Blu-rayBlu-ray DiscDisc AssociationAssociation CESCES 20072007

Blu-rayBlu-ray Disc:Disc: TheThe LeaderLeader inin HDHD EntertainmentEntertainment AgendaAgenda

•• Key Key FactorsFactors forfor ConsumerConsumer AdoptionAdoption –– Why Why Blu-rayBlu-ray WillWill WinWin

•• The The HollywoodHollywood PerspectivePerspective –– AnnouncementsAnnouncements && CommentsComments fromfrom SevenSeven ofof thethe EightEight MajorMajor StudiosStudios

•Q&A•Q&A 1.1. ContentContent AdvantageAdvantage Blu-rayBlu-ray DiscDisc ContentContent AvailabilityAvailability

Blu-rayBlu-ray NowNow LeadsLeads inin TitlesTitles AvailableAvailable toto ConsumersConsumers

USUS TitlesTitles asas ofof 1/8/071/8/07

200200 180180 160160 140140 120120 100100 8080 6060 4040 2020 00 JunJun Jul Jul Aug Aug Sep Sep Oct Oct Nov Nov Dec Dec Jan Jan

Source: Available to Buy on Amazon.com as of 1-8-07 ContentContent SupportSupport

•• The The mostmost importantimportant factorfactor forfor OnlyOnly onon consumersconsumers Blu-rayBlu-ray DiscDisc •• Seven Seven ofof eighteight majormajor HollywoodHollywood studiosstudios supportsupport BDBD •• Five Five areare exclusiveexclusive toto Blu-rayBlu-ray •• You You cannotcannot watchwatch filmsfilms fromfrom thesethese fivefive studiosstudios onon HDHD DVDDVD •• More More contentcontent meansmeans moremore consumersconsumers cancan bebe attractedattracted toto BDBD •• More More importantimportant thanthan anyany otherother factorfactor forfor aa format’sformat’s successsuccess ImpactImpact ofof 77 ofof 88 StudiosStudios

TheThe TopTop SellingSelling 2020 DVDDVD TitlesTitles inin 2006:2006:

1. Pirates of the Caribbean: Dead 11. Chicken Little Man's Chest 12. Click 2. The Chronicles of Narnia 13. X-Men: The Last Stand 3. Cars 14. Talladega Nights: The Ballad of 4. Harry Potter & the Goblet of Fire Ricky Bobby 5. Wedding Crashers 15. Flightplan 6. Walk the Line 16. Returns 7. King Kong 17. The Devil Wears Prada 8. Over the Hedge 18. 9. The Da Vinci Code 19. Bambi II 10. Ice Age: The Meltdown 20. Grey's Anatomy - Season 2

Illustrates current HD format alignment of releasing studio

DVD sales source: Daily Variety 1/5/2007 HighHigh DefinitionDefinition TitleTitle Demand:Demand: USAUSA

(Title Shipments in Millions)

800 684

700

600 403 500 BD

400 HD DVD 190 300

200 59

100

0 2007 2008 2009 2010 HD DVD 16 43 61 56 BD 43 147 342 628

Source: Understanding & Solutions, Ltd. 9/06 2.2. HardwareHardware AdvantageAdvantage Q4Q4 2006:2006: AA BigBig OneOne forfor BDBD Players…Players…

Philips BDP9000

Sony BDP-S1

Samsung BD-P1000 (June ‘06) Panasonic DMP-BD10 Sony PlayStation 3

Pioneer Elite BDP-HD1

Q2 Q3 Q4 Q4Q4 2006:2006: AA BiggerBigger OneOne inin Japan…Japan…

Market Research indicates that by the end of Q4, 2006 Blu-ray has captured 96% of the high definition player market in Japan

Source: GFK, 12/06 TechnologyTechnology FromFrom LeadingLeading Brands…Brands…

•• Every Every majormajor CECE companycompany inin thethe BDABDA isis alsoalso aa majormajor providerprovider ofof HDTVHDTV displays…displays…

TheThe leadersleaders inin HDTVHDTV technologytechnology areare alsoalso leadersleaders inin Blu-rayBlu-ray DiscDisc BDBD HardwareHardware AvailableAvailable TodayToday HighHigh DefinitionDefinition VideoVideo PlayerPlayer DemandDemand Forecast:Forecast: USAUSA Million Units

20 16.50

15 BD

HD DVD 10 8.47

4.75 5 2.00

0 2007 2008 2009 2010 HD DVD 0.85 1.40 0.67 Neg Blu-Ray 1.15 3.35 7.80 16.50

Source: Understanding & Solutions, Ltd. 9/06 3.3. TheThe PlayStationPlayStation 33 AdvantageAdvantage PlayStationPlayStation && MoviesMovies

•• Sony Sony hashas shippedshipped 1,000,0001,000,000 PS3’sPS3’s asas ofof Dec.Dec. 31,31, 20062006

•• A A newnew surveysurvey ofof 10,000+10,000+ PS3PS3 ownersowners revealedrevealed that:that:

–– 80% 80%of of thethe respondentsrespondents planplan toto purchpurchasease Blu-rayBlu-ray moviesmovies toto viewview onon theirtheir PS3PS3

–Over– Over 75%75%of of respondentsrespondents planplan toto useuse theirtheir PS3PS3 asas aa primaryprimary devicedevice forfor watchingwatching moviesmovies

80%80% ofof 1,000,0001,000,000 equalsequals anan instinstalledalled basebase ofof 800,000800,000 Blu-rayBlu-ray playersplayers hungryhungry forfor highhigh definitiondefinition motionmotion picturepicture contentcontent

Source: Sony Corp. HDHD CapableCapable GamesGames ConsoleConsole SalesSales :: USAUSA

Million Units

15

9.95 10.00

10 8.70

5.76 PS3 X-Box Drive 5

0 2007 2008 2009 2010 X-Box 360 (Add-on drives) 0.76 0.75 0.50 0.20 PS3 5.00 9.20 9.50 8.50

Source: Understanding & Solutions, Ltd. 9/06 4.4. PuttingPutting ItIt AllAll TogetherTogether Blu-rayBlu-ray DiscDisc == MassiveMassive SupportSupport

Movies MusicGames Consumer Electronics Computing TheThe BottomBottom Line…Line…

•• Blu-ray Blu-ray DiscDisc resonatesresonates withwith consumersconsumers wherewhere itit mattersmatters most:most:

99 TheThe largestlargest varietyvariety ofof titlestitles (movies,(movies, music,music, games)games)

99 TheThe widestwidest varietyvariety ofof hardwarehardware productsproducts

99 TheThe onlyonly HDHD gaminggaming consoleconsole withwith built-inbuilt-in HDHD moviemovie playbackplayback

99 Write-onceWrite-once && rewritablerewritable recordingrecording formatsformats fromfrom dayday oneone

99 CompatibilityCompatibility withwith DVDDVD

•• Consumers Consumers havehave thethe finalfinal wordword –– and and thethe wordword isis Blu-rayBlu-ray MikeMike DunnDunn PresidentPresident 2020thth CenturyCentury FoxFox WorldwideWorldwide HomeHome EntertainmentEntertainment WeeklyWeekly SalesSales RateRate ofof BDBD MoviesMovies toto MoreMore thanthan TripleTriple HDHD DVDDVD byby EndEnd ofof FirstFirst QuarterQuarter 20072007

350,000 BD Sales 3.5:1

300,000 BD Sales 3:1 250,000 Blu-ray Weekly BD Sales 2:1 200,000 passes HD DVD by 21% 150,000 100,000

50,000

0

0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 0 /6 3 0 7 /4 1 8 5 /1 /8 5 2 9 /5 2 9 6 /5 2 9 6 /2 /3 1 /1 /2 /2 2 /1 /1 /2 1 1 /1 /2 /2 2 /1 /1 /2 3 /1 /1 /2 4 0 1 1 1 1 1 2 2 2 1 1 1 2 2 2 3 3 3 1 1 1 1 1 1 1

Blu-ray Units HD-DVD Units Source: Fox Home Entertainment SteveSteve BeeksBeeks PresidentPresident LionsgateLionsgate WorldwideWorldwide HomeHome EntertainmentEntertainment QuickTime™ and a QuickTime™ and a None decompressor None decompressor are needed to see this picture. are needed to see this picture.

t KelleyKelley AveryAvery PresidentPresident ParamountParamount WorldwideWorldwide HomeHome EntertainmentEntertainment DavidDavid BishopBishop PresidentPresident SonySony PicturesPictures WorldwideWorldwide HomeHome EntertainmentEntertainment Blu-rayBlu-ray Benchmarks Benchmarks

•• 700%700% increaseincrease inin softwaresoftware salessales sincesince mid-Nov.mid-Nov. withwith thethe launchlaunch ofof PlayStationPlayStation 33 andand additionaladditional Blu-rayBlu-ray CECE && ITIT HardwareHardware

•• Blu-rayBlu-ray weeklyweekly softwaresoftware salessales hhaveave nownow surpassedsurpassed weeklyweekly HD-DVDHD-DVD salessales

•• 82%82% ofof surveysurvey respondentsrespondents areare moremore interestedinterested inin purchasingpurchasing Blu-rayBlu-ray moviesmovies afterafter watchingwatching bundledbundled TallTalladegaadega NightsNights onon theirtheir PlayStationPlayStation 33

•• SPHESPHE targetingtargeting 90-10090-100 titlestitles forfor 20072007

•• SPHESPHE TopTop 55 SellingSelling TitlesTitles toto DateDate inin Order:Order: UnderworldUnderworld Evolution,Evolution, TalladegaTalladega Nights,Nights, FifthFifth Element,Element, Click,Click, UltravioletUltraviolet ComingComing SoonSoon toto Blu-rayBlu-ray fromfrom SPHESPHE

•• 11stst QtrQtr NewNew ReleaseRelease HighlightsHighlights:: CasinoCasino Royale,Royale, MarchMarch 1313 (AVC(AVC Encoded)*Encoded)* GridironGridiron Gang,Gang, JanJan 16*16* OpenOpen Season,Season, JanJan 3030 (AVC(AVC Encoded)Encoded) RunningRunning WithWith Scissors,Scissors, FebFeb 6*6* StrangerStranger ThanThan Fiction,Fiction, FebFeb 27*27*

•• …and…and ComingComing SoonSoon:: TheThe HolidayHoliday RockyRocky BalboaBalboa PursuitPursuit ofof HappynessHappyness CurseCurse ofof thethe GoldenGolden FlowerFlower GhostGhost RiderRider *indicates*indicates BD50BD50 RonRon SandersSanders PresidentPresident WarnerWarner Bros.Bros. WorldwideWorldwide HomeHome EntertainmentEntertainment BobBob ChapekChapek PresidentPresident BuenaBuena VistaVista WorldwideWorldwide HomeHome EntertainmentEntertainment