The document summarizes key points from a presentation on connected TV and online video strategies. It discusses the challenges facing traditional TV companies from new competitors and changing consumption patterns. TV companies need to adapt by developing IP and OTT video strategies, focusing on devices and flexibility across platforms, offering compelling content at reasonable prices, breaking down silos through convergence, and partnering to ensure bandwidth availability. KIT digital is presented as a leader in providing strategic consulting and IP video delivery solutions to help companies address these challenges.

1. Connected TV Summit ‐ Moscow
06 March 2012
Stuart Sanders | Director Sales
Company Online Video Presentation Name August 2011 www.kitd.com ©KIT digital All Rights Reserved

2. A next generation strategy for TV
Companies trying to cope in the
digital age …

3. World leader in next generation IP based video
KIT digital are the world’s leading provider of IP based video delivery Software and Solutions
• Broadcasters
• Pay TV Operators
• Cable
• Satellite
• IPTV
• New Online Entrants

5. Out of your control …
Competition
In your control … Devices
Monetisation
Cost Control
Piracy
Technology &
Infrastructure
Changing Consumption Patterns

6. Competition
KIT Factoid
5%
The percent reduction in overall cable
subscriptions in the US over the last year. Hulu
and Netflix were the fastest growing TV
subscription services in the US in 2011.
Source: comScore
• De‐regulation ... regional boundaries are coming down
• New Entrants … TV business is attracting lots of new entrants … some of them giants
• Piracy … its getting easier and easier to get premium content illegally
• Cord Cutting … means companies already losing money to competitors

7. Changing Consumption
Patterns
KIT Factoid
100 Million
The amount of videos watched per day online
in the US … That’s an increase of over 40% on
2011
Source: comScore
• Linear to VOD • Social TV
• Devices • Companion Applications

8. Devices
KIT Factoid
175 Million
The number of connected living room devices
in Western Europe by 2015. TV sets will
account for 41%.
Source: IHS Screen Digest
• Are STB’s still as relevant? Not in additional rooms of the house (multi‐room)
• General explosion in devices, some used as companion …
• The future is very hard to predict

9. Piracy
KIT Factoid
70%
The percentage of 18 – 29 year olds who
admitted to downloading Movies or TV shows
illegally in North America
Source: Huffington Post
• Way too easy to get premium content online for free … its getting easier too
• Usually download over streaming
• Can be viewed easily on main screen now too

10. Monetization &
Cost Control
KIT Factoid
$487M
The size of the online movie market in North
America in 2011. This is expected to more
than double in 2012.
Source: IHS Screen Digest
• The tide is turning … Companies are starting to make money
• Great content at the right price with a great end‐to‐end experience … will make money
• Controlling costs is one of the main barriers

11. Technology &
Infrastructure
KIT Factoid
29.7%
The percentage of peak internet usage in North
America taken up by Netflix … exceeding that
of P2P or BitTorrent for the first time in 2011.
Source: Financial Post
• Availability of bandwidth is probably the single biggest limiting factor
• Content protection and rights enforcement create another large challenge
• Explosion of devices compounds these problems

13. tip no. 1
adapt or die
IF YOU DON’T PROVIDE A SOLUTION SOMEONE ELSE WILL
1. Make the right level of investment
2. OTT is preferred to closed network
3. Focus on your strengths
4. Great user experience is key
5. Content is King
6. Be distinctive

14. tip no. 2
You have to have vod
ALL TV COMPANIES MUST HAVE A WELL DEVELOPED IP STRATEGY
1. OTT VOD is the most cost effective and flexible
2. Its all about flexibility … linear, VOD, catch‐up
3. Connected TV’s will have the largest impact
4. You need a Social TV strategy

15. tip no. 3
Its all about devices
ALL TV COMPANIES MUST HAVE A MARKET FOCUSSED DEVICE
STRATEGY
1. Orientate your device strategy around your particular market
2. Leverage consumer devices instead of rolling out your own
3. Cover as many as possible as soon as possible
4. Don’t build silo’s

16. tip no. 4
Ignore the pirates
TV COMPANIES NEED TO OFFER BEST‐IN‐CLASS CONTENT
PROPOSITIONS AT REASONABLE PRICES
1. Protect your content with DRM, watermarking, Geo‐filtering
etc.
2. Don’t erect proprietary walls – make it simple and make the
experience great
3. Embrace IP to give consumers the content they want
4. Go after the serial infringers

17. tip no. 5
Convergence is key
TV COMPANIES MUST PULL DOWN THE SILO’s AND PUT THE RIGHT
BUILDING BLOCKS IN PLACE
1. Your digital strategy must be joined up to compete with the likes of
Apple and Netflix
2. You need to be able to offer flexibility and consistency across devices
3. The correct building blocks will help you reduce costs through
automation
4. Build the right business model

18. tip no. 6
Find bandwidth partners
AVAILABILITY OF BANDWIDTH IS THE LAST REMAINING BARRIER TO
SUCCESS
1. With the right commitment to spend, the other technical barriers are
manageable
2. The largest ongoing variable cost is related to bandwidth
3. Leverage more than one bandwidth partner in any given market

20. World leader in next generation IP based video
KIT digital are the world’s leading provider of IP based video delivery Software and Solutions
• Strategic consulting services
• User experience
• Device strategy
• Converged IP based video solutions
• Integration with core TV systems
• Social TV
• Platform Operations

21. Just some of our larger customers …
21
KIT Video Platform Overview August 2011 www.kitd.com ©KIT digital All Rights Reserved

22. Thank You