1. CONVERGED TV
How it will affect
viewership habits?
POLICY RECOMMENDATION

2. This is Consumerlab
1 000,000
RESPONDENTS
SINCE 1995
REPRESENTING
100,000
RESPONDENTS
1.1 billion
PEOPLE
PER ANNUM
MORE THAN
70 15 MEGACITIES
COUNTRIES STUDIED
Connected TV Page 2
2012-06-27 | Conference | © Ericsson AB 2012 | 2012-10-17 | Page 2 (19)

3. Consumerlab TV-VIDEO
studies
Source: Ericsson ConsumerLab TV Video Consumer trends 2012, Urban sample in China, Brazil, Chile & Mexico, National sample all other markets, Ipsos statistics, CIA the world factbook
Connected TV Conference | © Ericsson AB 2012 | 2012-10-17 | Page 3 (19)

4. Consumer expectations
One super simple, convenient, aggregated service
bringing “my” content into one experience
On-demand
content
Individualized
TV experience
Idea based
Social TV
content discovery
Linear bundles &
A’ la Carte
Source: Ericsson ConsumerLab TV Video Consumer trends 2012
Connected TV Conference | © Ericsson AB 2012 | 2012-10-17 | Page 4 (19)

5. Change:
On-demand going mainstream
Advanced services, features and habits are
becoming available for everybody
“The shortcut”
Basic broadcast Connected-TV Merging the
viewing TV-experience
• TV-screen based
Enabled by easy to use • Mix of linear and
built in features on-demand
• Multi screen based
Requires knowledge, Requiring even more
exploration, time & technology knowledge, time & techy devices
Internet based on-
demand
• PC-screen based
Source: Ericsson ConsumerLab TV Video Consumer trends 2012
Connected TV Conference | © Ericsson AB 2012 | 2012-10-17 | Page 5 (19)

6. CHANGE:
Growing habit of paying for on-demand
%
BASE: Core 7 markets (US, UK, Sweden, Germany, Spain, China and Taiwan) [Have and use device and Watch stream or download video at least monthly]
Source: Ericsson ConsumerLab TV Video Consumer trends 2011, 2012
Connected TV Conference | © Ericsson AB 2012 | 2012-10-17 | Page 6 (19)

7. CHANGE: Displacing “free” can be done
with lawful services !
Spain
Base: Spanish on-demand (streaming & downloading content) users (513 users out of 1000)
New & old content Attractive pricing User friendly & simple
60%
US
50% 2011
40% 2012
30%
20%
10%
0%
Other File sharing Apple iTunes Amazon Instant Operator On- TV Network Hulu Netflix
Video demand homepage
Base: US on-demand (streaming & downloading content) users (591 users out of 1000)
BASE: Spain & US [On-demand users that watch streamed or downloaded video content at least several times per month]
Source: Ericsson ConsumerLab TV Video Consumer trends 2011 & 2012
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8. What do consumers value ?
On-demand & Time shift (+8%-points)
Theatretical releases direct on TV
A la Carte TV/Video content (+7%-points)
A lot of TV Channels
BASE: Core 7 markets (US, UK, Sweden, Germany, Spain, China and Taiwan) (Showing those who consider the service worth paying for)
%
Source: Ericsson ConsumerLab TV Video Consumer trends 2011, 2012
Connected TV Conference | © Ericsson AB 2012 | 2012-10-17 | Page 8 (19)

9. Barriers for On-demand TV
and Video usage
Source: Ericsson ConsumerLab TV Video Consumer trends 2012
Connected TV Conference | © Ericsson AB 2012 | 2012-10-17 | Page 9 (19)

10. The market supply failure of
lawful “on-demand” content
Source PWC Global Entertainment Outlook 2012
Connected TV Conference | © Ericsson AB 2012 | 2012-10-17 | Page 10 (19)

11. POLICY
RECOMMENDATIONS
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12. INCREASE AVAILABILITY OF LAWFUL DIGITAL SERVICES
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13. FIRST RELEASE WINDOW MUST TOO GO DIGITAL
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14. DISPLACE FREE WITH LEGAL DIGITAL SERVICES
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15. REASONABLE
CONSUMER
EXPECTATIONS
EXCEPTIONS
TIME
PLACE
DEVICE
SHIFTING
MUST BE
MET
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16. TECHNOLOGY NEUTRAL EXCEPTIONS
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17. PROMOTE INNOVATION
MORE
FLEXIBILITY &
INSTANT GRATIFICATION
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18. Summary
› Windowing, first release window must go digital – lawful digital
alternatives necessary.
› Displace illegal access with appropriate lawful digital services – more
enforcement not a solution for treating the absence of lawful digital
availability.
› Time-, Place-, Device-shifting exceptions must be
accommodated, reasonable expectations.
› Technology neutral exceptions > private cloud
› Roaming private services a step to multi-territorial services
› Promote A’ la Carte innovation, traditional services must offer more
flexibility and accommodate instant gratification; Micro-payments, Pre-
paid, Vouchers/Tickets, Viral marketing/Social TV to complement
subscriptions and advertising models.
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