Media Landscape and the Rise of Digital Media

06/06/09 Media landscape

Media Expenditure, 1987-2007 (£m) Source: Advertising Association Note: Internet spend consists of display, paid search and classified

Media Expenditure, 1960-2007 (£m) Source: Advertising Association Note: Internet spend consists of display, paid search and classified

Media Expenditure at current prices, 1960-2007 Source: Advertising Association

Media Expenditure at constant prices, 1960-2007 Source: Advertising Association

Number of Commercial TV channels

Number of radio stations, 1973-2007 Source: RAB Note: Analogue radio stations

Cinema Admissions, 1992-2008 Source: CAA/Nielsen EDI

Media Fragmentation Source: BRAD

Unique Visitors to Leading Social Media Sites Source: Comscore

All social networks have grown in recent years There is cross pollination with Social Networks Many people have a Myspace, Bebo and Facebook account But YouTube’s unique position as a social and video site has meant that YouTube has become the default platform for sharing and viewing videos

There is cross pollination with Social Networks

Many people have a Myspace, Bebo and Facebook account

But YouTube’s unique position as a social and video site has meant that YouTube has become the default platform for sharing and viewing videos

Future Consumer will be Digital Focused Ave. hours/week % media consumption Print Internet Analogue TV Digital TV Analogue radio Cinema Outdoor Wireless Games 0 10 20 30 40 50 60 70 80 90 100 1900 1920 1940 1960 1980 2000 2020 2006 Source: OFCOM 50% of all media by 2007 66% of all media by 2010 80% of all media by 2020

06/06/09 Digital landscape

Online usage has become part of everyday life 32m people online in the UK 6.8m are 15 to 24yrs 21% of online population 4.7m 15 to 24yrs ABC1 Average 31 minutes online 2m 15 to 24yrs C2DE Average 35 minutes online Source; ComScore Sept 2008

32m people online in the UK

6.8m are 15 to 24yrs

21% of online population

4.7m 15 to 24yrs ABC1

Average 31 minutes online

2m 15 to 24yrs C2DE

Average 35 minutes online

1st internet ad AT&T in their "you will" campaign from 1994 Netscape was the first internet browser, launched in 1994

AT&T in their "you will" campaign from 1994

Netscape was the first internet browser, launched in 1994

2002 UK internet access reached 50%

2007 UK broadband penetration surpassed 50% due to triple play services (mobile, broadband & phone)

Currently 21 million digital TV households

2006 mobile phone penetration reached 90%

USB mobile broadband is still relatively low at 6.9% but set to grow with mobile operators offering free laptops with mobile broadband contracts

2004 Halo 2 made more money on its first weekend of release than Titanic World of Warcraft was first released in 1994 and is the largest Massively Multiplayer Online Role Playing Game with over 11 million registered players worldwide Online gamers on average spend 15 hours gaming per week 2008 Grand Theft Auto IV broke industry records with sales of around 3.6 million units on its first day of release and grossing more than $500 million in revenue in the first week, from an estimated 6 million units sold worldwide

World of Warcraft was first released in 1994 and is the largest Massively Multiplayer Online Role Playing Game with over 11 million registered players worldwide

Online gamers on average spend 15 hours gaming per week

2008 Grand Theft Auto IV broke industry records with sales of around 3.6 million units on its first day of release and grossing more than $500 million in revenue in the first week, from an estimated 6 million units sold worldwide

BBC iPlayer largest audience 17million Internet TV IPTV Web TV “ Click n’ watch” Pre-downloads TV screen To PC screen

Catch up TV is breaking the barrier between video entertainment & the internet as a communications or shopping tool The Beijing Olympics was the tipping point for BBC iPlayer with a broader demographic profile using the online service Consumers are responding to this increased supply 27% of those aged 15-24 claim to use the internet for ‘watching TV programmes’ in 2008, up by 17 percentage points in 12 months 45% used it for ‘watching video clips/webcasts’, also up by 18 percentage points over the same period. Source; Ofcom

The Beijing Olympics was the tipping point for BBC iPlayer with a broader demographic profile using the online service

Consumers are responding to this increased supply

27% of those aged 15-24 claim to use the internet for ‘watching TV programmes’ in 2008, up by 17 percentage points in 12 months

45% used it for ‘watching video clips/webcasts’, also up by 18 percentage points over the same period.

Breakdown of UK YouTube traffic UK users are re-directed to a sub-domain of YouTube.com US users are able to search UK content within the main YouTube.com domain UK YouTube content viewed by US users varies case by case But the average is 30% Campaign Reach 670,977 users reached 30% viewed by US users 469,683 UK users 9.8% of 15 to 20 year olds reached Source: Hitwise, July/August 2007

UK users are re-directed to a sub-domain of YouTube.com

US users are able to search UK content within the main YouTube.com domain

UK YouTube content viewed by US users varies case by case

But the average is 30%

Campaign Reach

670,977 users reached

30% viewed by US users

469,683 UK users

9.8% of 15 to 20 year olds reached

Cost of targeting young people through traditional online media Targeted media on YouTube Targeting UK 16 to 24yrs year olds CPM of £4 CPM on YouTube Impressions required 19,125,000 2.45% interaction rate* 469,683 users interaction Media Cost - £76,500 Standard targeted display media Targeting UK 15 to 21yrs year olds CPM of £5 CPM on Hotmail, Facebook Impressions required 19,200,000 2.45% interaction rate* 470,000 users interaction Media Cost - £96,000 *Source: DoubleClick Creative Insight on Rich Media Sept 2008

Targeted media on YouTube

Targeting UK 16 to 24yrs year olds

CPM of £4 CPM on YouTube

Impressions required 19,125,000

2.45% interaction rate*

469,683 users interaction

Media Cost - £76,500

Standard targeted display media

Targeting UK 15 to 21yrs year olds

CPM of £5 CPM on Hotmail, Facebook

Impressions required 19,200,000

2.45% interaction rate*

470,000 users interaction

Media Cost - £96,000