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INNOVATION IN BROADCASTING MARKUS FRITZ, Director Commercial Development & Marketing INNOVATION distinguishes between “a leader and a follower ” INNOVATION IS CHANGE That unlocks new value Value centric innovation INNOVATING… WHILE SAFEGUARDING TECHNICAL RIGOUR

 Electric propulsion: already developed for station-keeping At platform level:  3 future satellites in our expansion programme using electric efficiency propulsion for in-orbit raising and station-keeping  Opportunity to optimize mission

 Signals protected from deliberate or accidental interference At payload level:  Improved allocation of electrical power to increase active channels security and flexibility  Frequency agile command receivers to expand options for repositioning

 Maximizing Quality: Ultra HD - next step in quality and growth

At market level:  Optimizing Delivery: OTT, Push VOD, Hybrid TV, Smart-LNB quality and access  Maximizing Connectivity: Teleports, Field Force

4 VALUE CENTRIC INNOVATION MAXIMIZING QUALITY

5 MAXIMIZING QUALITY – WHAT DOES ULTRA HD “4K” TV OFFER ?

Ultra High Definition TV (UHDTV) will offer:

Higher resolution Higher frame rate(s) More and deeper colours Higher Dynamic Range (HDR) UHDTV Immersive video and audio

In summary - an unrivalled new TV viewing experience

Industry consensus that Ultra HD is going to be the next “big thing”

6 MAXIMIZING QUALITY – WHAT DOES ULTRA HD “4K” TV OFFER ?

 Ultra HD - the better viewing experience

More pixels More colors

UHD 4K 3840x2160 MPEG-2 ca. 40 Mbit/s MPEG-4 ca. 80 Mbit/s Human HEVC ca. 20 Mbit/s vision COMPRESSION

UHDTV Cinema x 2160) 4k(4096 1920x1080 HD (BT.2020) MPEG-2 ca. 19 Mbit/s MPEG-4 ca. 10 Mbit/s HEVC ca. 5 Mbit/s COMPRESSION HDTV (BT.709)

SD 720x576 MPEG-2 ca. 4 Mbit/s MPEG-4 ca. 2 Mbit/s HEVC* ca. 1 Mbit/s COMPRESSION

HEVC will bring UHD requirements to affordable levels for broadcasters 7 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

Pre-requisites for Ultra HD

 The right content

 The right standards

 The right equipment

 The right demand

 The right distribution

The role of satellite to drive

8 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right content

 “Netflix launches 4KTV streaming offer”  “DirecTV first multi-channel provider to deliver 4K to home”  “The Weather Channel’s plans” to fully convert to 4K by 2018”  “Sky delivers first 4K TV broadcast in the UK”  “Sky Germany launches UHD demo for IFA 2014”  “Over-the-air 4K broadcast of (Roland Garros) French Open”  “Rai screens 1st UHD Documentary (Rossini) and “La Boheme””  “BBC showcases Wimbledon and Wildlife Documentary in 4K”

 “Red bull gives wings to 4K”  “Tricolor TV launches 4K channel”

9 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right content

 Major feature films & sports events e.g. FIFA World Cup™ 2104 already captured in 4K

 150 feature films and TV shows were available as UHD master copy and almost 800 in UHD source format by 2013

 UHD expected to serve a growing segment of TV homes (with > 55’ screens)

10 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right content Number of UltraHD Channels*

 Over 800 Ultra HD channels within the next 10 years 900 800 800 CAGR predicted with a CAGR of almost 50%* 700 +50% 600  Growth mainly driven by North 500 America (40%), (17%) and 400 Western (14%) 300 200

 HTS will support 100

roll-out in selected regions, 0 notably in North America and

 Plus UHD user generated content Predicted Ultra HD Channel Growth and UHD-VOD

*Northern Sky Research, 2014 11 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

Number of UltraHD Channels The right content by platform*  With almost 70% of channels distributed via DTH platforms, 900 satellite will drive Ultra HD 800 roll-out* 700 600 Others 500 DTH  For 2015-16, already 12 Ultra 400 HD channels are expected 300 200 70%  About 60% of channels 100 broadcast via satellite will be 0 from North America, Europe and Asia Satellite to Drive Ultra HD Channel Growth

*Northern Sky Research, 2014 12 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right standards - UHD Phases Technology development of Ultra HD is ongoing

UHD-1 – 4K Phase 1 UHD-1 – 4K Phase 2 UHD-2 – 8K

 more pixels  better pixels  Super Hi-Vison  HEVC Main 10  Higher Dynamic Range  7680 x 4320 pixels  3840 x 2160 pixels (HDR)  e.g. by NHK  at 50/60 fps  at 100/120 fps  10-bit color depth  more colors  DVB standardized  better audio Now in EU by 2016-2017 in EU by 2020

Ultra HD is encoded in HEVC – High Efficiency Video Coding

 Current data rate via satellite is about 25 Mbit/s  with better encoders the bitrate can go down to 20 Mbit/s in 2015-2016  with HEVC bandwidth cost become affordable for broadcasters

13 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right standards - DIGITALEUROPE logo Logo Scope

UHD-TV Receiver Scope of DE UHD Display Logo T,S,C,IP UHD TV UHD Display Tuner Minimum conditions Interoperability established by this document DISPLAY  Resolution capable of rendering 3840x2160 through at least one path HDMI  Aspect Ratio 16:9  Colorimetry BT.709 UHD Source INTERFACES following DE Input  HDMI 2.0 with HDCP 2.2 accepts 50/60P (4:2:0) and specification 24P/25P/30P (4:2:2), 8-bit depth

AUDIO  2.0 Stereo PCM

more details: www.digitaleurope.org 14 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right equipment Production  Ultra HD cameras and encoders are available; although still at higher price levels

 Over 2000 UHD cameras units were shipped by April 2014

 Companies such as Ateme, dbw, Ericsson, Grass Valley, Hitachi, Panasonic IDC, SMARDTV, Sony, TOYS etc. are actively supporting the Ultra HD trials and productions

Home Equipment

 Ultra HD–HEVC chipset are available from several manufacturers

 Over 12000 UHDTV sets already shipped globally by CE manufacturers  such as Grundig, JVC, LG, Panasonic, Samsung, Sharp, Sony etc.  Forecasts revised upwards, x 2 in 2014

 First 4KTV STBs are coming to the market from different manufacturers  such as Arris, Cisco, Humax, Pace, Technicolor etc...

15 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right equipment - at home

UHDTV 1 2013 2014 2015 2016 (4k TV) Demo channels HEVC demo channels First commercial channels Quad HD (MPEG-4) up to (50/60 fps) (50/60 fps) HEVC (single tile) DTH channels via satellite

UHD TV sets HDMI 1.4 (30 fps) UHD TV sets with HDMI 2.0 (up to 60 fps)

TV sets with DVB-S2 & UHD TV sets with DVB-S2 & HEVC decoder (up to 60 fps) HEVC decoder

UHDTV HEVC UHD HEVC (30 fps) UHD HEVC STBs (50/ 60 fps) Set Top Boxes

Ultra HD Blu-ray Ultra HD Blu-ray players and discs (with HEVC + HDR) players

UHDTV UHDTV Consumer Camcorders (up to 30 fps) Camcorders

UHDTV UHDTV Game stations Game stations

16 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right equipment - at home - price trends  UHD screens saw a 36-41% price decrease between April 2013 and April 2014

FDH & UHD Price Comparison (EUR)

 The price comparison shows that UHD screens exhibit a similar price entry point and price decrease as Full HD screens did when first introduced

17 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right demand UHD Screen Sales per Region in 2020

 2/3rd of consumers would like to 12% have an UHD screen once they 39% have seen it 19%  Every 4th consumer would be ready to pay more for receiving High or Ultra High quality (Ericsson Consumer Lab 2013) 8%  55% of European consumers would buy U-HDTV (strategy 22% Analytics Consumer Metrix 2014) MEA APAC LATAM NAM EUROPE

* Source: GfK, IHB, Ericsson Consumer Lab, Strategy Analytics 2014 18 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right demand

“They look like 3D pictures.” “An amazing view of a scene that Italy, male, NPTV I felt I could touch, almost smell, feel. Really realistic. Made me want one of those TVs.” Female, NPTV ”You could see every detail, each drop, even ashes falling off the “It was a top quality picture, building, it’s all shown, faces of unbelievable, new technology.” the firemen. Slow motion is also Male, PTV a plus, it features all the details even better.” Poland, 41-65yo - PTV

“This must be 4K – already proposed by Sony and Samsung but no broadcasting available for “… I’d buy a 4K TV, but 4K the moment.” broadcasts will only be available Germany, PTV in 3 years!” Poland, 41-65yo - PTV

Eutelsat 4kTV Focus Groups – Q4-2014 19 MAXIMIZING QUALITY – WHAT IS NEEDED TO MAKE IT HAPPEN?

The right demand

 Still low unprompted consumer awareness of UHD, prompted awareness in WE at 64 %*  Consumers recognize the superior image quality versus SD and HD  Consumers are seduced by UHD but expect UHDTV to be a costly, premium product  Genre expectations include movies, series, documentaries and sport  Significant difference in markets maturity:  UK, Germany and Poland are ready to invest and subscribe  and Italy need more communication

Source: 4kTV Focus Groups – Q4-2014 * Source: Eutelsat TV observatory WE 2014 20 MAXIMIZING QUALITY – THE ROLE OF EUTELSAT SATELLITES

The right distribution - Status of Ultra HD per infrastructure  Satellite performance against terrestrial networks

BANDWIDTH COVERAGE IMAGE QUALITY TIMETABLE AVAILABILITY Satellite +++ +++ ++ +++ Cable + +++ ++ +++ DTT ++ +++ + + IPTV + ++ +++ + OTT ++ + +++ +

21 MAXIMIZING QUALITY – THE ROLE OF EUTELSAT SATELLITES

Eutelsat satellite play a crucial role for Ultra HD delivery globally

Ultra HD Ultra HD Ultra HD Ultra HD

OU/SNG Broadcaster Teleport Direct Direct Digital to home to cable terrestrial Ultra HD via Eutelsat satellite enables  Global distribution and local delivery of Ultra HD services  Immediate and cost efficient role-out of Ultra HD Broadcasting and Push-VOD services  Ubiquitous distribution of Ultra HD - anywhere within the footprint - in urban and rural areas  Direct (DTH) and indirect delivery (DTX – feeding and complementing of terrestrial networks)  De-congestion of terrestrial networks from bandwidth heavy applications (Ultra HD etc.)

22 MAXIMIZING QUALITY – THE ROLE OF EUTELSAT SATELLITES

 4K broadcast via Eutelsat satellites since January 2013

 With dedicated 4K demo channel(s)

 Full transmission chain in place DTH and DTX

 Eutelsat has the right bandwidth availability for 4KTV on global scale

 Eutelsat is partnering with key players along the value chain around the globe

 Eutelsat building a sustainable 4K eco-system

 Enabling growth in viewing experience and ARPU for its customers and audiences

MAXIMIZING QUALITY – THE ROLE OF EUTELSAT SATELLITES

 Eutelsat is driving 4KTV partnerships globally

Network Partners Device Partners Content Partners

24 MAXIMIZING QUALITY – CONCLUSIONS

Market forces team-up UHD Alliance for 4KTV mass market Members:

 DIRECTV  Dolby  LG  Netflix  Panasonic  Samsung  Sharp Corporation, Sony  Technicolor  Walt Disney Studios  Twentieth Century Fox  Warner Bros. Entertain.

The UHD Alliance is a global coalition of leading film studios, TV brands, content distributors, post-production and technology companies that aim to create a unified criterion for premium UHD, from devices to content including next generation features like as 4K resolution, High Dynamic Range, Wide Color Gamut, High Frame Rate and Immersive Audio.

25 MAXIMIZING QUALITY – CONCLUSIONS

UHDTV growth worldwide By 2025

By 2020  1000 UHD channels

 200 UHD channels  >500 mil UHD screens  100 mil UHD screens  400 mil HEVC STB’s installed  50 mil HEVC STB’s installed

UHD will become mass market in the next decade by 2025 half of all screens and STB’s sold will be UHD

* Source: GfK, IHB, Ericsson Consumer Lab, Strategy Analytics 2014 26 MAXIMIZING QUALITY – CONCLUSIONS

 Ultra HD availability is already much higher than what immediately comes to mind

 Ultra HD devices are already in the living environment and actively used

 Chinese manufacturers offer Ultra HD TV sets for less than US$1,000

 Film studios already produce massively Ultra HD content

 Ultra HD is in a much better position moving forward compared to the initial HD development life-cycle

 Eutelsat satellites are UHD ready and do already delivers Ultra HD direct-to-home and to other infrastructure (feeding and de-congesting)

27 VALUE CENTRIC INNOVATION OPTIMIZING DELIVERY

28 OPTIMIZING DELIVERY – MEETING CHANGING VIEWER EXPECTATIONS

Yesterday Today

 TV set  Any PC screen  Tablet 

 Catch-up TV Any  Video on Demand Time  Interactivity

Increased quality

29 OPTIMIZING DELIVERY – MULTICAST & MULTISCREEN VIA EUTELSAT

Satellite: up to 6Gbps guaranteed multicast Satellite advantages for multi-room usage  Up to 1000 TV channels per orbital position accessible on all screens End customer premise  Unlimited number of simultaneous TV screens  Constant highest quality standard, whatever the number of screens in the home

Deployed by most of Eutelsat’s clients

30 OPTIMIZING DELIVERY – HYBRID TV DELIVERY

How to address all the viewers Which IP devices are you addressing? expectations? (Broadcasters and DTH TV platforms) Challenges: Tablet or  74% Watch TV on a PC or tablet Smartphone  Long-tail catalogue for video on demand PC (website) 51%  …

Smart TVs 51% Reaction as of today:  To maintain user experience Game 20% excellence, most TV platforms consoles complemented their linear broadcast offer… Other 14%  … with new services based on broadband infrastructure (OTT) None 17%

Eutelsat online customer poll, November 2014, based on 37 responses 31 Answered: 35 Skipped: 2 OPTIMIZING DELIVERY – COMPENSATING OTT WEAKNESSES VIA SAT

Growing distribution costs Inability to reach the Lower quality of service, entire population especially at peak hour  CDN costs increase with the audience  Lower image quality …  Broadband networks saturated by OTT  … Or even no video demands service at all

OTT distribution cost pattern Broadband penetration bottleneck (2014) at peak hour Cost OTT Switzerland 94% France 92% Homes UK 86% Belgium 83% n x 2 to 20 Mbps Satellite Germany 71% Cabinet Russia 56% x Gbps / n homes Italy 55%  <1 Mbps per home Poland 55% at peak hour # viewers POP Turkey 44%

Source: iDate, Eutelsat analysis 32 OPTIMIZING DELIVERY – TV IS STILL PRIMARILY VIEWED AT HOME

 DTH continues to be the most efficient delivery means for TV at home

Location when using a tablet Tablet and TV usage pattern to access media along the day (% respondents, 2012-2013) (2013)

Out of home / at office

87% 87% At Home79% 79%

0am 6am noon 6pm Mid 2012 2013 night

Base: All Interactions Among Tablet Users (8591). Q. Were you... Note: Out-of-Home represents net of the following: on-the go, in-store, at work and somewhere else 33 Source: Google/TNS New multiscreen world 2012 2013 OPTIMIZING DELIVERY – COMPENSATING OTT WEAKNESSES VIA SAT

Growing distribution costs OTT distribution cost pattern  CDN costs increase with the Cost audience OTT Switching point  e.g. in 2013, BBC paid to satellite  30 M£ for streaming  12% of its distribution cost  2% of the audience Satellite  Increasing OTT subscriber base  Will cause congestion of terrestrial networks  Will lead to decrease in viewing experience and increase in cost # viewers

34 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

PAY TV FREE TO AIR PLATFORM BROADCASTERS   LIVE PROGRAMS CAS-to-DRM IP multicast SAT>IP

ON-DEMAND   Sat On-Demand HBBTV 2.0

35 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

Satellite-based multiscreen - live Broadband 2 alternatives Satellite Broadcast  CAS–to-DRM: bridge DVB and DRM securities  IP-multicast: broadcast over Subscriber satellite native IP streams home Main set-top-box routes DRM-protected streams to the IP devices in the home

Ethernet or Wifi Expected benefits TV  Flat-fee distribution platform Main STB Wifi  Maximum reach  Guaranteed quality of service

DRM Internet connexion server (ADSL, 3G or Smart LNB)

Source: Eutelsat 36 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

Existing OTT on-demand services Broadband Satellite Broadcast

DRM key, streamed content

browsing Broadband VoD servers  Catalogue Existing broadband

 Content VoD application Existing solution: OTT  web-server

Source: Eutelsat 37 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

Enhanced hybrid on-demand services Broadband

Satellite Broadcast ‘SAT On-Demand’

 Distribute via satellite, store locally contents pre-packaged for tablets/PCs, ready for immediate watching, … Push VoD server Most viewed broadcast Extension: content stored  … fully compatible with locally existing OTT VoD services: DRM key,  streamed content Same back-end (incl. DRM)  Same customer applications browsing  Access to long-tail catalogue Broadband through internet connection VoD servers  Catalogue Existing broadband (in lower quality)

 Content VoD application Existing solution: OTT  web-server

Source: Eutelsat 38 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

Open standard for advanced TV Growing adoption of the standard Current deployment 1.x Testing  CE manufacturers V2.0 to be deployed

 Broadcasters

HbbTV Association 39 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

Push-VoD benefits HbbTV benefits

Flat-fee distribution cost, Free-to-air broadcasters irrespective of the audience  Access push-VoD distribution model (standard feature of TV sets and set top boxes) Guaranteed quality of service Small pay TV platforms Broader reach of VoD service  CE economies of scale (100% population reachable)  No proprietary push-VoD technology to integrate HD or UHD services to all viewers (beyond broadband footprint) PushVOD

40 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

HbbTV Push-VoD is a reality  HbbTV 2.0 standard ready. Will be published by early 2015  1st end-to-end system demonstrated  Technology available to you !

Main partners

With Tested by IBC 2014: EUTELSAT presented the 1st implementation of hbbtv push-vod

41 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

OVERALL ARCHITECTURE OVERALL ARCHITECTURE WITH DSL CONNECTION WITH SMART LNB CONNECTION

42 OPTIMIZING DELIVERY – NEW SOLUTIONS FOR HYBRID TV DELIVERY

OVERALL ARCHITECTURE WITH DSL CONNECTION

Smart VOD HD  Cost effective & 100% coverage  Smart recommendation engine  1000’ s of titles  Improve customer’s stickiness Standard LNB + Sat GW + DSL (where available) High Quality Live Multiscreen  Cost effective & 100% coverage  Reuse already deployed technologies

4K-UHD ready  Compatible with 4K smart TV  Limited investment

One device supports all services  DSL connected where available  Use Smart LNB if connectivity not available Smart LNB + Sat GW : 100% territory

43 VALUE CENTRIC INNOVATION MAXIMIZING CONNECTIVITY Global Connectivity… …. Local Delivery.

44 MAXIMISING CONNECTIVITY - 4 PILLARS OF GLOBAL CONNECTIVITY

Global Fleet  34 satellites located on the geostationary arc between 117° West and 172° East  Connection 5 continents

Global Teleport Network  More than 40 owned and partner teleports – to access our satellites from any geographical location around the globe

Local Field Support  Over 10,400 trained installers - to support our customers launch and grow their networks

Local Account Management  19 Regional offices all over the World

45 MAXIMISING CONNECTIVITY - GLOBAL FLEET - COVERING 5 CONTINENTS

34 high power satellites - covering 99% of the world’s population

Global Connectivity ...

... Local Delivery

46 MAXIMIZING CONNECTIVITY – GLOBAL TELEPORT NETWORK

Own teleports…  In France (Rambouillet/), Italy (Turin and Cagliari), Madeira and Mexico (Iztapalapa and Hermosillo Sonora)  Highest technical and security standards  Video broadcast, content distribution and data services

ISO 27001 certifications for Rambouillet Teleport, ISO 9001 certification for all operations:  Rambouillet, Cagliari, Turin and Eutelsat Teleports

Network of certified and partner teleports  More than 40 teleports

Access to dedicated leased lines, PoPs & dark fibre

Portfolio of value-added ground services  directly and through teleport partners

47 MAXIMIZING CONNECTIVITY – GLOBAL TELEPORT NETWORK

CERTIFIED PARTNER AND PARTNER PROGRAMME

Certified Partner Teleports  Certified after an audit of their compliance according to our quality standards

 Must comply with the technical features and criteria we want to guarantee our customers

 Services can be integrated into a bundled solution for clients

Partner Teleports  Actively seeking as many partner teleports as possible

 That will invest in an uplink pointed to any of our satellites

 Must sign self-certification approval according to pre-defined technical specifications and quality standards

48 MAXIMIZING CONNECTIVITY – GLOBAL FIELD SUPPORT NETWORK

Training Campaigns  Satëlite  In field and online  On-line University  over 10,400 trained installers

Videos & online training tools  300,000 views of installer videos per year

Training apps  300,000 downloads of dedicated apps per year

49 MAXIMIZING CONNECTIVITY – GLOBAL FIELD SUPPORT NETWORK

Professional satellite installer - full VSAT installations

Trained, certified installer

Trained, certified DTH installers (“Satëlite” programme)

Also work with professional nationwide installation service companies and installer training schools

The KA-SAT Pointer app All our apps are The KA-SAT Finder app available from iTunes and Google The Eutelsat Finder app Play for free

50 MAXIMIZING CONNECTIVITY – LOCAL ACCOUNT MANAGEMENT

Regional offices in 19 countries, with techno commercial account management

Americas Europe

Mexico City, Mexico Cologne, Germany Miami, Florida, USA Istanbul, Turkey Rio de Janeiro, Brazil London, UK Tampa, Florida, USA Madrid, Spain Washington DC, USA Madeira, Portugal Moscow, Russia Asia Paris, France Beijing, China Rome, Italy Singapore Turin, Italy Warsaw, Poland Dubai, UAE Africa Jo’burg, South Africa

51 MAXIMIZING CONNECTIVITY – GLOBAL PARTNERSHIP

2012 Summer Olympics in London  Capacity on 4 Eutelsat satellites booked by broadcasters from Europe, the Middle East, Asia and South America to transmit live coverage of 300 events

Pope’s canonisation ceremony in HD  HD broadcast, uplinked by Globecast direct from St Peter’s Square to the satellite  Coordinated immediate redistribution across nine satellites to ensure global distribution

Retransmission of 2014 FIFA World Cup™ in 4k  Matches broadcast in 4k Ultra HD from Rio de Janeiro to Europe

– CASE STUDIES

52 Thank you MARKUS FRITZ, Director Commercial Development & Marketing www.eutelsat.com