Network Operator
Total Page:16
File Type:pdf, Size:1020Kb
US Roadshow Presentation January 2007 | 1 | Mediaset | From FTA TV to Media Company DVB-H Digital (2006) Terrestrial Television Core Business (2004) One of the Largest TV and media company in Europe Leadership in audience shares both in Italy and Spain Leadership in the TV Adv. market both in Italy and Spain Total Net Revenues 2005: 3,678.0 ml Euro Pay per View (2005) | 2 | | 2 | Core Business FTA Television | 3 | Broadcasting | TV Strength in Italy 1997-2005: Total Audience (24 Hours) 9,095 8,848 8,915 9,140 9,284 8,494 8,630 9,213 9,188 8,113 V Consumption (minutes per day) 239 212 T 239 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Source: Auditel (24 hours, average minute) | 4 | | 4| 4|| 4| | Broadcasting | Leadership of FTA TV in Italy % of people per week 2001 2005 ANALOG TV 95.8 93.9 SATELLITE TV 11.9 16.7 RADIO 68.8 63.5 PRESS 60.6 59.1 BOOKS 54.0 55.3 INTERNET 20.1 37.6 WEEKLY - 32.5 MONTHLY - 22.2 MOBILE PHONES 72.8 78.9 Source:” Quinto Rapporto Censis sulla comunicazione in Italia, 2001-2006”, November 2006 | 5 | Broadcasting | Mediaset Leadership on Audience Share (2006, % audience share) 24 Hours Prime Time 44.2 43.3 42.8 43.5 41.3 40.6 39.5 41.5 Individuals Commercial Target Individuals Commercial Target Source Auditel, excluding World Cup. Commercial Target 15-54 years | 6 | | 6 | Advertising Expenditure in Europe Total Ad Spend per Capita Total Ad Spend as % of GDP 2005 (US$) 255 249 0,97 0,95 180 1,02 0,97 0,96 154 151 0,89 0,80 0,80 0,75 0,73 0,74 0,74 0,71 0,73 0,66 0,75 0,62 0,62 0,61 0,61 0,64 0,62 0,63 0,60 0,60 2001 2002 2003 2004 2005 UK Germany France Spain Italy UK Germany Spain France Italy Source Zenith Source Zenith Optimedia April 2006, Global Insight | 7 | | 7 | Advertising | Mediaset vs. ADV Cycle 1997, Index 100 163 159 145 Total 142 Advertising 137 136 147 Market 143 124 136 136 131 134 111 122 100 111 100 1997 1998 1999 2000 2001 2002 2003 2004 2005 Source: Publitalia elaboration on Nielsen AdEx data | 8 | | 8| |8 | Financials | Mediaset Leading Indicators Net Revenues (ml Euro) Operating Profit (ml Euro) CAGR (1997-2005): 9.9% CAGR (1997-2005): 12.8% 3,678 1,201 1,734 46.9459.2 45.8 1997 2005 1997 2005 Net Profit (ml Euro) Dividend per share (Euro) CAGR (1997-2005): 12.3% CAGR (1997-2005): 17.3% 0.43 603.4 238.8 0.12 1997 2005 1997 2005 | 9 | 9 | Italian Advertising Market | Potential Structural Growth Ad-spend = 0.96% UK Nominal GDP UK Total Adv. Market Industry Deregulation Privatisation Italian Total Adv. Market Evolution Ad-spend ITA = 0.62% Nominal GDP 2005 2014 | 10 | | 10 | The advent of Digital TV | 11 | TV Platform | Italian Competitive Scenario - 2001 Commercial Theme PPV VOD Operators 2001 Channels Channels Operators Analog TV n.a. n.a. n.a. DTT Satellite Pay IPTV DVB-H | 12 | TV Platform | Italian Competitive Scenario - 2006 Commercial Theme PPV VOD Operators 2006 Channels Channels Operators Analog TV n.a. n.a. n.a. DTT Free/Pay Satellite Pay IPTV Pay DVB-H Pay | 13 | TV Platform | Mediaset Competitive approach 2004 2005 2006 DTT PPV DVB-H Mobile FTA DTH Cable ADSL UMTS | 14 | Mediaset | Business Model Content Provider Network Provider FREE-TO-AIR TELEVISION PAY TV NETWORK OPERATOR Commercial TV Premium Content Access Renting of Spectrum on proprietary 3 generalistic channels funded by through: Digital Terrestrial Transmitting advertising Pay-per-View Network to: (Analog, DVB-T, DVB-H) Pay-per-Time Captive to Mediaset channels Multichannel Pay-per- Category (Analog) Theme Channel funded by (DVB-T, DVB-H) non-captive TV content provider targeted advertising or telesales (DVB-T) (DVB-T, DVB-H) mobile operators (DVB-H) Interactivity Interactive and Enhanced advertising Interactive services (DVB-T, DVB-H) | 15 | | 15| 15 || | Digital Terrestrial overview | 16 | DTT | DTT roadmap in major European countries and the USA ? (1) General agreement on the unfeasibility of completing national switch-off by 2010 (2) Higher than expected DTT development may allow for switch-off in 2008 (3) Re-launch of DTT on a regional base in 2002; national DTT re-launch in 2005 Sources: EPRA / AGCOM – Working Group on DTT (June 2004), DigiTa; Digital TV Group; Booz Allen Hamilton analysis | 17 | | 17 | DTT Development in Italy | “State of the Art” 6 national network operators (10 Mux) Over 80 local TV broadcasters 15 free content providers (28 channels) 2 providers of Pay Services + a number of local TV operators 14 interactive channels and over 100 interactive services “on air” in the last 2 years 2 mobile TV networks (DVB-H) on air (open to all telecom and mobile content providers) Sources: DGTVi; FUB; Booz Allen Hamilton analysis | 18 | | 18 | DTT Development in Italy | Coverage Transmission Number of DTT Population Technology Operator multiplexes Coverage 2 mux 80% - ≃ 65% 2 mux >70% DVB-T 2 mux ≃ 70% - ≃ 65% 1 mux ≃ 68% 1 mux ≃ 47% 1 mux n.a. DVB-H 1 mux n.a. Source: DGTVi, Corporate website - Local TV MUXs are not included | 19 | | 19 | DTT widened multichannel offering up to 30 channels 30 free-to-air national channels + PPV services MainMain analogueanalogue channelschannels inin simulcastsimulcast ++ interactivityinteractivity SportSport andand sportsport newsnews i i i i i SPORT SOLOCALCIO i i i News:News: financial,financial, international,…international,… KidsKids ShoppingShopping MusicMusic channelschannels i i i i i CultureCulture andand InformationInformation 1111 PayPay perper ViewView servicesservices i i i i i i ii withwith interactivityinteractivity Channels in simulcast New free DTT channels New pay DTT services Note: “Camera” and “Senato” channels are included because their current coverage is below 50% Sources: DGTVi; Sat-Net; Booz Allen Hamilton analysis | 20 | DTT Development in Italy | Set-Top-Box Penetration DTT STB penetration 4,500 4,200 3,800 3,600 2,100 95% are Interactive STB’s 1,250 340 0 jan 04 jul 04 jan 04 june 05 jan 06 mar-06 sept-06 dec 06 Driver for DTT success STBs Price History 390 Subsidy Content offering Net Price Premium contents (pay per view) € 150 Retail Price (gross of Sudsidy) Free channels 250 199 Interactive services 179 € 150 149 119 Accessibility € 150 € 150 99 Plug and Play installation € 70 69 49 “Affordable” pay offering € 239 € 99 € 49 € 29 € 149 € 49 € 99 € 69 € 49 jan 04 mar-04 may 04 sep 04 dec 04 apr-04 nov-05 apr-05 today Source: GfK Marketing Services Italia | 21 | | 21| 21 || | Pay-Per-View | 22 | Pay-Per-View | First Pre-paid card Offer on TV BENEFITS FOR VIEWERS BENEFITS FOR MEDIASET No dish required Focused Investments No Subscription Defensive Move “Pay for what you watch” Driver for DTT Penetration Clear and simple technology Additional Revenues Credit recharged on the Card Credit used watching Mediaset Premium Content 4 1 Credit sent OTA Credit Purchased (on- (Over the Air) to the STB 3 2 line / off line) | 23 | | 23| 23 || | Pay-Per-View | “Mediaset Premium” content offer Football Theatre and Concerts Movies Reality Games Fiction | 24 | | 24 | Pay-Per-View | SmartCard Development 5.380.000 5.500.000 4.882.000 5.000.000 4.500.000 4.338.000 4.000.000 3.780.000 3.500.000 2.820.000 3.000.000 2.574.000 2.729.000 2.628.000 2.470.000 2.500.000 2.428.000 2.306.000 2.369.000 2.092.000 2.048.000 1.951.000 1.908.000 1.922.000 2.000.000 1.403.000 1.798.000 1.500.000 1.232.000 1.438.000 981.000 1.282.000 1.000.000 1.050.000 698.000 500.000 254.020 471.000 0 jul-'05 aug-'05 sept-'05 nov-'06 dec-'05 feb-'06 mar-'06 apr-'06 jun-'06 aug-'06 sept-'06 oct-'06 nov-06 dic-06 | 25 | | 25| 25|25 25|| ||| | | Network operator | 26 | Network operator | DVB-T and DVB-H Digital Terrestrial Network DVB-T DVB-H Digital Terrestrial Set-Top-Box Mobile Handset, PDA, Portable TV Open Platform Open Platform Limited Broadcasting Capacity Tv content can be broadcast in original format Ideal for FTA Broadcasting and DVD quality Channel multiplication Low power consumption for handset 2 MUX. already hosting 3rd party channels Needs only a small antenna 4 – 6 Mbps per channel 200 – 500 kbps per channel 4 – 6 channels per Multiplex 20 – 25 channels per Multiplex | 27 | | 27 | DVB-H | Mediaset Agreements with Mobile Operators Transmission Content Network - 3 Commercial Channels -“SeriesA”Championship - Champions League - 3 Commercial Channels -“SeriesA”Championship - Boing (kids channel) | 28 | | 28 | Future Developments | 29 | Mediaset | 4 DTT Innovation Areas Pay TV Innovation on FTA TV Innovation: enhanced commercial TV, DTT: Pre paid card, new free channels, Proprietary Conditional access new digital contents new advertising models Business Model Technology Innovation Innovation: using open DVB no subscriptions and PPV, standards: Content Acquisition, DVB-T, MHP, DVB-H DVB-H agreement with mobile operators | 30 | | 30| 30 || | Mediaset Group | Possible Future Developments Unique position in Italian and Spanish advertising market Content Strong TV franchise In-house production and creativity of mass audience content Control on key content rights (football) Transmission network ownership Leader and first mover in the platform Geography technological development (DTT-DVB-H) Strong track record and execution Strong financial capability Access | 31 | | 31| 31 || | Back up Slides | 32 | Mediaset Group | Track Record 1999 2000 2001 2002 2003 2004 2005 Ebit Margin (ROS)* (%) 27.3% 29.3% 25.0% 24.1% 26.8% 30.3% 30.2% Net Profit (Euro ml.) 339.2 423.5 248.4 362.0 369.7 549.6 603.4 Free Cash Flow** (Euro ml.) 370.5 255.0 123.9 219.8 282.9 466.9 199.6 Earnings per Share (Euro) 0.29 0.36 0.21 0.31 0.31 0.47 0.51