Adi Bar-Dagan Meyrav Elad Emanuel Hachamov Achinoam Levy Nocham Ohana Maxim Vainstein Kfir Yadgar Roy Zuckerman

The Need Low TRP / GRP - $30 Billion Waste Unspecific target audience Greater competition in Multi-Channel TV Studies indicate a need for targeted advertising from the consumer’s point of view

Advertising routing system based on one to one broadcasting Personalized user profiling Advertisements presented to specific viewer in accordance with personal profile. Response server allowing user-advertiser interaction The Product

Data collection and aggregation: Interactive questionnaires – demographic data and preliminary viewers preferences. User Interaction – Enhancement and tweaking of personalized profile. Continuous Analysis of viewing habits. The Product

STB with substantial storage capacity Client-Server connection Software installed remotely on viewer’s digital set top box Constant update of set-top Ad database Technology Overview Technology Overview

Data analysis through learning algorithm Response Aggregation through Return Channel Compatible with the leading middle-ware operating systems Technology Overview

The Market US Advanced STB Forecast Forecast: US Digital Cable and Satellite Penetration * Source : Forrester Research

By 2006 there will be over 45 millions households (u.s) using interactive TV. TV Advertising revenues (2001, in Billions): -Broadcasting Networks – $16.8 -Cable Networks – $10.1 -Infrastructure Companies – $2.7 * source: Forrester research, Jupiter Communications The Market

* Source: People Meter The Market

NDS Wink NAVIC AD-EXACT ACTV AdQ Company Personal Profile Response Server Profile Updating Ad Routing Return Channel Active Clients Competitor Analysis

Two revenue streams: Licensing fee from content providers* Advertisers fees from “more info” requests * Profit Sharing with infrastructure companies Business Model

* Source: People Meter Business Model

Expected TRP/GRP – 70% (40% growth) 30% expected increase in revenues (Full Deployment) Revenue split 10% to each party (Content, Infrastructure, AdQ). One–Two year license at predetermined price. Business Model assumptions

System initial installment by AdQ System maintenance and operation by infrastructure companies Long term contracts with infrastructure companies Business Model Assumptions

Revenues (in millions US $) AdQ Market Share Digital STB Deployment Total TV Ad Revenues* Total Added Value by AdQ 45%55%65% 5% $36,300 $245 10%15% $43,100$52,400 $711$1,533 AdQ Revenues $82 $237$511 * Source: Financial Times

Stand Alone Applications – 8/2002 Prototype – 8/2002 Beta Version – 2/2003 Version 1.0 – 8/2003 Final Release – 10/2003 Development Plan

Direct Sales – US Market first - Infrastructure companies - Cable and DBS content companies - Broadcast Networks Area by Area roll-out Marketing Plan

Income Statement (in thousands US $) R&D Revenues Operations Cost Total Cost $82,000$237,000$511,000 $13,050 $20,525 $33,575 $28,650$45,500 $43,277$52,420 $71,927$97,920 EBITDA $48,425 $165,073$413,080 Required Funding for : 10 Million Dollars

Consumer behavior – “couch potato” and “lay-z-boy” phenomena Growing variety of content channels Middleware manufacturers embedding software features New technologies (PVR etc.) Insufficient financial resources Risks