1. Changing TV Landscape
June 2013

2. Changing Television Landscape
TV distribution and consumption are changing all over the world
In the U.S. and other developed markets, new devices and platforms are driving increased programming consumption
In international territories, traditional pay television platforms continue to grow, adding new channels and viewers
Hit shows and formats created in the U.S. are finding a more global audience; at the same time, the market for local programming is thriving
The result is an increased demand for new and library content, and programmed channel experiences

3. Connected Devices such as Tablets, Smartphones, Consoles, & Smart TV’s are Enabling Ubiquitous Consumer Access to Content
Over the next 4 years, connected device ownership is expected to grow at a 13% CAGR
(1)
(2)
(3)
(4)
Source: SNL Kagan. Number of devices in millions.
Applies to Internet-connected video game consoles used to access professionally produced content. Excludes multiple video game consoles per HH.
Stand-alone set-top boxes including, but not limited to, Apple TV, Roku, Boxee and TiVo. Excludes set-tops integrated with multichannel service
Internet capable TVs and blu-ray units that are connected and used for OTT video. Excludes overlap of devices.
Applies to households using a PC or media server to transfer OTT delivered content to the TV. Excludes households viewing content directly on PC screen. 3

4. Connectivity and Devices are Driving Online Viewing
(1)
CAGR: 9.5%
Penetration
40%
55%
Does not represent cord cutters but applies to households regularly viewing television shows or movies using Internet or over-the-top (OTT) delivery, most online/OTT video HHs in the above graph also subscribe to multichannel services. Source: SNL Kagan, September 2012.

5. The Emergence of Online Viewing Has Created New Options as Consumers Seek Flexibility
TV Everywhere
Over-the-Top (OTT)
Traditional MSOs (i.e., cable & satellite) and networks are adapting their services to accommodate online viewing
New digital networks have emerged taking advantage of the ability to go directly to the viewer without an MSO middleman

6. By Adding Digital Services to Traditional “Linear” Channels, There is Greater Demand for Content
Digital services also create renewed demand for library programming
Broadcast
Basic/Premium Cable
US Landscape
Digital Services 6

7. Networks are Under Greater Pressure to Distinguish Themselves and Attract Viewers
Original programming is increasingly used to differentiate their content propositions
Potential for emphasis to shift
Originals
Exclusive licensed content
Non-exclusive library product

8. Traditional Linear Networks Est. Annual Content Spend
Both Traditional Networks and Digital Services are Spending More on Programming
Traditional Linear Networks
New Digital Services
Annual Content Spend
Growth
Est. Annual Content Spend
$2Bn+
$500MM+
19%
$475MM+
14%
$500MM – $1Bn
$940MM
10%
$500MM
$650MM+ 1%
Note: Content spend as of fiscal year ended December 31, Growth calculated as CAGR.

9. Digital Services are Now Beginning to Compete with Linear
Source: BTIG May 21, 2013.

10. Global Pay TV Households (MM)(1)
Pay TV Also Continues to Grow Internationally, Creating New Opportunities for Programmed Channels
Global Pay TV Households (MM)(1)
CAGR: 4.4%
Penetration
54%
59%
Source: Informa (1) Pay TV Subscribers include Digital Cable, Analog Cable, Pay IPTV, Pay DTH, and Digital Pay Terrestrial TV households.

11. Worldwide Market for U.S. Produced Programming ($BN)
The Proliferation of International Channels is Increasing the Demand for US Studio-quality Content
Worldwide Market for U.S. Produced Programming ($BN)
CAGR: 5.0%
Source: SNL Kagan 2013. 11

12. Sony Pictures Television: Highlights
SPT is well positioned to take advantage of the changing TV landscape     
Global Pay TV Growth
Networks projected to have an EBIT CAGR of 23% across the plan, coming from all regions across the world as newer channels mature to profitability and more mature channels grow or maintain their margins
New Distribution Opportunities
Distribution continues to grow given new buyers and opportunities with SVOD and a strong global Pay TV market
International Distribution sells in over 300 countries/markets and US Distribution sells in over 200 US markets
Crackle positioned as top ad-supported channel on multiple platforms; breaking new ground with original production, distribution across platforms, and global expansion
Increased Demand for Content
Most successful production slate in a decade with SPT receiving orders for eight new scripted series
Currently producing 33 programs for 17 US networks
(More international buyers seeking U.S.-created content )      

13. SPT Embraces Change
An industry leader constantly shaping and adapting to new trends, SPT has experienced significant growth and has become the largest contributor of profitability to SPE
Total TV = 37%
Total TV = 60%

14. SPT Networks: Global Expansion
SPT is capturing the subscriber growth trend by continuing to expand our channel presence internationally through new channel launches and targeted acquisitions in key growth areas
159 COUNTRIES
804 MILLION HOMES
124 FEEDS
22 LANGUAGES
EUROPE & RUSSIA
KOREA
NORTH AMERICA
JAPAN
ASIA
AFRICA
LATIN AMERICA
AUSTRALIA

15. SPT Networks Adapting to Changes in Consumer Behavior
SPT’s broader network strategy also recognizes new distribution platforms and consumer behavior
SPE already owns a premium content OTT digital network with Crackle
Top ad-supported premium content service that is available across all platforms; broader audience reach than several top paid services, including Hulu+ and Amazon
Top ad-supported channel on key platforms (Top 5 channel on Bravia, Blu-ray, and Roku)
Crackle expanding device and territory footprint to capitalize on growth in alternative consumption models
Expanding Reach of Linear Networks
Evaluating direct-to-consumer apps (e.g., AXN Go in LATAM) with cable/sat partners
Participating in existing local TV Everywhere offerings of cable/sat partners (e.g., Singapore)

16. SPT Distribution: Growing Buyer Pool
International distribution continues to grow given new buyers and opportunities with SVOD and a strong global Pay TV market. The team has continued to build relationships with content buyers both domestically and internationally which is directly reflected in the growing number of SPT customers to whom we sell.
Domestic
International
Source: SPT analysis.
Note: Domestic count does not include local affiliates of national networks already included.

17. SPE Distribution: Shift in our Revenue Mix
SPE has capitalized on the shift in consumption patterns, and our revenue mix today reflects the emergence of new markets and partners (ex. Community on Netflix).
U.S. Revenue Mix
International Revenue Mix
Source: SPT and SPHE finance.

18. SPT: U.S. Production
SPT has had the most successful production slate in a decade with SPT receiving orders for seven new scripted series. SPT’s increased production slate reflects our success creating original television content to satisfy a greater demand for our product
New Series
Returning Series
98 pilots ordered for 2013 – 2014 pilot season with 50 pick-ups
Comedy – 22 new
Adaptations
 Trusted Auspices
Serialized Drama
Character-Driven Procedurals
Limited Run Series & Events
Scripted Programming in Summertime
Note: Excludes Wheel of Fortune, Jeopardy!, The Young and the Restless, and Days of Our Lives.

19. SPT: International Production Building a Worldwide Presence
Miami
(Latin America/USH)
Bogota
Sao Paolo
Rome
Cologne
Moscow
Beijing
Hong Kong
Dubai
Beirut
Cairo
Paris
London
Amsterdam
AMERICAS
EMEA (Europe, Middle East, Africa)
ASIA
Culver City
Companies in 13 countries around the world covering multiple regions;
Programs aired in 88 countries, 73 languages and counting…
Tuvalu

20. Q&A