3.0) Bolt.com (2.9) Heavy.com (2.7) Roo Media (N/A) BrightCove (N/A) Functionality + Audience PhotoBucket (12.0) Six Apart (10.4) Image Shack (9.3) Xanga (5.5) Reunion (4.7) MetaCafe (3.1) Digg (2.1) Putfile (1.4) Friendster (1.0) May be Prohibitive Content College Humor (0.9) JibJab (0.6) Revver (0.5) Broadband Sports (0.1) RocketBoom(0.04) Revision3 (0.02) Channel 101 (0.02) Content + Functionality Pure Video (0.9) Castpost (0.2) Now Public (0.09) Bix (0.08) Blip.tv (0.06) Dave.tv (N/A) Functionality Meetup (0.7) Piczo (0.5) Text America (0.5) Imeem (0.2) VideoEgg (0.2) eyeSpot (0.2) MotionBox (0.2) Competitive Landscape and Acquisition Candidates Tier 1 Candidates Tier 2 Candidates Audience Putfile (1.4) DailyMotion (0.8) vMix (0.8) vidiLife (0.8) ManiaTV (0.6) Vimeo (0.5) Monthly unique users per Nielsen Net Ratings; may under represent audience for smaller sites Although audience for independent sites generally remains a fraction of YouTube’s 30MM unique users; sites with compelling content have built larger audiences than niche content or pureplay functionality sites

page 6 Leader with male youth, ages Owns a large base of compelling content Strong advertiser relationships 9.2MM$75MM-$125MM Based on early guidance from Montgomery Large, syndicated audience Relationships with content providers, advertisers, and web site partners 5.8MM$125MM - $150MM Public but thinly traded, will want a premium Audience skews toward males age Owns all content including mix of video, animation, and games 7.8MM$150 - $200MM Description Valuation Range Users (1) Company Leading Acquisition Candidates (1)Monthly Unique Users for Break.com based on Nielsen SiteCensus audit; RooTV users based on Comscore estimate of unique video streamers on-site and through third parties; Heavy.com based on Comscore Media Metrix; PhotoBucket based on Comscore Media Metrix Tier 1 May be Cost Prohibitive Hosts photos and videos, enables publishing to sites like MySpace and Blogger 14.5MM$250-$450MM Based on rough guidance from Jeffries Content aggregation and distribution (competes with Roo) Strong content/advertiser relationships N/A$230 - $255 Guidance is for venture round, acquisition price may be higher Viable acquisition candidates combine content and an attractive audience at valuations below $150MM Priority Potential Cross-Sony Opportunity

page 7 Next Steps Initiate conversations with Tier 1 acquisition candidates Analyze and value acquisition targets Reconvene in two weeks to discuss potential acquisition offers