State of Global TV Everywhere

Transcription

1 Global Multichannel Special Report State of Global TV Everywhere 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. One SNL Plaza, Charlottesville, VA 2292 Phone: Published April 24 ISBN:

2 SNL Kagan is the ultimate resource for complete financial intelligence and analytics on the broad and dynamic media & communications industry, including the broadcasting, cable, TV network, motion picture, wireline, wireless, satellite, and internet media sectors. The SNL Kagan suite of products integrates comprehensive data, forecasts, expert analysis and breaking news into an electronic database and analytical tools that are available online and updated around the clock. Whether you re an investment banker or media company executive, a research analyst or a portfolio manager, SNL Kagan provides you with unlimited 24/7 access to the relevant information you need to understand evolving trends, anticipate change and make the best decisions. SNL Kagan combines the 4-year heritage of Kagan Research with parent company SNL Financial s 25 years of experience in providing essential guidance to Wall Street and America s top corporations. Research Analysts Associate Research Analysts Managing Editor Publications Project Editor Graphics Artists Julija Jurkevic and Mohammed Hamza Piotr Gaber, Wangxing Zhao and Marcos Rodriguez Luke Meade James Mantooth Rameez Ali and Shirley Gil Unless allowed by a full site license, report material may not be reproduced, retransmitted electronically, including via , intranet or Internet, or recopied in any form, in whole or in part, without prior written permission, whether for internal business use or otherwise. Violators risk criminal penalties and civil damages of up to $5, per offense. We vigorously prosecute copyright infringers. Site licenses are available (for license information contact sales@snl.com). 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. This research report is prepared and circulated for general informational purposes only and is not an offer, nor a solicitation to make an offer, to buy or sell any securities or options, futures or other derivatives related to such securities. Investors should seek financial advice regarding the appropriateness of investment strategies discussed or recommended in this research report. The information contained herein was obtained from sources SNL Kagan believes to be reliable; however, SNL Kagan has not independently verified all the information given in this document. Accordingly, no representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of the information and opinions contained in this research report. Some of the information in this report may be based on historical information, which may not have been updated. Statements regarding past performance may not be indicative of future returns and statements regarding future prospects may not be realized. All opinions and estimates expressed are our current opinions and estimates as of the date appearing on this material only and are subject to change without notice. SNL Kagan, its parent, its affiliates or employees preparing this report may have a position in securities of any company or derivatives related to such securities referred to or recommended in this report. An employee of SNL Kagan, its parent or affiliates may be a director of a company referred to or recommended in this report. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 2

3 SNL Kagan s survey of key pay TV operators across five regions revealed 47 cable, DTH, and IPTV providers offered TV Everywhere services as of February 24. According to our study, the vast majority of TV Everywhere platforms, or 6, are located in Western Europe, 29 in Eastern Europe, 29 in Latin America (including programmer-owned ventures), 9 in North America, and 8 in Asia Pacific. The survey also indicated that only seven operators out of 47, or 4.7%, support all of the six connected device categories PCs, smart TVs, smartphones/tablets, game consoles and mobile video apps, as well as mobile app control. We have identified five such operators in Western Europe and two in North America. All Asian TV Everywhere operators supported smartphones, while all North and Latin American TV Everywhere entities supported PCs, indicating a clear preference for these devices as second screens in the respective regions. TV Everywhere refers to a multichannel business model in which pay TV operators or premium networks allow their subscribers to access video content as part of their TV subscription, including live streaming channels and/or video-on-demand titles, across multiple Internet-connected devices, such as smartphones, tablets, game consoles, streaming players and smart TV sets. TV Everywhere systems leverage user accounts provided by pay TV operators or networks to authenticate the user, thus verifying whether the user is an existing subscriber to a particular TV package or channel. In some instances TV Everywhere services are offered outside of the pay TV environment as over-the-top services open to all broadband users, often supported by a retail set top box. TV Everywhere does not include TV networks multiscreen and OTT services unless they are authenticated or accessed through a multichannel operator s pay TV system. Western Europe As TV Everywhere (TVE) services become an essential part of pay TV in western Europe, it is primarily the historically more advanced satellite TV platforms that have overcome the challenge of defining TVE to ensure resonance with subscribers. SNL Kagan s survey of key pay TV providers across western Europe indicates 79% of the 6 cable, satellite and IPTV operators supported three or more device categories as of Feb SNL Kagan, a division of SNL Financial LC. All rights reserved. 3

4 In the U.K., BSkyB s Sky Go service reached 3.3 million unique users, representing 3% of its TV base of.5 million for the U.K. and Ireland, up by 248, during 23. BSkyB s premium TVE version Sky Go Extra claimed 643, subscribers at end-23. In Germany, Sky Deutschland Fernsehen GmbH reported 7 million customer sessions in 23, up from 33 million in 22. In Italy, Sky Go customers hit 42% of the TV base, with 2 million at the beginning of 24. Modern Times Group MTG AB s Nordic pay TV service Viasat launched the Viaplay multiscreen service in March 2 and has reported strong growth, which SNL Kagan estimates at more than one-third of its base of million subscribers. Strong TVE adoption has provided stability in operators subscriber bases. Nordic operators Viasat and Canal Digital, for instance, report declining losses, while Sky continues to grow its base and the number of products subscribers take this in a saturated environment facing intense competitive pressures from both traditional TV and online video platforms. Moreover, solid TVE performance provides new opportunities for revenue growth via deeper customer engagement and the ability to sell targeted advertising across connected screens. Comparing the latest data collected with surveys conducted in October 22 and July 23, satellite operators have embraced a more comprehensive and consistent approach to TVE, maintaining the highest category scores from launch, while also supporting attractive content offerings across all genres. As such, satellite operators were able to deliver lasting integrated marketing campaigns that promoted TVE s key use cases around content themes such as live sports, news and premium movies. Western Europe TV Everywhere Average Adoption by All Platforms, As of February 4, 24 (%) Total 22 Total 23 Total % 25% 23% 62% 7% 77% 6% 73% 79% 53% 68% 77% 2% 5% 6% 62% 69% 62% 76% 8% 45% 58% 59% 4% 47% 23% 24% 26% Note: 6 operators surveyed in 22, 59 in 23 and 6 in SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 4

5 Few pay TV operators on other platforms have followed such a consistent and strategic approach to building an effective marketing message, hindered by fragmented rollouts and poor service applications at launch. But intense competition is driving a faster pace of innovation. Between Liberty Global Inc. s Horizon platform and TiVo Inc. on cable as well as renewed efforts from IPTV, continued next-generation platform rollouts mean that rival TVE services to satellite s will quickly overcome early challenges that included the lack of multiscreen rights and TV platforms that remain in early maturity. Satellite M7 Group s Canal Digitaal in the Netherlands remains the only major satellite pay TV platform to lack a TVE service, as Greece s Forthnet SA-owned Nova ramped up its offering during the latter half of 23. Nova now offers the Nova Go service, which includes access to premium channel content from NovaSports and NovaCinema. The most notable changes since the last TVE survey conducted in July 23 include support for tablet video apps and the addition of VOD and live TV to the mix for 89% of satellite operators as of Feb. 24, up from across these categories. Canal Digitaal aside, all satellite operators now offer access to on-demand libraries as well as to live TV channels or content. Western Europe TV Everywhere Adoption by Video Platform (DTH), As of February 4, 24 (%) DTH 22 DTH 23 DTH % 67% 89% 56% 56% 89% 89% 89% 89% 67% 89% 67% % % 22% Note: Number of operators surveyed: 9 in 22, 23 and SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 5

6 BSkyB continues to focus on the evolution and integration of existing services, as with Sky Go, a service that effectively merged and rebranded Sky Player online TV and Sky Mobile TV. During 23, BSkyB launched Sky Multiscreen service, combining traditional multiroom TV service with Sky Go. The new service includes Sky Go Extra and offers an additional box for streaming content to TVs and devices around the home. Sky Go Extra, which launched at the beginning of 23, normally costs 5 per month and enables content downloads and use of an additional two devices. The operator made a big leap in TVE in June 2 with the launch of Sky Go, enabling access to live TV, catch-up TV and VOD on PCs, Microsoft Corp. s Xbox 36, tablets and smartphones. MTG reported in its 23 annual report that the Viaplay service had helped boost its pay TV service, including wholesale via other platforms, which it said would have experienced growth if Viaplay adoption were included. Viaplay includes two offers: one is Series + Movies for SEK79, with, films as well as series, documentary, kids, reality and entertainment programs, and the second is Series + Movies + Sport for SEK279, adding the sports element. The Viaplay box offers live TV channels and a full range of VOD and is available as a stand-alone OTT service. The purchase of a Viaplay box enables viewing of live TV channels, instead of only live sports broadcasts, and the full range of VOD content. Cable Cable TVE services have progressed at a slower pace compared to rival platforms, as large and small operators regionwide contend with legacy analog systems and upgrading core TV services. As of Feb. 24, of the 23 cable operators reviewed had launched a TVE service, compared with of satellite and 76% of IPTV operators. In terms of centralized home gateway technologies, Virgin Media Ltd. s partnership with video recorder pioneer TiVo and Liberty Global Inc. s Horizon projects have the highest visibility in seven countries, representing 5% of major cable territories in the region. Horizon launched in the Netherlands and Switzerland during the second half of 22, with other markets joining during 23. Liberty Global reported 5, Horizon TV subscribers at end-23 in the Netherlands, Switzerland, Germany and Ireland. TiVo in the U.K. launched in the first quarter of 2 on the Virgin Media platform, reaching 2 million subscribers at end-23, while ONO s TiVo service, which launched at end-2 in Spain, hit 323,. In October 23, TiVo launched in Sweden on Com Hem s network and upgraded 38, customers to the service. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 6

7 Liberty Global has significantly increased its footprint in recent months, acquiring Virgin Media in the U.K. and driving a major consolidation effort in the Netherlands via a merger of its UPC Netherlands operation with leading cable operator Ziggo. Liberty Global is now present in the U.K., Austria, Ireland, Germany, Switzerland, the Netherlands and Belgium and is the leading cable operator in all except Germany. Cable operators continue to ramp up support for smartphone and tablet video apps as well as for live TV channels, with support for each of the services increasing from 57% of surveyed cable operators as of May 23 to as of Feb. 24. Moreover, cable operators now support significantly more live channels compared with satellite. The number of live TV channels accessible via TVE with Com Hem, for instance, was up to 4, while the rest generally offered at least 3 channels. Satellite operators on average supported 3 live channels but tended to focus more on specific live events or content. Western Europe TV Everywhere Adoption by Video Platform (Cable), As of February 4, 24 (%) Cable 22 Cable 23 Cable % 4% 3% 45% 57% 55% 7% 87% 4% 57% % % 4% 55% 67% 7% 45% 62% 7% 35% 57% 2% 33% 43% 2% 29% 26% 5% 48% 52% Note: Number of operators surveyed: 2 in 22, 2 in 23 and 23 in SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 7

8 IPTV For IPTV operators, bundled services have been the goal from the start, while much of the earlier platform development focused on providing basic TV services as opposed to more advanced services. To compete against incumbent satellite and cable operator control over key programming, IPTV players have had to break down more walls to get noticed. IPTV operators have progressed since the last survey, with 76% (was ) of the 29 IPTV operators covered offering VOD as part of their TVE service. However, 79% (was 9%) offered live TV, typically with more than 3 channels, with the decline due to cancellation of existing services, including Vodafone TV in Spain and Norwegian incumbent telco Telenor ASA s Comoyo service, among others. A number of IPTV operators, including Swisscom AG continue to provide stand-alone mobile TV alongside a TVE offer, while others, including Telekom Austria Group s A mobile TV and France Telecom Group s Orange in Switzerland, have evolved those services to a more complete TVE offering. Western Europe TV Everywhere Adoption by Video Platform (IPTV), As of February 4, 24 (%) IPTV 22 IPTV 23 IPTV % 28% 24% 68% 79% 58% 58% % % 4% 77% 76% 76% 68% 76% 77% 9% 79% 55% 69% 66% 6% 66% % % % Note: Number of operators surveyed: 3 in 22 and 29 in 23 and SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 8

9 % 79% 79% 74% 32% North America North America TV Everywhere Average Adoption by All Platforms, As of February 24 (%) Smart TV Tablet video app Tablet control app Note: 9 operators surveyed. 24 SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. Game console North America is one of the most active regions for TVE, with virtually all major operators offering multiscreen services. SNL Kagan s survey of key pay TV providers in the region indicates 9 operators across the U.S. and Canada had launched TVE services as of % % TVE VOD titles 74% Live TV channels % CI Plus February 24. Among them, all supported PCs and 79% leveraged smartphones and tablet apps for TVE video distribution. By contrast, the TVE adoption rate for game consoles had reached 32%, compared to only % for Smart TVs. In terms of content lineup, 74% of the surveyed pay TV providers have made live linear streaming channels available as part of their TVE offerings. All the operators also provide on-demand video libraries with VOD, PPV and catch-up TV content. Examining TVE operators by platform, SNL Kagan found the region s IPTV providers achieved a score of 4.3 out of 6 in terms of devices that could access authenticated video services as of February 24, calculating to a 7% completion rate. The DTH operators surveyed scored an average of 2.8, a 46% completion rate, while the surveyed cable operators scored 65% across the six categories. North America TV Everywhere Adoption by Video Platform, As of February 24 Cable DTH IPTV (%) (%) (%) % Smart TV 9% 73% Tablet video app 9% Tablet control app 27% Game console % % 82% TVE VOD titles Live TV channels % CI Plus % Smart TV 5% 5% Tablet video app Tablet control app % Game console % % TVE VOD titles Live TV channels % CI Plus % Smart TV Tablet video app Tablet control app Game console % % Cable Note: Number of operators surveyed:. DTH Note: Number of operators surveyed: 4. IPTV Note: Number of operators surveyed: SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. TVE VOD titles 5% Live TV channels % CI Plus 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 9

10 Eastern Europe TV Everywhere Average Adoption by All Platforms (%) % Connected TV 69% 69% Tablet 3% Game Console Eastern Europe Pay TV operators in eastern Europe have continued to deploy TVE services for secondary screen viewing, with IPTV providers playing a leading role. As of February 24, SNL Kagan s survey of key pay TV providers in the region indicates 29 operators from 2 markets had launched multiscreen 69% No. of operators surveyed: SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. TVE services. Among them, 69% of operators had leveraged smartphones, tablet apps and for TVE video distribution. By contrast, the TVE adoption rate for game consoles had reached only 3%. In terms of content lineup, 62% of the above pay TV providers had launched linear streaming channels availability as part of their TVE offerings, while 79% also provided on-demand video libraries with VOD, PPV and catch-up TV content. While pay TV account authentication remains the most common means of accessing TVE services, usually at no additional cost, operators are also exploring diversified business models with pay options. For instance, Russia s VimpelCom has launched a variety of pay TV packages dedicated to Microsoft Corp. s Xbox platform as low-cost multichannel subscription alternatives. TVE services from Poland s Cyfrowy Polsat SA can be accessed by both subscribers and nonsubscribers, but at different costs and with different content lineups. The TVE offer is bundled into the DTH packages. Eastern Europe TV Everywhere Device Adoption by TV Platform Cable DTH IPTV (%) (%) (%) % 6% 6% % 6% 7% Connected TV Tablet Game Console Connected TV Tablet Game Console Connected TV Tablet Game Console % 58% 9% 63% 63% 6% Cable Note: No. of operators surveyed:. DTH Note: No. of operators surveyed: 2. IPTV Note: No. of operators surveyed: SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved.

11 Asia Pacific In the second half of 23, smartphones and tablets were used increasingly by pay TV operators in the Asia-Pacific region to deploy TVE services for secondary-screen viewing. As of January 24, SNL Kagan s survey of key pay TV providers in the region indicates 8 operators from 2 markets had launched multiscreen TVE services, with India s Dish TV India Ltd. and Tata Sky Ltd. and the Philippines Cignal Digital TV being the new entrants since June 23. Among them, all operators have leveraged smartphone apps for TVE video distribution, an increase from 8% in 23, while 94% have launched video apps on tablets, rising from 87% in 23. By contrast, TVE adoption rates for smart TVs, game consoles and PC/Mac computers have all slightly declined. Asia Pacific TV Everywhere Device Adoption (%) Smart TV Tablet Game PC/Mac Console 24 SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. Asia Pacific TV Everywhere Device Adoption by TV Platform Cable DTH IPTV (%) (%) (%) Smart TV Tablet Game Console PC/Mac Smart TV Tablet Game Console PC/Mac Smart TV Tablet Game Console PC/Mac Cable operators surveyed: 5 in 22, 23 and 24. DTH operators surveyed: 4 in 22, 6 in 23 and 9 in 24. IPTV operators surveyed: 4 in 22, 23 and SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved.

12 In terms of content lineup, many of the above pay TV providers have launched linear streaming channels or have increased the number of linear channels available as part of their TVE offerings. All the TV Everywhere operators also provide on-demand video libraries complete with VOD, PPV and catch-up TV content. TVE services from Malaysia s Astro and the Philippines Cignal TV can be accessed by both subscribers and nonsubscribers, but at different costs and with different content lineups. Thailand s TrueVisions only offers TVE to customers with premium subscription packages, and it charges a fee after its free trial expires. Asia Pacific TV Everywhere Summary, as of January 24 While authentication with pay TV accounts remains the most common means for accessing TVE services, usually at no additional cost, operators are also exploring diversified business models with pay options. For instance, Australia DTH incumbent FOXTEL has launched a variety of stand-alone pay TV packages dedicated to the Xbox, Samsung Smart TV and Telstra T-Box platforms as low-cost multichannel subscription alternatives. Connected Device Supporting TVE Service TVE Launch Smart Game PC/ Device Completion # of Live CI Country Operator Platform Date TV Tablet Console Mac Score Channels Plus Australia FOXTEL DTH/Cable Oct-9 yes yes yes yes yes 5 up to 74 channels no South Korea CJ HelloVision Cable May- yes yes yes no yes 4 7+ channels no Japan NTT Plala Inc. IPTV Aug- yes yes yes no yes 4 no no Singapore StarHub Ltd Cable Jun-2 yes yes yes no yes 4 up to 59 channels no Taiwan Vee Telecom Multimedia IPTV Oct-2 no yes yes yes yes 4 N/A no Japan SKY Perfect JSAT Corp. DTH/IPTV Oct- yes yes yes no yes 4 no no Taiwan Chunghwa Telecom IPTV Dec-9 no yes yes no yes 3 N/A no New Zealand SKY Network Television DTH Jan- no yes yes no yes 3 up to channels no South Korea KT Corporation DTH/IPTV Apr- no yes yes no yes 3 6+ channels no Japan J:COM Cable May-2 no yes yes no yes 3 no no Singapore SingTel IPTV Jul-2 yes yes yes no no 3 up to 4 channels no Malaysia Astro DTH Mar-3 no yes yes no yes 3 up to 3 channels no Thailand TrueVisions DTH/Cable May-3 no yes yes no yes 3 up to 2 no China Beijing Gehua Cable Jun- no yes yes no yes 3 up to 46 channels no India Dish TV India Ltd. DTH Oct-3 no yes yes no yes 3 27 channels no India Tata Sky Ltd. DTH Oct-3 no yes yes no no 2 54 channels no Philippines Cignal TV DTH Jul-3 no yes yes no no 2 4 channels no Hong Kong i-cable Communications Cable Feb-2 no yes no no no 6 channels no Total Platform penetration of devices and services 33% % 94% % 24 SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 2

13 % % 83% % 67% 65% 7 6 Latin America Penetration of Multi-Screen Devices, Apps, and Features Among TV Everywhere Systems in Latin America (%) Penetration Rate No. of TVE Platforms Mac PC ios Android ios During 23 and the first two months of 24, TVE activity in Latin America (LatAm) intensified, with seven operators launching their own TVE systems, adding to the four operators that had launched similar ventures prior to 23, to bring the number to. Until then, TVE deployments were spearheaded by programmers, which had released 3 initiatives through the end of 22 (of which were from U.S.- based programmers and three from Globosat Programadora LTDA, for the Brazilian market). Still, Globosat added three more platforms to its line-up during 23 to bring its total to six. To calculate the multiscreen accessibility completion rate, SNL Kagan takes into account the most important supported devices, apps and features for TVE accessibility currently in the market. This list comprises: PCs; Macs; iphones, Android smartphones, and their respective apps; Smart TVs from LG, Samsung, Panasonic and Philips; Xbox 36/One; and functionality for smartphone/tablet remote control (ipad/ipod and Android tablets, and their respective apps). Each of the 6 listed aspects of multiscreen penetration is given one point, with points added up to a final completion rate. 7% 7% 7% 4% 3% 3% Android LG Samsung Panasonic Philips Xbox 36/One / Tablet Rem. Cont. -Computers- -Mobile Devices- -Mobile Apps Smart TVs----- As of March SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. -Game Consoles The increased dynamism of TVE in LatAm in 23 is also evident with regard to multiscreen accessibility. Several TVE entities released new Apple Inc. ios and Google Inc. Android apps (either to enhance the mobile user experience or to afford it to users in the first place) and extended multiscreen access to Smart TVs and Microsoft Corp. s Xbox 36/One. The Moviecity Play platform has offered smartphone/tablet remote control functionality with Moviecity Connect since July 23. The resulting standings for penetration of supported devices, apps and features in 23 are shown in the chart at left, along with stats for number of platforms penetrated. Please note that each pan-regional operator, such as DIRECTV Panamericana, is counted only once for the purpose of this report s LatAm analysis. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 3

14 Prior to the proliferation of operator-managed TVE platforms, live content came almost exclusively from ESPN Play, but operators DIRECTV Panamericana, Nuevo Siglo (Uruguay), SKY Brasil, UNE EPM Telecomunicaciones (Colombia), Cable Onda S.A. (Panama), Montecable (Uruguay) and Sky Mexico now offer live streaming through their TVE portals, with diverse programming. Some operators have launched hybrid TVE models giving authenticated free multidevice access to content to eligible pay TV subscribers, with optional add-on SVOD offerings and/or TVOD titles. Sky Brasil, TCC Vivo, Megacable SA (Mexico) and Televisa subsidiaries Sky Mexico, Cablevision Mexico, Cablevisión Monterrey (TVI) and Cablemás (these last four through over-the-top service Veo TV) now feature pay TVE options. TVE in the region was introduced by ESPN with its platforms Watch ESPN (for Brazil) and ESPN Play (for the rest of LatAm) in August 27 and May 2, respectively, initially as free offerings for broadband subscribers of selected ISPs. In March 2, Argentina s Cablevision S A became one of the first operators in the region with a TVE entity when it started providing authenticated ESPN Play access to its pay TV subscribers as well. Such partnerships between U.S. programmers and operators have largely characterized TVE activity in LatAm, but in November 2, Liberty Global plc-owned VTR GlobalCom S.A. (Chile) launched its own GO VTR service exclusively for its cable subscribers. Other operators have followed suit with their own TVE platforms since then. The popularization of free, ad-based OTT services like Argentina s Cuevana and Netflix Inc. s incursion in LatAm in September 2 (with the expectation leading up to it) precipitated the launch of several TVE entities developed by both programmers and, to a lesser degree, operators. In Brazil, pay TV programmer Globosat (the largest in LatAm in terms of audience) introduced Muu as a free service to NET TV subscribers in August 2 and has since extended the service to four other operators. One year after its launch, the platform recorded more than 4 million registered users. Globosat released platform Telecine Play for Rede Telecine a year later in August 22. Telecine Play is currently the TVE platform distributed among the most operators in Brazil (eight operators), but the platform may have fewer registered users than other platforms, as it is available only for subscribers of premium package Rede Telecine. 24 SNL Kagan, a division of SNL Financial LC. All rights reserved. 4

15 Globosat s remaining TVE catalog includes PremiereFC.com (live Brazilian soccer), Philos TV (documentaries), Receitas GNT (cooking recipes) and +Combate (live mixed martial arts fights). Other programmer-managed TVE entities in the Brazilian market include the aforementioned Watch ESPN (with a hybrid accessibility model that varies by operator) and HBO GO Brasil, currently available only for DTH operator Sky Brasil s subscribers with HBO premium packages. As for the rest of Latin America, ESPN Play and 2st Century Fox Inc.- owned LAPTV s (Latin America Pay Television Service) Moviecity Play entity lead the pack on the content provider side in terms of the number of operators connecting subscribers to the platforms (3 operators in 3 territories for ESPN, edging out Moviecity Play s distribution among 3 operators in territories). Moviecity Play s completion rate (5 out of 6, or 94%) is far higher than that of any other entity. LAPTV is in the process of centralizing its other entities Fox Play and Fox Sports Play (both deployed among 23 operators in nine markets and with a relatively low completion rate of 25%) in Moviecity Play s platform in order to provide a seamless one-stop hub for its TVE content distribution. A+E Networks TNT GO and Space GO, as well as adult content entities HOT GO (Claxson/Playboy) and XTSYNOW (owned by New Frontier Media Inc. and available only via DIRECTV Panamericana) and HBO GO round out the list. TVE Platform Distribution Ranking, Latin America Number of Operators ESPN Play Moviecity Play Fox Play Fox Sports Play HOT GO HBO GO DirecTV Play XTSYNOW Space GO TNT GO Movistar TV GO Telecine Play Muu Watch ESPN PremiereFC.com VEO +Combate Philos TV Receitas GNT Blue To Go VE Cable Onda GO Click&Play GO VTR HBO GO BR Megacable On Demand NS NOW Sky Online TCC Vivo UNE TV As of March SNL Kagan, a division of SNL Financial LC, estimates. All rights reserved. 2 Number of Territories SNL Kagan, a division of SNL Financial LC. All rights reserved. 5