Half Results Sanford C. Bernstein Fourth Annual Strategic Decisions Conference 2007
London, 26th September 2007 | 1 | Entertaiment Industry | What has changed
Technological Innovation is changing consolidated entertainments models
Increase in the personalisation of the different forms of entertainments
Increase in demand of “premium” content
Audience is increasingly spreading across a multitude of different channels, internet site and free press and distribution platform such as mobile phones and even video games.
“Long Tail Effect” of the modern entertainment
| 2 | Traditional Broadcaster | Macro Strategic Options
1. Pure “Content provider” and “Content packager” focus on the product low level of vertical integration platform agnostic
2. “All-round” Media Company Shift from product to client/viewer vertical integrated “Access” management
| 3 | Mediaset | Inclination towards Media Company
Entrepreneurial approach
First to understand importance of developing its business model on an international scale
Control of the broadcasting infrastructure
First among FTA Broadcaster to get into the Pay-TV market
Recent acquisition on the Content side (Endemol, Medusa)
Natural inclination towards Media Company
| 4 | Entertaiment Industry | The “Long Tail” Effect
Impacts on the audience market
Audience +
Generalistic Theme - Content Content Niche Content
Mass Market Fragmented “Long Tail“ Audience Audience Audience
Concentration Fragmentation
| 5 | Entertaiment Industry | The Audience Market Two main business models have proven to co-exist
Mainly Advertising Audience (Analog/digital)
Mainly Pay-TV(digital)
Generalistic Theme Content Content Niche Content
Mass Market Fragmented “Long Tail” Audience Audience Audience
Concentration Fragmentation
| 6 | Entertaiment Industry | Mediaset’s strategic approach
Audience FTA TV: C5, I1, R4 (Mediaset Core Business)
Multichannel: Boing, others to come
Pay TV: Football, Movies, Series, others
Niche: Home Shopping, Internet, Mobile, PCTV, VOD, User Generated Content Generalistic Theme Content Content Niche Content
Mass Market Fragmented “Long Tail” Audience Audience Audience
Concentration Fragmentation
| 7 | FREE TO AIR
MULTICHANNEL
PAY TV
NICHE
CONCLUSIONS
| 8 | Mediaset’s Approach |FreetoAir Television
24 hours Audience Share: Figures include analog, satellite (incl. SKY Italia homes) and DTT platforms 1H 2006 1H 2007
43.9% 41.6% INDIVIDUALS
40.7% 41.1%
40.1% 37.4% COMMERCIAL TARGET (15-64 Years) 43.0% 43.6%
Source: Auditel excl. SanRemo
| 9 | Mediaset’s Approach | Free to Air Television
Prime Time Audience Share (20:30 - 22:30) Figures include analog, satellite (incl. SKY Italia homes) and DTT platforms 1H 2006 1H 2007
45.4% 43.7% INDIVIDUALS
40.9% 41.2%
42.6% 40.9% COMMERCIAL TARGET (15-64 Years) 43.0% 43.4%
Source: Auditel excl. SanRemo
| 10 | Mediaset’s Approach | Free to Air Television
Sky Italia – Audience Share: April – June, 24 hours Individuals Audience Share (%)
Sky Channels 2,6 1 channel audience > 0,5 Fox Channels 0,7 16 channels audience 0,1 – 0,5 RAI SAT 0,2 58 channels audience < 0,1 Discovery Channels 0,2
SitCom Channels 0,1
Other FTA Satellite 5,6
TOTAL SATELLITE 9,4
Source: Auditel
| 11 | FREE TO AIR
MULTICHANNEL
PAY TV
NICHE
CONCLUSIONS
| 12 | Mediaset’s Approach | Multichannel
Boing Audience: First Kids Channel
Individuals (Dtt) - 24 Hours Kids 4 –14 (Dtt) – 24 Hours
1.9% 9.9%
8.6%
1.1%
September ‘06 September’07 September ‘06 September’07
Source: Auditel
| 13 | Mediaset’s Approach | Multichannel
Boing Audience: First Kids Channel
Individuals - 24 Hours Kids (4 – 14) – 24 Hours
Boing 0.35 Boing 2.53 Disney Channel 0.33 Disney Channel 2.36 Playhouse Disney 0.24 Playhouse Disney 1.42 Disney Channel +1 0.16 Disney Channel +1 1.20 RaiSat Yoyo 0.06 RaiSat Smash 0.42 RaiSat Smash 0.05 RaiSat Yoyo 0.30
Source: Auditel, September’07
| 14 | Mediaset’s Approach | Multichannel
Further implementation of the “family of channels” strategy on DTT, in order to: Take advantage from the ongoing audience fragmentation Satisfy the viewers’ multichannel demand Build a multichannel offer at no incremental cost: new channels will mainly feature re-runs Further exploitation of existing library and production
| 15 | FREE TO AIR
MULTICHANNEL
PAY TV
NICHE
CONCLUSIONS
| 16 | Mediaset’s Approach | Pay TV
Mediaset Premium Pay-TV present offer:
live broadcast of Serie A and FOOTBALL UEFA Champions League matches
the most recent international MOVIES blockbusters
the latest episodes of America’s SERIES most famous Series
24 hours coverage of the currently REALITY SHOWS playing shows
OTHER EVENTS theater plays, concerts
| 17 | Mediaset’s Approach |PayTV
Mediaset Premium smart cards and recharges sale performance*: End of Phase 1 000’s 10.000 9.413 9.188 9.000 8.202 7.933 8.000 6.911 7.000 6.266 6.000 5.380 5.000 4.338 4.000 2.820 2.730 2.918 2.794 3.000 2.628 2.369 2.574 2.998 2.048 2.135 2.000 1.282 1.951 2.092 1.994 1.798 1.922 1.000 1.438 1.561
0 Aug. Dec '05 Feb '06 Apr Jun '06 Aug Oct. Dec '06 Feb '07 Mar Jun '07 July '07 Aug 16/09/2007
SmartCard Sold to retailers Recharges Sold to retailers
| 18 | FREE TO AIR
MULTICHANNEL
PAY TV
NICHE
CONCLUSIONS
| 19 | Mediaset’s Approach |NicheAudience
Home Shopping
Internet based platform
Digital Merchandising (VAS)
Mobile DVB-H / UMTS
Participation TV coming soon
Merchandising
Music
| 20 | Mediaset’s Approach | Home Shopping
Mediaset’s home shopping business:
C5, I1, R4 Production and post Production Facilities Retail Windows Retailing and Marketing Customer Service Delivery and Logistics Direct 24h Channel Over 20 ml tv contacts each day Marketing on Dtt & Over 1.3 ml clients Satellite 60% Revenues from Windows and 24h Channel From Jan. to Sept. 2007: Internet Catalogue and Print - 30.000 average orders per month - 100 euro, average revenue per order
| 21 | Mediaset’s Approach | Internet platform
Through internet platform Mediaset offers:
COMMUNITIES MULTIPLATFORM and VIDEO ON DEMAND NEWS SERVICE USER GENERATED CONTENT
| 22 | Mediaset’s Approach | Internet platform
TGCOM provides real time news through its website and its mobile update service
MULTIPLATFORM NEWS SERVICE
Unique Users: 4.400.000 per month Page Impressions: 147.000.000 per month
Source: Nielsen NetRatings
| 23 | Mediaset’s Approach | Internet platform
COMMUNITIES and SELF GENERATED CONTENT
Unique Users: up to 3.600.000 per month Page Impressions: up to 100.000.000 per month
120 SECONDS 6 COME 6 120 SECONDS 6 COME 6 Wanna-be reporters can Viewers can shoot their own share and publish their work Italia 1 channel promotional on this section of the TGCom video. The best works will be website broadcast on FTA
LE IENE TALENT 1 LE IENE TALENT 1 On the website of one of Singers, dancers and young Mediaset most popular tv film directors can promote shows people can share themselves by sharing their funny videos and candid perfomance samples on the cameras web
Source: Nielsen NetRatings
| 24 | Mediaset’s Approach | Internet
The best content from all Mediaset platforms is also available on demand through its PC – Television service
VIDEO ON DEMAND
Unique Users: 45 million videos watched up to 1.200.000 per month and 350.000 new unique users since launch in April 2007
DOWNLOAD AND STREAMING WITH PLAY ADVERTISING
Content available for download Content can be viewed upon payment (e.g. TV Series: EUR on line with advertising 1.99 per episode) windows
Source: Nielsen NetRatings
| 25 | Mediaset’s Approach | Internet
Video on demand: current content offer
Italian Fiction Carabinieri, Distretto Italian Fiction di Polizia,…
AmericanAmerican TV TV The Closer, The OC, SeriesSeries Smalville, Nip/Tuck
The Serie A league LiveLive Football Football Matches 3 most exciting Matches matches of the day
National and MoviesMovies international blokbuster movies
Entertainment Re-runs of Mediaset’s Entertainment shows best entertainment shows programming
| 26 | Mediaset’s Approach | Mobile Big Brother: more than 80.000 videos downloaded during the last edition
One integrated offer of textual and audiovisual content: ACCESS developed as a wap-based mobile site delivered via the Mobile Operators portals under one umbrella brand Mediaset.itTV services: program guide, in- depth information, programming CONTENTS Videos from the best TV shows: Grande Fratello, Amici, Scherzi a Parte.. Videonews: Tg5, Tgcom, Studio Aperto…
| 27 | Mediaset’s Approach | Mobile (DVB-H)
Transmission Content Network
- 3 Commercial Channels - “Series A” Championship - Champions League
- 3 Commercial Channels - “Series A” Championship - Boing (kids channel)
| 28 | FREE TO AIR
MULTICHANNEL
PAY TV
NICHE
CONCLUSIONS
| 29 | Conclusions | Mediaset’s Strategic Priority
Focus on “Core Business” Enhance the value of specific target audience and emphasize the uniqueness of commercial TV target Consolidate the present programming cost discipline Increase exploitation of our brand and content Enhancing Multichannel strategy (FTA) Increasing “premium” content (PPV) Enlarge DTT platform
Test valuable business model in the “niche CONTENT audience” area (independently from the platform) Opportunistic approach in M&A GEOGRAPHY
ACCESS
| 30 | Half Results Sanford C. Bernstein Fourth Annual Strategic Decisions Conference 2007
London, 26th September 2007 | 31 | Investor Relations Department:
Tel: +39 02 2514.7008 Fax: +39 02 2514.6719 Email: [email protected] WebSite: www.gruppomediaset.it/investor/
Forward-looking Statements Statements contained in this document, particularly the ones regarding any Mediaset Group possible or assumed future performance, are or may be forward looking statements and in this respect they involve some risks and uncertainties. Mediaset Group actual results and developments may differ materially from the ones expressed or implied by the above statements depending on a variety of factors. Any reference to past performance of Mediaset Group shall not be taken as an indication of future performance. This announcement does not constitute an offer to sell or the solicitation of an offer to buy the securities discussed herein.
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