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The 2016 U.S. Cross-Platform Future in Focus leverages several data sources unique to comScore: . The report is based primarily on behavioral measurement from comScore Media Metrix® Multi-Platform, which provides deduplicated reporting of digital audiences across desktop computers, smartphones and tablets, and comScore Mobile Metrix®, which provides deduplicated reporting of mobile web and app audiences across both smartphones and tablets. The report also includes survey-based mobile data from comScore MobiLens®, as well as TV/Cross-Platform behavioral data from the comScore Xmedia™, comScore OnDemand Everywhere® and comScore TV Everywhere™ product lines. Important Definitions: o Electronic Sell-Through (EST): The consumer pays a fee to purchase or perpetually licenses a digital reproduction (i.e., movie or TV show). This licensed reproduction could be in the form of a file downloaded to the consumer’s internet-connected device or local hard drive, or via access to the content in a virtual storage locker or cloud-based service for streaming on demand to the end-user. The major digital retailers here are Amazon, Google Play, iTunes, PlayStation, Xbox, Vudu and others. o Free on Demand (FOD): Operator-based free on demand content, usually offered via broadcast and cable networks for free or with advertising. o Internet Video on Demand (iVOD): The temporary license (i.e., a rental) of a program for a limited and pre-determined viewing period (such as 24 or 48 hours) for on-demand viewing by an end- user. The program may be downloaded and stored locally on the end-user’s device, or accessed online via streaming from digital retailers like Amazon Instant Video, Google Play, iTunes, PlayStation Store, Xbox Video and Vudu. o Over-the-Top Subscription Video on Demand (OTT SVOD): Refers to the delivery of audiovisual content streamed over the internet without the involvement of an internet service provider (ISP) in the control or distribution of the content. The ISP is neither responsible for, nor is able to control, the viewing abilities, copyrights, and/or other redistribution of the content, which arrives from a third party and is delivered to an end-user’s device from online subscription services like Amazon Prime, Hulu Plus and Netflix. o Mobile: The combination of smartphone and tablet. When data is referring specifically smartphones or tablets, it will be labeled accordingly. o Subscription Video on Demand (SVOD): For a fixed, recurring fee, subscribers may have unlimited streaming to a licensed catalog of content for the duration of their active subscription term. Subscription terms may be as short as one month (e.g., Hulu Plus, Netflix) or as long as one year (e.g., Amazon Prime). In addition to SVOD via over-the top (OTT), SVOD can also be delivered via Cable Video on Demand (cVOD), which is on demand content streamed or downloaded via a cable, telecommunications or satellite provider (e.g., HBO, Showtime, Starz). o Transactional on Demand (TOD): A temporary license (rental) of a movie or special event from an operator for a fee for a limited and pre-determined viewing period (such as 24 or 48 hours) for ondemand viewing. o Unique visitor: A person who visits an app or digital media property at least once over the course of a month.

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Multi-Platform 4

Digital Media 8

Mobile 21

Social Media 28

TV & Cross Platform 37

Advertising 48

E-Commerce 55

Box Office 64

Ten Trends of 2016 67

Growth in Digital Media Time Spent in Minutes (MM) Source: comScore Media Metrix Multi-Platform & Mobile Metrix, U.S., Dec 2015 vs. Dec 2014 vs. Dec 2013

Desktop Smartphone Tablet Total digital media 1,600,000 usage has nearly tripled since 2010, 1,400,000 160,767 +30% and since 2013 it’s 197,446 vs. 2013 1,200,000 up 35%, with smartphone having 1,000,000 123,661 grown 78% and +78% 646,324 787,541 contributing to 92% 800,000 vs. 2013 441,693 of the total increase 600,000 in time spent. Tablet is also seeing very 400,000 strong growth over 505,591 551,184 500,173 -1% that 2-year period at 200,000 vs. 2013 30%, while desktop 0 is down slightly. Dec-2013 Dec-2014 Dec-2015

Share of Digital Media Time Spent by Platform Source: comScore Media Metrix Multi-Platform & Mobile Metrix, U.S., Total Audience

70% +12pts Share of Digital Time Spent on MOBILE Although desktop is 65% relatively flat in total 65% engagement, it is losing share to 60% +12pts Share of Digital Time Spent on MOBILE APP mobile – which now 56% accounts for 65% of 55% 53% digital media time spent. Mobile apps 50% +12pts Share of Digital Time Spent on SMARTPHONE APP 47% now drive the 47% majority of digital 45% 44% time spent at 56%, and smartphone 40% apps alone look to account for a 35% 35% 35% majority of digital -12pts Share of Digital Time Spent on DESKTOP media consumption 30% in 2016. Dec-2013 Jun-2014 Dec-2014 Jun-2015 Dec-2015

Share of Demographic Audiences by Platform Usage Source: comScore Media Metrix Multi-Platform, U.S., Age 18+, Dec 2015 / Dec 2014 / Dec 2013

100% 5% 6% 3% 6% 7% 9% 12% 13% 10% Virtually all 18-34 90% 18% 21% 20% year-old Millennials 80% (97%) are mobile 70% 57% Mobile Only users, while 20% 60% 68% 67% don’t use desktop at 68% 77% 84% Multi-Platform all. The Age 35-54 50% 76% 76% 67% 82% demographic has 40% 74% 77% Desktop Only the highest 30% percentage of multi- 20% 40% platform users 26% 10% 22% 26% 15% 18% (82%), while the 12% 11% 10% 8% 0% 5% 3% oldest segment still has a sizeable, but shrinking, portion of its audience that Age 18+ Age 18-34 Age 35-54 Age 55+ only uses desktop.

Share of Desktop Browser Activity Source: comScore Custom Analytics, U.S., Total Audience

50% +4pts Google Chrome Google Chrome 45% 45% gained 4 40% 41% percentage points of the desktop browser 35% market in the 2nd -3pts Internet Explorer/Microsoft Edge 31% half of last year, as 30% 28% it looks to host the 25% majority of desktop 20% activity in 2016. 17% -3pts Firefox Safari also saw 15% 14%

+1pts Safari slight gains, while Share of Desktop Page Visits Page Desktop of Share 10% 10% 11% Microsoft and Firefox browsers 5% +0pts Other 2% 2% experienced 0% declines. Jun-2015 Dec-2015

Share of Desktop Searches for Explicit Core Search Market Source: comScore qSearch, U.S., Q4 2015

2% 1% Google remains the strong leader in the U.S. search market 12% with nearly 2/3rds of Google all search queries conducted. Bing However, 2nd and 3rd players Bing and Yahoo 21% Yahoo both increased their Ask market shares 64% about one AOL percentage point from the previous year.

Number of Digital Media Properties Reaching Unique Visitor Thresholds Source: comScore Media Metrix Multi-Platform, U.S., Dec 2015 / Dec 2014

20-50 MM 50-100 MM 100+ MM There are a growing 250 number of digital media properties reaching large 200 +50% audiences in the 21 tens of millions, with 14 43 206 above 20 150 +10% million. In addition 39 to 34 additional +19% properties reaching 100 20 MM UVs in 2015, there were seven 142 new properties 119 50 achieving the 100 Number of Digital Media Properties Media Digital of Number million milestone vs. the same period in 0 2014. Dec-2014 Dec-2015

Growth in Top 1000 Digital Media Property Audiences Source: comScore Media Metrix Multi-Platform, U.S., Dec 2013 – Dec 2015

18.0 TOTAL DIGITAL Over the past two 16.8 16.0 years, digital media audiences of the 14.0 Top 1000 properties MOBILE have surged to an 12.0 12.3 11.3 average 16.8 million 10.0 visitors per month. This has been 8.0 8.1 7.0 driven by a more than doubling of 6.0 5.6 DESKTOP mobile audiences 4.0 while desktop audiences have 2.0 Average # of Unique Visitors by Platform (MM) by Platform Visitors Unique of # Average seen a gradual 0.0 slide. Dec-2013 Mar-2014 Jun-2014 Sep-2014 Dec-2014 Mar-2015 Jun-2015 Sep-2015 Dec-2015

Median Audience Sizes for the Top 100 Digital Media Properties Source: comScore Media Metrix Multi-Platform, U.S., Dec 2015 / Dec 2014 / Dec 2013

+120% vs. desktop alone Mobile audiences +73% continue to +59% vs. desktop alone represent an vs. desktop alone 56,780 60,000 increasingly 50,462 important 50,000 45,180 contribution to total digital audience. 40,000 Two years ago, 29,214 mobile helped boost 30,000 28,382 25,762 the audiences of the Top 100 digital 20,000 media properties by Unique Visitors (000) Visitors Unique 59% and more 10,000 recently that number has 0 Dec-2013 Dec-2014 Dec-2015 exploded to 120%.

Total Digital Desktop

Top Digital Properties: Unique Visitors (MM) by Platform Source: comScore Media Metrix Multi-Platform, U.S., Dec 2015

Desktop Only Multi-Platform Mobile Only The average Top 10 0 50 100 150 200 250 300 digital media Google Sites 248 MM property has 37% of its audience visiting Facebook 219 MM only on mobile and Yahoo Sites 205 MM 31% visiting on both mobile and desktop. Amazon Sites 199 MM 6 of the Top 10 have Microsoft Sites 192 MM larger mobile-only audiences than AOL, Inc. 181 MM desktop-only Comcast NBCUniversal 155 MM audiences. Clearly, mobile is no longer CBS Interactive 151 MM a secondary digital Mode Media 144 MM touchpoint for many publishers. Apple Inc. 142 MM

Google Sites Unique Audience (MM) by Month Source: comScore Media Metrix Multi-Platform, U.S., Dec 2014 – Dec 2015

250 2 of Top 5 Google retained a 248 Desktop Domains strong lead on its #1 248 247 #1 Google.com #2 Facebook.com position among all 246 #3 Yahoo.com 246 245 245 digital media #4 YouTube.com #5 Amazon.com properties, reaching 244 243 243 242 an average of 95% 242 242 of U.S. internet 242 241 5 of Top 10 241 users each month. Mobile Apps 240 #1 Facebook Its lofty position 238 #2 Facebook Messenger atop the ranking is #3 YouTube Unique Visitors (MM) Visitors Unique 238 thanks to several #4 Google Maps #5 Google Search high-ranking digital 236 #6 Google Play media assets on #7 Pandora Radio both the desktop 234 #8 Gmail #9 Amazon Mobile web and mobile. 232 #10 Instagram Dec-2014 Mar-2015 Jun-2015 Sep-2015 Dec-2015

Digital Media Properties Reaching 100 Million Unique Visitor Milestone in 2015 Source: comScore Media Metrix Multi-Platform, U.S., Dec 2014 – Dec 2015

130,000 Linkedin reached 120,000 the 100 MM visitor milestone in the first 110,000 month of 2015, followed in March 100,000 by another social network Twitter and 90,000 Time Inc.’s group of publisher sites. Unique Visitors (000) Visitors Unique 80,000 Time Inc., which 70,000 was founded before the digital age, was 60,000 joined by fellow print publisher Hearst and traditional brick- and-mortar retailer Walmart. Twitter Time Inc. Network (U.S) Wal-Mart Linkedin Hearst

Y/Y Digital Audience Growth of Selected Traditional Print Publishers* Source: comScore Media Metrix Multi-Platform, U.S., Dec 2015 / Dec 2014

Dec-2014 Dec-2015 Several major +26% 120 +46% traditional print +27% 100 publishers experienced greater +78% 80 than 20% visitor +40% +22% gains in 2015, led 60 +29% +58% +37% by the Washington 40 Post with 78% year- Unique Visitors (MM) Visitors Unique +29% +21% over-year audience 20 growth and Dow 0 Jones & Company (home of The Wall Street Journal) with 58% growth.

* Based on selection of ‘traditional print publishers’ with 20 percent year-over-year unique visitor growth. © comScore, Inc. Proprietary. 17 At the content category level, most now get a majority of their traffic from mobile and are continuing to shift toward that platform.

Share of Content Category Time Spent by Platform Source: comScore Media Metrix Multi-Platform, U.S., Dec 2015 Mobile Point Desktop Mobile Change vs. 2014 Nearly every Portals 69% 31% + 4 pts category has Business/Finance 58% 42% + 12 pts become more mobile over the past Entertainment - News 51% 49% + 10 pts year, but Personals + 2 pts Health - Information 46% 54% and Retail are News/Information 44% 56% + 6 pts among those seeing Sports 39% 61% + 11 pts the most dramatic Retail 38% 62% + 13 pts shifts in time spent. Lifestyles 36% 64% + 5 pts The number of Personals 23% 77% + 15 pts categories getting the majority of its Social Networking 21% 79% + 5 pts engagement from Online Gaming 12% 88% + 1 pts desktop is rapidly Photos 8% 92% - 1 pts dwindling. Maps 6% 94% + 4 pts

Mobile Category Penetration for Key Content Categories Source: comScore Mobile Metrix, U.S., Age 18+, Dec 2013 – Dec 2015

70% While social media, Health Info 62% communications and 60% entertainment categories have always 50% 52% 49% done well on mobile, many consumers are Online Banking 40% now branching out to 36% 34% perform other 32% 30% Travel Info Career Resources functions. Consumers 23% 25% increasingly use mobile 20% to access information % Audience Reach Audience % 20% 22% 18% on health, careers, and Event Tickets 14% 10% Online Travel Agents travel, and they increasingly conduct banking transactions 0% and buy airline and event tickets.

Y/Y Unique Visitor Growth of Selected Fast Rising Mobile Apps* Source: comScore Mobile Metrix, U.S., Age 18+, Dec 2015 / Dec 2014

Two leading retail GIF Keyboard 931% home improvement brands ranked Lowe's 920% among the fastest SiriusXM 823% rising mobile apps in 2015, as Lowe’s Nextdoor 717% and The Home Depot ramped up Airbnb 717% their mobile OfferUp 607% presences. Airbnb also saw major OneDrive 551% growth as the company continues The Home Depot 541% to shake up the lodging and travel The Washington Post 514% industry. Imgur 421%

* Based on selection of apps with at least 1 million unique visitors and growing 400 percent year-over-year. © comScore, Inc. Proprietary. 20 Mobile

Smartphone Penetration of Mobile Phone Market Source: comScore MobiLens, U.S., Age 13+, 3 Mo. Avg. Ending Dec 2005 - 3 Mo. Avg. Ending Dec 2015

90% Since the end of 79% 2005, smartphone 80% 75% penetration of the 70% 65% mobile phone market has grown 60% 54% from next to nothing to 79%. In the past 50% 42% 3 years, a quarter of 40% the mobile phone market made the 30% 27% switch from feature phone to 20% 17% 11% smartphone, a trend 10% that continues but is 3% 6% 2% slowing. 0% Dec 2005 Dec 2006 Dec 2007 Dec 2008 Dec 2009 Dec 2010 Dec 2011 Dec 2012 Dec 2013 Dec 2014 Dec 2015

Smartphone Penetration by Demo Source: comScore MobiLens, U.S., Age 13+, 3 Mo. Avg. Ending Dec 2015 / Dec 2014

Dec-2014 Dec-2015 Millennials saw the 100% 94% 93% most significant 90% 89% 90% 84% gains in smartphone 79% 81% penetration in 2015, 80% 76% with both 18-24 and 70% 25-34 year-olds

60% 57% 58% solidly above 90%. Despite the Age 55+ 50% segment having the 40% most room for 30% growth, its 1-point annual gain may 20% indicate a slow 10% climb to attaining 0% those higher levels Total: Age 18+ Age 18-24 Age 25-34 Age 35-54 Age 55+ of penetration.

Smartphone Platform Market Share: 10-Year Trend Source: comScore MobiLens, U.S., Age 13+, 3 Mo. Avg. Ending Dec 2005 - 3 Mo. Avg. Ending Dec 2015

100% Smartphone OS 90% market share has 80% shifted immensely 43% from its early years, 36% 42% 42% 70% but has remained 60% 30% HP/Palm relatively stable 50% Symbian since 2013. It now BlackBerry appears that the 40% 25% most popular device Microsoft 30% for accessing the 53% 53% 47% 51% 53% iOS internet will be 20% 25% 29% Android dominated by two 10% 17% major players’ 9% 0% 1% 5% software platforms for the foreseeable future.

Smartphone OEM Market Share: 2-Year Trend Source: comScore MobiLens, U.S., Age 13+, 3 Mo. Avg. Ending Dec 2013 - 3 Mo. Avg. Ending Dec 2015

50% Apple In the past two 45% years, the U.S. 42% 43% 40% market share for smartphone original 35% equipment 32% All Others 30% 29% manufacturers 28% 25% 26% (OEMs) has seen Samsung minor growth from 20% Apple and Samsung 15% at the expense of most others. Like 10% the smartphone 5% software market, the 0% OEM market is maturing in the U.S.

Trend of Apple iPhone Users (MM) by Device Family Source: comScore MobiLens, U.S., Age 13+, 3 Mo. Avg. Ending Dec 2014 - 3 Mo. Avg. Ending Dec 2015

90 Apple’s iPhone 3, 4, 80 7.1 7.5 8.0 and 5 models 6.4 6.8 7.0 9.1 9.8 10.7 11.6 3.7 4.7 5.6 collectively lost 23 70 7.9 million users in 10.3 12.7 14.9 18.3 20.8 20.6 22.1 23.1 2015, but more than 60 24.0 26.1 28.5 30.5 made that up by 50 gaining nearly 31 39.3 million new iPhone 39.0 40 38.7 39.0 6 and 6 Plus users. 39.0 38.7 37.0 38.5 38.3 The iPhone 6/6S 30 37.0 34.9 32.6 models look to 30.8 surpass the iPhone Apple iPhone Users (MM) Users iPhone Apple 20 5/5S/5C models in 24.2 10 21.7 20.3 19.2 early 2016 for total 16.1 15.2 15.4 14.6 13.3 12.1 11.3 10.5 9.7 number of owners in 0 Dec-2014 Jan-2015 Feb-2015 Mar-2015 Apr-2015* May-2015* Jun-2015 Jul-2015 Aug-2015 Sep-2015 Oct-2015 Nov-2015 Dec-2015 the U.S. Apple iPhone 3G/4/4S Apple iPhone 5/5S/5C Apple iPhone 6/6S Apple iPhone 6/6S Plus

* The months of April and May 2015 were calculated using their single month of data vs. the 3-month

average, due to an improved sample weighting methodology introduced in April. © comScore, Inc. Proprietary. 26 Large screen smartphones have been quickly gaining in popularity and overtook small screen smartphone ownership in April 2015.

Device Ownership by Smartphone Screen Size and Tablet Source: comScore MobiLens, U.S., Age 13+, 3 Mo. Avg. Ending Sep 2014 - 3 Mo. Avg. Ending Dec 2015

140 Smartphone 4.5”+ More consumers 120 are adopting Tablet smartphones with a 100 4.5” display or greater, while tablet 80 ownership has Smartphone <4.5” plateaued in the 60 past year. This correlation could be Device Owners (MM) Owners Device 40 due to tablets and larger screen 20 smartphones sharing many of the 0 same use cases.

* The months of April and May 2015 were calculated using their single month of data vs. the 3-month

average, due to an improved sample weighting methodology introduced in April. © comScore, Inc. Proprietary. 27 Social Media

Share of Total Digital Time Spent by Content Category Source: comScore Media Metrix Multi-Platform, U.S., Total Audience, December 2015

Social Networking Social Networking 19% leads all categories Other in engagement, 34% accounting for 1 out of 5 minutes spent online. The strength Multimedia of this category, 12% along with Email and IM, highlights that one of digital’s News/Information primary functions is 4% Radio for communication – 8% E-mail now more so than 4% Portals ever with the rise of Instant Messengers Online 6% mobile. 4% Retail Gaming 5% 5%

Share of Time Spent on Social Media Across Different Platforms Source: comScore Media Metrix Multi-Platform & Mobile Metrix, US, Dec 2015 / Dec 2014 / Dec 2013

Desktop Smartphone App Smartphone Web Tablet App Tablet Web The vast majority of social media consumption occurs on mobile apps, Dec-2015 21% 6% 9% 3% 61% driven largely by smartphones. The smartphone app is the dominant social Dec-2014 26% 53% 4% 13% 3% platform in the U.S., now accounting for 61% of all social media time spent, up 8 percentage Dec-2013 33% 53% 3% 10% points from last year.

Age 18-34 Digital Audience Penetration vs. Engagement of Leading Social Networks Source: comScore Media Metrix Multi-Platform, U.S., Dec 2015

1,200 After Facebook, relative newcomer 1,000 Snapchat has the highest engagement 800 per visitor among Millennials, just 600 ahead of Instagram. The latter network has the largest 400 audience penetration after

Average Monthly Minutes Visitor per Minutes Monthly Average 200 Facebook, followed by Twitter and 0 LinkedIn. 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

% Reach Among Age 18-34

Age 35+ Digital Audience Penetration vs. Engagement of Leading Social Networks Source: comScore Media Metrix Multi-Platform, U.S., Dec 2015

1,200 Age 35+ users have lower audience 1,000 penetration and lower engagement 800 than Millennials for just about every 600 social network – the one exception being slightly higher 400 engagement on the business-oriented

200 LinkedIn. Average Monthly Minutes Visitor per Minutes Monthly Average

0 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

% Reach Among Age 35+

Facebook Q4 2015 Share of Total Digital Media Time Spent by Platform Source: comScore Media Metrix Multi-Platform & Mobile Metrix, U.S., Q4 2015

Facebook is the #1 digital media property by time Total Digital 13.8% 1.9% 1.3% 17.2% spent. While it maintains an impressive double- Desktop 9.9% 10.0% digit market share of desktop time spent, Mobile 15.8% 3.0% 2.0% 0.3% 21.2% it really shines on mobile platforms, Smartphone 16.2% 3.1% 2.1% 0.4% 21.8% where its four core apps each contribute a Tablet 13.9% 2.5% 1.6% 18.0% meaningful share of engagement. Facebook Messenger Instagram WhatsApp

Demographic Composition % of Major Social Networks Source: comScore Media Metrix Multi-Platform, U.S., Age 18+, Dec 2015 100% 5.5 1.0 10.6 8.9 8.4 7.4 7.5 3.5 8.0 8.7 Snapchat is the 90% 11.1 7.7 youngest skewing 11.1 9.5 14.1 14.5 15.2 13.7 social network with 80% 15.7 11.7 15.5 almost half of its 15.5 14.4 17.4 users between 18- 70% 18.3 16.7 16.6 18.1 Age 65+ 24 years old and 60% 29.2 rds 19.4 16.8 17.1 Age 55-64 2/3 of them 50% 20.0 20.5 20.9 Age 45-54 between the ages of 18.8 20.8 18-34. The most Age 35-44 40% 21.7 22.1 popular networks 25.6 Age 25-34 among Millennials 30% 22.2 20.3 22.4 23.6 23.9 Age 18-24 tend to be those 46.8 20% with visually- 28.1 focused content that 22.9 26.9 10% 16.5 15.5 18.2 16.8 16.5 can be consumed 0% easiest on mobile.

Snapchat Smartphone App Penetration by Age Source: comScore Mobile Metrix, U.S., Age 18+, April 2013 – Dec 2015

70% Age 18-24 More than three in 64% every five 18-24 60% year-olds now use Snapchat on their 50% smartphones each month. Older Millennials are 40% Age 25-34 gaining ground fast at 31% penetration, % Reach % 30% 31% while those age 35+

24% are still below 10% 20% penetration. Is Age 35+ popularity among Millennials a 10% 8% predictor of eventual 5% mainstream 0% 2% adoption? Apr-2013 Dec-2013 Aug-2014 Apr-2015 Dec-2015

Linkedin.com Penetration by Age Demographic Source: comScore Media Metrix Multi-Platform, U.S., Dec 2013 – Dec 2015

70% Linkedin has seen a dramatic growth 60% trajectory in the past 57% Age 25-34 two years, and while 53% Age 35-54 49% the gains cut across 50% demographic 48% Total Age 18+ Age 18-24 segments, the 40% 40% biggest strides have Age 55+ been made among

29% Millennials. 18-24

% Reach % 30% 28% year-olds have seen 25% penetration surge 25% 20% from 14% to 48% while 25-34 year-olds 14% have overtaken 35-54 10% year-olds as the highest penetration

0% demo group. Dec-2013 Mar-2014 Jun-2014 Sep-2014 Dec-2014 Mar-2015 Jun-2015 Sep-2015 Dec-2015

Quarterly Hours per HH Watching TV: Live & DVR Period Source: comScore TV Essentials, U.S., Q4 2014 – Q4 2015, Live +15 Day DVR Playback Period

Despite fewer cable 1,200 Live +15 Day DVR Period +7% y/y households overall, 1,004 the average watch 1,000 936 961 940 time among viewing 922 households is increasing vs. a year 800 ago. The availability of more viewing options appealing to 600 a wider array of +7% y/y tastes, in addition to the continued 400 360 356 356 332 330 expansion of

premium original Total Hours of TV Watched per HH per Watched TV of Hours Total 200 scripted programming on cable networks has likely contributed 0 to this effect. Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015

Cable Video On Demand (cVOD) Share of Time Spent Source: comScore OnDemand Essentials, U.S., Q1-Q3 2015*

100% 7.1% The majority of cVOD 8.6% viewing is Free On 90% Demand, but most of the growth is 80% 30.0% 31.2% happening via subscription services 70% such as HBO and Showtime. TOD, 60% which includes fee- Transactional On Demand (TOD) based rentals or 50% special events, lost Subscription Video On Demand (SVOD) 40% share in 2015 – Free On Demand (FOD) perhaps due to 30% 61.4% 61.7% subscription VOD increasingly filling the 20% consumer need for great storytelling and 10% high production value. 0% Q1-Q3 2014 Q1-Q3 2015

* Data originally appears in the State of VOD: Trend Report: http://www.rentrak.com/section/our_services/analytics/svod/ © comScore, Inc. Proprietary. 39 Among Free On Demand content, the TV Entertainment and Kids categories increased their total share of transactions by 4% in 2015.

Free On Demand (FOD) Share of Transactions* by Category Source: comScore OnDemand Essentials, U.S., 2015 / 2014**

100% The TV 10.0% 9.3% 90% Entertainment 5.1% 5.5% category accounts 80% 13.9% 10.2% Other for the majority of FOD viewing while 70% Movies also being one of 25.6% 60% 23.3% Music the faster growing categories. Along 50% Kids with Kids content, 40% TV Entertainment which is also growing its share of 30% viewing 47.8% 49.4% transactions, the 20% two make up three 10% of every four Free On Demand views. 0% 2014 2015

* A VOD transaction is defined as any On Demand streaming order or view. ** Data originally appears in the State of VOD: Trend Report: http://www.rentrak.com/section/our_services/analytics/svod/ © comScore, Inc. Proprietary. 40 Moreover, the TV Entertainment category’s share of all VOD time spent has tripled in 6 years.

Video On Demand (VOD) Share of Transactions* and Time Spent in TV Entertainment Category Source: comScore OnDemand Essentials, U.S., Video On Demand

45% TV Entertainment 40% 40% content has been 40% Share of Transactions 37% rapidly gaining 36% 37% Share of Time Spent share of total VOD 35% 32% 32% transactions and

30% 29% time spent over the 25% past several years 25% 23% before stabilizing in 19% 21% 2015. Other content 20% categories such as 16% 16% Movies, Music, 15% Kids, News and Sports account for 10% the remaining share 5% of transactions and time spent. 0% 2009 2010 2011 2012 2013 2014 2015

* A VOD transaction is defined as any On Demand streaming order or view. © comScore, Inc. Proprietary. 41 The majority of On Demand revenue comes from OTT subscription services, such as Netflix, Amazon Prime and Hulu Plus.

2015 Share of Marketplace Revenue for On Demand Content* Source: comScore OnDemand Essentials, Digital Download Essentials and Internet TV Essentials, U.S., FY 2015

Most of the $8.7 10% billion in On Demand revenue came from recurring 12% Over the Top Subscription Video on Demand subscription fees. (OTT SVOD) Purchases and rentals via digital Electronic Sell-Through (EST) retailers such as Amazon, Google 57% Internet Video on Demand (iVOD) Play and iTunes 21% contributed to another 1/3rd share, Transactional on Demand (TOD) while On Demand rentals from a cable operator only accounted for 10%.

* Please refer to page 2 of this report for the full definitions of these On Demand industry terms. © comScore, Inc. Proprietary. 42 There are more media platforms competing for consumers’ attention than ever, as shown by digital eclipsing Live TV among Millennials.

Share of Platform Time Spent by Demographics Source: comScore Xmedia and Media Metrix Multi-Platform, U.S., Q4 2015, Live TV

There’s a clear trend showing that Age 55+ 70% 14% 15% as demographic segments get younger, those consumers are more likely to spend Age 35-54 57% 21% 22% time on their mobile device and less likely to spend time watching Live TV. It’s possible that Age 18-34 47% 14% 40% digital share of time spent among 35-54 year-olds might also 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% soon surpass Live TV. TV Desktop Mobile

Cable Network Analysis: TV + Digital Cross-Platform Audience Reach Analysis Source: comScore Xmedia, U.S., November 2015 – Live TV

120 109.3 MM This analysis of 10 cable networks 100 12.7 12.7 showed that their digital properties 11.6 14.6 11.6 achieved massive 80 5.1 incremental audience reach on 60 desktop and mobile. TV Reach On average, these 40 85.0 Incremental Desktop Reach 85.0 networks attracted Reach (Millions) Reach Desktop Audience Overlap 24 million additional Incremental Mobile Reach 20 eyeballs on digital, Mobile Audience Overlap extending their audience footprints 0 by 29%. TV Desktop Mobile Total

Monthly Audience Reach of Primetime Broadcast Networks vs. Top Digital Media Properties Source: comScore Xmedia (Live TV, 8PM-11PM) and Media Metrix Multi-Platform, U.S., November 2015

300 Traditionally, 247 primetime TV has 250 been the advertising 228 213 219 205 202 203 medium that marketers use to 200 184 reach the largest audiences. Even 150 though that still

holds true today, the Reach (MM) Reach 100 top digital media properties (Google, Facebook, Yahoo, 50 Microsoft) can also achieve a similar, if 0 not larger, reach Network 1 Network 2 Network 3 Network 4 Google Sites Facebook Yahoo Sites Microsoft over the course of a Primetime Primetime Primetime Primetime Sites single month. TV Reach Desktop Reach Incremental Mobile Reach

YouTube: Trend in Total Minutes (MM) Source: comScore Media Metrix Multi-Platform, U.S., Dec 2013 – Dec 2015

120,000 The total time consumers spend 100,000 on YouTube is up for both desktop and mobile, but its 80,000 Mobile +95% mobile engagement has nearly doubled over the past two 60,000 years. It’s easier than ever to consume video Total Minutes (MM) Minutes Total 40,000 anytime and Desktop +8% anywhere, and 20,000 mobile is the best medium for immediate, on-the- 0 go viewing. Dec-2013 Mar-2014 Jun-2014 Sep-2014 Dec-2014 Mar-2015 Jun-2015 Sep-2015 Dec-2015

Audience Reach Analysis by Demographic: Major Broadcast TV Network in Primetime + YouTube Source: comScore Xmedia, U.S., November 2015 – Live TV (8PM-11PM) 100.0% 97% 96% 91% Cross-platform 90.0% media planning can break down silos 80.0% 38% 24% and allow brands to 43% more efficiently 70.0% reach audience 60.0% targets. Over the course of a month,

50.0% YouTube (Incremental) a YouTube ad buy % Reach % 40.0% Major Primetime Network across desktop and 67% mobile has the 30.0% potential to deliver 54% 58% 90%+ target reach 20.0% when coupled with 10.0% network primetime TV. 0.0% Age 18-34 Age 35-54 Age 55+

Top Advertisers by Share of Total Desktop Display Ad Impressions Source: comScore Ad Metrix, U.S., FY 2015

Verizon Communications 1.27% Verizon led all advertisers by Intertainment Media 1.17% delivering roughly 1 out of every 80 AT&T 0.99% desktop display ad Microsoft 0.88% impressions in 2015. Close eBay 0.73% competitor AT&T rd Procter & Gamble 0.73% ranked 3 , while the rest of the Top 10 Nissan Motor 0.61% included leading Amazon 0.60% consumer packaged goods, retail and Kellogg 0.58% technology companies. American Express 0.58%

Percentage Point Lift in Brand Metrics for Desktop and Mobile Ads Source: comScore BSL and mBSL Benchmarks, U.S., Full Year 2015

Mobile ads caused Desktop Mobile point lifts up to 2.5x greater than ads on desktop across four 1.4 Aided awareness 2.3 key brand metrics and performed strongest in bottom- 1.3 Favorability 2.7 funnel metrics, such as intent to buy and likelihood to recommend. Less 1.5 Likelihood to recommend 3.3 ad clutter and proximity to point of purchase may be driving better 1.4 Purchase Intent 3.7 effectiveness for mobile ads.

Incidence of Ad Blocker Usage Among U.S. Desktop Internet Users Source: comScore Custom Analytics, U.S., December 2015

25% Ad blocker usage is a concern for publishers but has 20% 19% remained around 10% on desktop over the past six months. 15% Publishers reaching a 15% 14% young male audience are most likely to be 11% affected. Fortunately 10% industry bodies and 10% 9% 9% 8% 8% 8% 8% publishers are now 7% 7% 7% taking action to address the issue by 5% improving user experience and enhancing communication with 0% their readership Total 18-24 25-34 35-44 45-54 55-64 65+ around value Male Female exchange.

Percentage of Viewable Ad Impressions in U.S. Source: comScore vCE Norms, U.S., Q4 2015

A full 52% of all desktop ad 7% impressions are unable to deliver an advertising impact. Viewable While most of these non-viewable ads are simply delivered Non-viewable to parts of the web 48% page that are out of view, a meaningful 45% Invalid Traffic (IVT) percentage is being delivered to bots and by definition not viewable to a human.

Invalid Traffic (IVT) by Type Source: comScore Custom Analytics, U.S., Q4 2015

Sophisticated IVT, which according to the Media Rating Council (MRC) includes “traffic originating from 25% hijacked devices, malware or % Sophisticated IVT misappropriated content,” accounts for the vast majority of % General IVT invalid traffic. Sophisticated 75% detection techniques are therefore required for advertisers to mitigate the potential for waste.

Percent of Viewable Ads by Select Publisher Category Source: comScore vCE Benchmarks, U.S., Q4 2015

Several publisher 61% categories perform 59% 57% 57% 56% 54% well above the 52% 50% overall online 47% benchmark when it comes to delivering viewable ads. At the top of the list are the Radio, Food, and Sports categories, each of which is approximately 10 percentage above the overall average of 48%. Radio Food Sports Music Social Media News/Info TV Health/Wellness Technology

Desktop & Mobile Digital Commerce Share of Corresponding Consumer Spending* Source: U.S. Dept. of Commerce, comScore e-Commerce & m-Commerce Measurement, U.S., 2004 - 2015 16% 15.0% 15% 13.5% Digital’s share of (Q4 ‘14) Q4 ‘15 14% consumer 13% discretionary 12% 12.5% spending, which 11% Q4 ‘15 peaks in seasonally 10% 11.8% colder months, 9% (Q4 ‘14) reached an all-time 8% 7% high in Q4 2015 at 6% 15%. Digital 5% commerce share 4% appears to be Digital Commerce Share (desktop + mobile) 3% accelerating in 2% e-Commerce Share (desktop) recent years due to 1% the impact of 0% mobile.

*Note: e-Commerce share is shown as a percent of DOC’s Total Retail Sales excluding Food Service & Drinking, Food & Bev. Stores, Motor Vehicles & Parts, Gasoline Stations and Health & Personal Care Stores. © comScore, Inc. Proprietary. 56 Boosted by a growing share of mobile, total digital commerce surpassed $90 million in Q4 2015 to mark its highest total ever.

Total U.S. Retail Digital Commerce Growth Source: comScore e-Commerce & m-Commerce Measurement, U.S., 2012 - 2015

$100.0 Desktop Mobile Y/Y % Growth 18% Digital commerce 16% 16% growth rates have $90.0 15% 15% 15% 16% 14% remained relatively 14% 14% $15.6 $80.0 stable in the past 13% 13% $10.7 14% 12% two years, hovering $70.0 12% between 12-16%. $8.3 $11.1 12% $11.1 $11.4 Y/Y % Growth Despite strong $60.0 $7.3 $6.9 $6.7 10% growth rates $5.9 $50.0 $4.7 $5.8 through much of

8% 2015, however, Q4 Billions ($) Billions $40.0 $76.9 saw a material slow- $72.1 $63.1 6% down in the y/y $30.0 $61.1 $59.8 $58.3 $56.1 $54.8 $53.9 growth rate driven in $50.2 $49.8 $47.5 $20.0 4% part by a tougher comparison to a $10.0 2% strong Q4 2014. $- 0% Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015

Full Year 2015 Y/Y Retail Spending Growth by Channel Source: U.S. Dept. of Commerce, comScore M-Commerce and E-Commerce Measurement, U.S., FY 2015 / FY 2014

+60% +56% 2015 was a huge year for mobile +50% commerce, seeing annual growth of 56% and gaining a +40% larger share of retail dollars. Desktop e- commerce is still +30% experiencing moderate growth at +20% 8%, but it has dipped into single digits as mobile +10% +8% continues to emerge as a buying +1% platform. +0% Total Discretionary Retail e-Commerce m-Commerce

Quarterly Trend in Mobile Commerce as a Share of Total Digital Commerce Source: comScore M-Commerce and E-Commerce Measurement, U.S., Q2 2010 – Q4 2015

16.9% 16.4% M-commerce has 15.6% 15.4% come a long way in the past 5 years and 13.0% now contributes

11.7%11.5% about 1 in every 6 11.3% 11.1%11.1% 10.5% 10.8% dollars spent via 9.8% digital commerce. 9.0% 9.3% 8.8% 8.6% 2015 saw an 8.1% especially strong 6.6% jump in its percent 5.8% share of the total market as 3.6% consumers became 2.4% more comfortable 1.8% transacting on their smartphones and tablets. Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012 2013 2013 2013 2013 2014 2014 2014 2014 2015 2015 2015 2015

2015 Share of Retail Time Spent vs. Spending by Platform Source: comScore M-Commerce and E-Commerce Measurement, U.S., FY 2015

Mobile accounts for 60% of time spent shopping online, but only 16% of all retail dollars spent, due to 40% factors such as security concerns and smaller screen size. This m- commerce 84% monetization gap will 44% continue to narrow Gap over time, but the 60% shares of time spent and dollars spent likely won’t ever Desktop 16% reach equilibrium. Mobile Time Spent Dollars Spent

Y/Y % Change in Total Retail Digital Commerce Dollars by Category Source: comScore E-Commerce Measurement, U.S., FY 2015 vs. FY 2014

Video Games, Consoles & Accessories 44% Online retail grew Toys & Hobbies 42% 14% year-over-year Sport & Fitness 32% in 2015, with the Jewelry & Watches 30% fastest growing Event Tickets 29% categories seeing Music, Movies & Videos 25% most of their gains Flowers, Greetings & Misc Gifts 23% on mobile. The top Apparel & Accessories 19% 3 product categories Home & Garden 16% in terms of growth Furniture, Appliances & Equipment 15% contain inexpensive, Total Digital Commerce 14% less complicated Computer Software 12% purchases that Books & Magazines 11% consumers are Consumer Electronics 9% increasingly willing Consumer Packaged Goods 8% to make on their Office Supplies 6% smartphones and Computers / Peripherals / PDAs 5% tablets. Digital Content & Subscriptions 5%

Digital Commerce Sales by Category: Apparel & Accessories vs. Computer Hardware Source: comScore E-Commerce & M-Commerce Measurement, U.S., Q1 2013 – Q4 2015

$20.0 Computer Hardware $17.2 $18.0 has long been the $15.9 #1 category in $16.0 COMPUTER HARDWARE digital commerce, $13.5 $16.0 but recent strength $14.0 $12.4 $15.0 $11.8 in the Apparel & $11.3 $11.8 $12.0 Accessories $9.9 $12.3 $10.2 $10.0 category – due in $10.0 $9.2 $9.1 $11.1 $11.0 large part to mobile $9.9 $10.0 $10.1 Billions ($) Billions commerce – vaulted $8.0 $8.4 $8.4 $8.4 it ahead in the first APPAREL & ACCESSORIES $6.0 $7.1 two quarters of 2015 before briefly $4.0 losing the lead in Q3, only to regain it $2.0 in the final quarter.

$0.0 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015

2015 Holiday Season: Digital Retail Visits (MM) by Platform Source: comScore Custom Analytics, U.S., Nov 1 – Dec 31, 2015 800 Black Friday Cyber Monday Mobile accounted 700 for 63% of all online retail visits this 600 TOTAL DIGITAL holiday season and outpaced desktop 500 every single day of the season. Mobile

Visits (MM) Visits 400 MOBILE visits peaked on 300 Black Friday, while desktop visits 200 peaked on Cyber Monday, which saw 100 DESKTOP more overall retail traffic than any - 11/1/2015 11/8/2015 11/15/2015 11/22/2015 11/29/2015 12/6/2015 12/13/2015 12/20/2015 12/27/2015 other day in 2015.

Top 10 Grossing Box Office Movies in 2015 Source: comScore Box Office Essentials, U.S., Jan. 1 – Dec. 31, 2015

Jurassic World $652.3 Star Wars had an impressive box Star Wars: The Force Awakens $652.0 office of $652 million in just two Avengers: Age Of Ultron $459.0 weeks of release at Inside Out $356.5 the end of the year, but Jurassic World Furious 7 $353.0 took the top spot American Sniper $348.8 overall. The Top 10 for 2015 featured Minions $336.0 mostly action The Hunger Games: Mockingjay Part 2 $269.6 movies and animated family- Martian, The $225.3 friendly films. Cinderella $201.2

Top 20 Digital Movie Purchases & Rentals in 2015 Source: comScore Digital Download Essentials, U.S., Jan. 1 – Dec. 31, 2015

RANK TITLE STUDIO 20th Century Fox 1 Gone Girl Fox 2 Kingsman: The Secret Service (2015) Fox was home to two of 3 American Sniper (2014) Warner the biggest movies 4 Interstellar (2014) Paramount in 2015 in terms of 5 The Hunger Games: Mockingjay - Part 1 (2014) Lionsgate total digital 6 Interview, The (2014) Sony 7 Big Hero 6 (2014) Disney purchases and 8 John Wick (2014) Lionsgate rentals. As with the 9 Fury Sony top grossing box 10 Mad Max 4: Fury Road (2015) Warner 11 Inside Out (2015) Disney office movies, action 12 Get Hard (2015) Warner films tended to be 13 Home (2015) Fox most popular 14 Hobbit, The: The Battle Of The Five Armies (2014) Warner among audiences, 15 Avengers: Age Of Ultron (2015) Disney 16 Equalizer, The Sony even on the “small 17 Birdman (2014) Fox screen.” 18 Spy (2015) Fox 19 Insurgent (2015) Lionsgate 20 San Andreas (2015) Warner

* Excludes NBC Universal and non-participating Independent distributors. EST revenue source: DEG © comScore, Inc. Proprietary. 66 Ten Trends for 2016

1. 2016 will be the year of cross-platform ̵ Over the past few years we’ve seen the convergence of desktop and mobile into a unified multi-platform digital environment. The next phase in media convergence is the collision of TV and Digital as a higher percentage of viewing happens via the internet and as consumers’ viewing patterns become more fluid across platforms. As measurement systems are developed to quantify this behavior, the media and marketing industries will be transformed by the power of cross-platform data.

2. Digital audience growth will subside, leading to a renewed focus on engagement and attention metrics ̵ Digital audiences have undergone a sustained period of growth from the emergence of the mobile internet, but signs that this growth trend is beginning to taper off point to a growing demand for metrics that go beyond demonstrating scale. Engagement metrics, such as time spent and meaningful visits, are likely to play an increasing role in articulating the value of a digital media property’s audience.

3. The smartphone app will account for the majority of all digital media consumption ̵ Time spent on smartphone apps has been consistently trending upward in the past few years, ending 2015 with a 47% share of total digital media engagement. It’s growth trajectory will continue in 2016 – particularly as mobile video viewing gains steam – on its way to representing the majority of all digital consumption time.

4. Mobile ad spend will get unlocked as measurement standards come into place ̵ Mobile advertising growth has been on a tear the past two years, which is little surprise given the shift in media consumption to smartphones and tablets. At the same time, measurement standards for mobile have lagged that of desktop, which has likely inhibited further ad spending on mobile. As those standards finally come into clearer view in 2016, advertisers will benefit from more comparable metrics and more scalable means of reaching the right consumers.

5. Social media will increasingly revolve around video content ̵ With Snapchat having now emerged as the next great social media company, there is a growing realization of the power of video to drive social resonance. Facebook and Instagram have already ramped up their video efforts, and more recently we’ve seen Twitter-owned Periscope capture the attention of users with its livestreaming capability.

6. Platform publishing optimization will emerge as digital’s newest cottage industry ̵ With publishers putting their content directly on 3rd party publishing platforms such as Facebook Instant Articles, Snapchat Discover and Apple News, a host of technological, analytic and revenue optimization challenges will arise that may exceed what publishers are equipped to efficiently handle in-house. Just as search engine optimization boomed during the first half of the 2000s, and social marketing optimization exploded in the late 2000s, the next big digital cottage industry will be built around publisher platform optimization.

7. Just as small screen viewing is shifting to the tiny screen, the big screen will be increasingly fought on the small screen ̵ TV – aka “small screen” – content viewing has increasingly shifted to even smaller screens such as smartphones and tablets in the past few years. A parallel shift we can expect to see accelerate in 2016 is from the movie theater screen to TV screen. As Netflix, Amazon, Hulu and others enter bidding wars for the rights to major motion pictures that would traditionally have a theatrical release, more first-run viewing of these films is likely to happen from the comfort of streaming video subscribers’ homes.

8. Wider availability of over-the-top (OTT) content will grow the Total Video pie, not cannibalize it ̵ The conversation around shifts toward OTT viewing on Netflix, Amazon and the like has traditionally been coupled with discussion of cord-cutting. But with more broadcast and cable networks – such as HBO, CBS, Disney and others – making their content available over-the-top via apps, there is a renewed opportunity to reach those non-Pay TV audiences who couldn’t otherwise be reached while not increasing the rate of cord-cutting.

9. Mobile commerce will surpass 20% share of total retail dollars spent on digital ̵ While m-commerce conversion will remain a relative friction point, a confluence of factors are improving to help mobile’s share of spending continue to accelerate. Faster connections, decreasing concerns over transaction security, larger phone screen sizes, and more frictionless navigation of e-commerce mobile sites and apps will all help push m- commerce share from under 17% in 2015 to more than 20% in 2016.

10. Content curation will emerge as a key area of tech and startup innovation ̵ The expansiveness and highly fragmented nature of media content today has created a huge problem for consumers who want to easily access and keep track of the TV shows, digital videos, podcasts, books, music, and articles they want to consume. At the same time, there remains untapped opportunity for more relevant content recommendation – leveraging social and other algorithms – that can help significantly improve the content discovery experience. That such large consumer friction points still exist suggest that the technology/media sector may be ripe for its next wave of innovation (ironically, just as talk of the tech bubble bursting reaches a fever pitch).

For more information about the report, please contact:

ANDREW LIPSMAN, VP Marketing & Insights [email protected] ADAM LELLA, Senior Marketing Insights Analyst [email protected]

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