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Quantifying the Content Rollercoaster of 2020

Macro Viewership Trends Across the VODs (AVOD, SVOD & TVOD)

September 2020

Copyright 2020. The NPD Group, Inc. All Rights Reserved. This presentation is proprietary and confidential and may not be disclosed in any manner, in whole or in part, to any third party without the express written consent of NPD. Quantifying the Content Rollercoaster of 2020

Capturing Fostering sign-up & (and retaining) The Great Re-Bundling maximize engagement viewer attention

A desire for home Content remains king The most common entertainment is driving and must deliver value bundles include , viewership gains and Amazon, & Disney+ accelerating the migration to streaming AVOD & TVOD supplement it

The NPD Group, Inc. | Proprietary and confidential The NPD Group, Inc. | Proprietary and confidential TV Became Essential During COVID-19

The NPD Group, Inc. | Proprietary and confidential TV sales have been up since the start of the pandemic Gaming, streaming/DVD/BD player attachment, home office needs and pulled forward purchasing have been driving sales TV Y/Y Sales

Pre COVID-19

59% 54% 35% 26%

16% Sales Change % Change Sales

Feb Week Week Week Mar Week Week Week Week Apr Week Week Week May Week Week Week June Week Week Week Week July Week Week Week Aug Week Week 2 3 4 Week 2 3 4 5 Week 2 3 4 Week 2 3 4 Week 2 3 4 5 Week 2 3 4 Week 2 1 1 1 1 1 1 1 Unit Growth ASP Growth

Source: NPD Retail Tracking Service

The NPD Group, Inc. | Proprietary and confidential 5 Stay-at-home Orders Accelerated the Migration to Streaming

The NPD Group, Inc. | Proprietary and confidential Streaming players sales have also grown during stay-at-home orders

Streaming Media Player Y/Y Sales

Pre COVID-19

62% 45% 36% 29%

24% Sales Change % Change Sales

Feb Week Week Week Mar Week Week Week Week Apr Week Week Week May Week Week Week June Week Week Week Week July Week Week Week Aug Week Week 2 3 4 Week 2 3 4 5 Week 2 3 4 Week 2 3 4 Week 2 3 4 5 Week 2 3 4 Week 2 1 1 1 1 1 1 1 Unit Growth ASP Growth

Source: NPD Retail Tracking Service, Excludes Fire TV

The NPD Group, Inc. | Proprietary and confidential 7 Content consumption is peaking

The NPD Group, Inc. | Proprietary and confidential Q2 Y/Y growth in , transactional & subscription video was staggering

The ‘20-’21 mission: retain the audience

Digital Video Growth Q2 ’20 vs. Q2 ‘19

61% 57% 50% 42%

26.5m MAUs iVOD +76%

PlutoTV* (AVOD) Electronic-Sell-Through VOD SVOD

Source: DEG *ViacomCBS Earnings Report, domestic monthly active users

The NPD Group, Inc. | Proprietary and confidential 9 Used the Most, Gained the Most

The NPD Group, Inc. | Proprietary and confidential Services used the most frequently are gaining the most ground Netflix, Hulu, Disney+, CBS All Access, and drive the greatest engagement

Most Frequently Used SVOD Services 87% (April 2020) 80% 70% 68% 64%

57% 48% 42% 40% 39%

$15B 2019 content spend

Netflix Hulu (On-Demand) Disney+ CBS All Access Amazon Prime Video

% of subscribers that use at least weekly % Using More Often

Source: TV Switching Study

The NPD Group, Inc. | Proprietary and confidential 11 Disney’s Doing it Right

The NPD Group, Inc. | Proprietary and confidential Disney+ engagement is driven by the right movies being available, exclusive content, affordability, and the lack of ads

Disney+: Top 10 Reasons Subscribed or Using it More (April 2020) TV shows we watch are available 23% Received a free trial 25% Reliable picture quality 26% Easy to search and discover content 26% Ability to watch on TV-connected device 26% Video streaming available 27% Offers content not available another way 30% Affordable 33% No ads 33% Movies we watch are available 43%

Source: TV Switching Study

The NPD Group, Inc. | Proprietary and confidential 13 Content is King

The NPD Group, Inc. | Proprietary and confidential Exclusive content drives engagement for up to 1/3 of SVOD Users

Subscribed or Watch More Because “Content Not Available Another Way” (April 2020) 32% 30% 29% 28%

Source: TV Switching Study Among those who subscribed in the past year or increased engagement

The NPD Group, Inc. | Proprietary and confidential 15 AVOD is a Supplemental Viewing Source The NPD Group, Inc. | Proprietary and confidential Free streaming video is supplemental to subscription services viewers use Nearly all (90%) of viewers age 18-34 use subscription or free streaming service

Subscription & free streaming overlap (April 2020)

7% 17% 3% 13% 4% 30% Neither 4%

44% 5% Free streaming only 35% 38% 24% Both

46% 44% 45% 41% SVOD only

Total 18-34 35-54 55+

Source: The TV Switching Study

The NPD Group, Inc. | Proprietary and confidential 17 Some Do Better

The NPD Group, Inc. | Proprietary and confidential The Channel and Pluto TV generate the highest rate of weekly usage

% of Past Year User Base that Uses Service Weekly (April 2020) 45% 44%

The Roku Pluto TV TV Plus WatchFree Movies LG Channel Free IMDbTV (free Channel ( ( TVs) Streaming & TV (by Xumo) Live TV video) TVs) Live TV

Source: TV Switching Study

The NPD Group, Inc. | Proprietary and confidential 19 The Prowess of Free

The NPD Group, Inc. | Proprietary and confidential All free streaming services have churn risk that is below the norm Top reasons for churn: Too many ads (23%), able to get content another way (22%), other services offer better content (21%) AVOD Services Likely to Stop Using Next 12-Months (April 2020, as a % of users) TV Plus (on Samsung TVs) The Roku Channel Tubi Movies & TV YouTube Plex Streaming Live TV Pluto TV Vudu (free video) Crackle IMDbTV WatchFree (on Vizio TVs) Xumo Redbox Free Live TV LG Channel Plus (powered by Xumo) Norm - All TV Services 8%

0% 5% 10% Source: TV Switching Study Norm includes all 79 TV services measured

The NPD Group, Inc. | Proprietary and confidential 21 The Dream Bundle

The NPD Group, Inc. | Proprietary and confidential The average AVOD/SVOD bundle has 5.8 services YouTube - Roku Channel - Pluto TV – Netflix – Prime – Hulu - Disney+

Avg. # AVOD/SVOD Services April 2020 – Among Each User Group

SVOD Services Used Weekly 5.8 Netflix AVOD Services Used Weekly Prime Video 4.1 Hulu YouTube Disney+ The Roku Channel 2.7 Pluto TV

AVOD AVOD/SVOD SVOD

Source: TV Switching Study * Callouts based on % ranking of weekly active users

The NPD Group, Inc. | Proprietary and confidential 23 Netflix is part of the five most common SVOD bundles Notably, the third most common bundle includes all of the top four SVOD services and it is the MOST common among consumers age 18-34 Most Common SVOD Bundle Among Top 4 Services 14% (% of U.S. Internet HHs that subscribe to each bundle combination, April 2020) 12%

9% 8% 8% 7%

4% 3% 2% 2% 1% 1% 1% 1% 1%

Source: The TV Switching Study

The NPD Group, Inc. | Proprietary and confidential 24 Change is The New Norm

The NPD Group, Inc. | Proprietary and confidential 42% of viewers have intentions to subscribe to or start using a new TV service Fewer, 29% are likely to cancel or stop using a service they currently have

Next 12 Month Likelihood (April 2020)

7% 4% 7% Extremely 11% 18% Very 24% Somewhat

Not too

Not at all

Sign-up to a new service Cancel a service I have Source: TV Switching Study

The NPD Group, Inc. | Proprietary and confidential 26 QUESTIONS?

e [email protected]

p 516-625-4665

The NPD Group, Inc. | Proprietary and confidential 27