2011 Latin America - Internet Market Research & Outlook

2011 Latin AmericaInternet Market Research & Outlook Latam 2010-2011 1

2011 Latin AmericaInternet Market Research & Outlook • Latin America: Rising Star of the Global Economy • Growing Internet Audience • Online Advertising: Booming Potential • E-commerce is Taking off • More Mobile Phones Than People • Latam’s Largest Market: Brazil • The Opportunity with U.S. Hispanics • Latam’s Online User’s Profile • Top Players in the Region 2

Latin America will continue growing at higherrates than developed economies Real GDP (annual % change) 20%Latam’s GDP growth for 2011-2012*: 15% • Argentina: 5% • Brazil: 4,3% 10% • Chile: 5,8% 5% • Colombia: 4,3% • Mexico: 4,1% 0% • G7 countries: 2,04% 2005 2006 2007 2008 2009 2010* 2011* 2012* • European Union: 1,7% -5% -10% Major advanced economies (G7) European Union China Argentina Brazil Chile Source: International Monetary Fund, Scotiabank Group 3

Top 14 Cities of Latam:All of them will climb in World GDP rankings 2010 GDP 2025 GDP GDP per Latam Current City (Country) World World Capita (by Rank Population Rank Rank city) 1 Sao Paulo (Brazil) 20.800.000 8 6 $18.654 2 Mexico City (Mexico) 22.800.000 9 7 $17.105 3 Buenos Aires (Argentina) 14.800.000 12 10 $24.459 Paris (6th) and Osaka (7th) will beovertaken in 2025 GDP by Mexico 4 Rio de Janeiro (Brazil) 12.500.000 30 24 $16.080 City and Sao Paulo. 5 Santiago (Chile) 6.050.000 51 50 $19.835 6 Brasilia (Brazil) 3.925.000 55 51 $28.025 Buenos Aires will overtake 7 Lima (Peru) 9.200.000 56 52 $11.848Boston (12th) and Washington DC (11th) by 2025 GDP. 8 Belo Horizonte (Brazil) 5.700.000 61 89 $10.702 9 Monterrey (Mexico) 4.350.000 63 58 $23.448 10 Bogota (Colombia) 8.850.000 64 61 $11.299 11 Porto Alegre (Brazil) 4.100.000 66 85 $16.098 12 Guadalajara (Mexico) 4.700.000 81 74 $17.234 13 Medellin (Colombia) 3.625.000 104 103 $13.793 14 Curitiba (Brazil) 3.300.000 113 112 $13.333 Source: PriceWaterhouseCoopers 4

Latam doubles the Worldwide growthrate of Online Population Online Population Growth 2009-2010 (%) 32% According to eMarketer, the number of internet users in Latin America has been increasing at about double the rate of population growth. 15% 8% 8% 6% 3% Middle East - Latin America Worldwide Europe Asia Pacific North America Africa Source: comScore 5

And Latam’s Online Populationis far from saturation Internet Penetration (%) 78.20% 77.30% Internet penetration in South America is still relatively small Online Populations of Latam will 42.80% boom with increasing internet 36.50% 36.20% penetration 31.60% 6.90% Japan United Russia South Brazil China India States America Source: Internet World Stats 6

Most major markets inLatam have grown significantly Audience growth in Latam 2009-2010 2009 Eric Schmidt 2010 40 (Google’s former CEO): 33.3 “..internet usage has increased dramatically [in Latin America]. In the last years, Brazil and Argentina are having the fastest 17.8 growth in the world. We are 14.8 looking forward to make strong 12.5 12.8 12.3 investments in both countries” 9.8 6.7 7.3 2.2 2.9 (April 2011 Interview – Diario Perfil) 1.1 1.2 Brazil Mexico Argentina Colombia Chile Venezuela Puerto Rico +20% +21% +3% +26% +9% +27% +9% Source: comScore 7

Latam’s Online Ads: in infant stages butwith booming potential Fastest-growing region in the world in online ad Latin America spending with a growth rate of 13.3% over the Online Advertising Spending Metrics, next five years. (Magna Global) 2009-2014 (billions, % of total and % change) Online ad spending will more than double over the 2009 2010 2011 2012 2013 2014 next four years, growing from $2 billion in 2010 to $4.2 billion in 2014. (eMarketer) Worldwide $ 55,2 $ 61,8 $ 68,7 $ 79,0 $ 87,4 $ 96,8 Latin $ 1,7 $ 2,0 $ 2,5 $ 3,1 $ 3,6 $ 4,2 America % of 3,0% 3,3% 3,6% 3,9% 4,1% 4,3% worldwide % change 13,3% 23,1% 21,2% 24,6% 16,2% 16,2% Source: eMarketer 8

Latam’s e-commerce is taking off... E-commerce in LatAm 1.20% Growing 51% per year during the 34.5 period 2003-2009 1.00% E-commerce as a % of GDP 27.6 0.80% US$ Billions 21.8 0.60% E-commerce has also grown in 15.6 importance: it has increased as a 0.40% 10.6 percentage of GDP at an average 7.5 rate of 34% per year. 4.9 0.20% 3 1.9 0.00% 2003 2004 2005 2006 2007 2008 2009 2010* 2011* Sales E-commerce as a % of GDP Source: :AmericaEconomia Intelligence 9

And it will continue growing By 2014, global e-commerce spending is projected to increase more than 90 percent. In Latin America, the amount spent online is projected to more than double. Source: Euromonitor International 10

E-commerce by country 1.3% It’s not a matter of size… 1.3% 2.0% 2.7% It’s about development 2.9% Brasil Mexico • Infrastructure 4.0% Chile 4.0% Venezuela • Technology adoption 4.2% Argentina Caribe sin PR • Supply of goods and services 4.7% Centro Am. 60.8% Puerto Rico • Buying patterns and cultures 12.1% Colombia Peru • Banking and credit card penetration Other Source: :AmericaEconomia Intelligence 11

E-commerce categories in Latin America Taxes, 2% C2C, 6% The travel category is still the most important in Latin America International Retail, 13% Travel The retail category is growing Travel, 45% Retail the most International Retail Paying taxes online has a high C2C Retail, 34% potential Taxes Source: :AmericaEconomia Intelligence 12

Credit Card Penetration Number of credit cards per 10 individuals 19Brazil is the clear leader, but it’sstill far behind penetration in 10developed countries Latams Leader 7 4-5 2 or less Colombia, Mexico and Argentina, Chile, Puerto Brazil Spain USA Other Rico, Uruguay Non-Latam countries Source: Fuente: Estudio Regional de Comercio Electrónico América Economía 2010 13

Latam: more mobile phones than people According to Informa Telecoms & Media, Latin America will reach more mobiles than people by the end of 1Q11 Prepaid represents over 80% Mobile Phone Users in Latin Mobile Phone User Penetration America 2009-2015 by Country, 2009-2015 90% 70.7% 72.9% 80% 66.2% 68.6% 60.6% 63.4% 57.3% 70% 432.7 450.7 396.2 415.6 354.6 375.5 60% 331.5 50% 40% 2009 2010 2011 2012 2013 2014 2015 2009 2010 2011 2012 2013 2014 2015 Mobile Phone Users Argentina Brazil Mexico Latin America Source: eMarketer Source: eMarketer 14

Latam’s largest market: Brazil Brazil: Internet Users and Total Visits 2,210 2,253 2,252 2,155 2,176 2,199 2,163 2,113 2,153 2,132 1,966 1,978 1,848 Brazil has nearly 40% of Latam’s Unique Visitors (MM) internet users Visits (MM) 38.7 39.3 40.0 37.5 38.1 It is the 8th largest 33.3 33.8 34.2 34.8 35.3 35.9 36.4 37.0 internet audience in the world (15+, H&W). Mexico is 16th and Argentina is 19th Unique visitors (MM) Visits (MM) Source: comScore 15

Brazil’s e-commerce Brazil’s e-commerce is expected to grow at a E-consumer evolution in Brazil compound annual growth rate (CAGR) of 18% over 11.3 the next five years. 9.4 According to Forrester Research, Brazilian e-commerce is set to jump to 178% by 2016. Millions of e-consumers 6.7 Billions of US$ Retail Sites Growth 5.2 27+ 4 23 +9% 2.8 17.6 +3% 69.6% 13.2 63.8% 63.9% 61.8% 9.5 7 Brazil Worldwide 2006 2007 2008 2009 2010 2011* 2009 Reach 2010 Reach E-consumers Sales Source: comScore Source: Camara Brasileira de Comercio Eletronico 16

Social Networking in Brazil The reach of the Social Networking category Twitter.com Top 15 Markets by continues to be very high throughout Latin America % Reach Brazil 22% In Brazil, even with such a high reach, the Netherlands 22% category is amazingly still growing: Venezuela 21% In October 2010, Brazil was Twitter’s #1 market Japan 20% Indonesia 19% Canada 15% Social Networking Sites Philippines 14% Growth Argentina 13% +10% Singapore 13% 85.3% +4% United Kingdom 13% 77.9% Turkey 13% 70.5% 67.6% United States 13% Chile 12% Mexico 11% Brazil Worldwide Colombia 10% 2009 Reach 2010 Reach Source: comScore Source: comScore 17

Hispanics in the U.S. 2010 Population U.S. Population (Millions) (by race, % of total) 4% 2% White non-hispanic 200.9 13% White non-hispanic Hispanic 49.7 Hispanic Black 39.9 16% Black Asian 65% Asian 14.4 Multi-racial Multi-racial 5.4 Source: U.S. Census Bureau Source: U.S. Census Bureau Hispanics are the 1st minority of the U.S. with an approx. population of 50 million That makes U.S. Hispanics the 2nd largest concentration of Hispanics in the world: only behind Mexico 18

Hispanics are a rapidly growing population… Projections of the Hispanic Population (Millions) 132.8 According to U.S. Census Bureau 120.2 projections, Hispanics will grow 108.2 167% (White Non-Hispanics will only grow 1%) from 2010 -2050, 96.8 across all ages. 85.9 75.8 66.4 It is also projected that by 2050, 57.7 Hispanics will account for 30% of 49.7 28% 30% the U.S. population. That’s almost 25% 27% 21% 23% double from their current 18% 19% 16% percentage 2010 2015 2020 2025 2030 2035 2040 2045 2050 Numer of hispanics in millions % of total population Source: U.S. Census Bureau 19

With More Buying Power Hispanic Buying Power (in billions) 1,330 Hispanics’ percentage of +36% buying power is expected to 978 double in the period of 1990- 2014 +100% That’s twice to growth in 489 percentage of non-Hispanics +130% In comparison, Brazilian’s 212 buying power for 2009-2014 9.1% 10.2% will grow over 30% 5.0% 6.8% 1990 2000 2009 2014 Buying power in billions % of total buying power Source: Selig Center for Economic Growth, University of Georgia, International Monetary Fund 20

Compared to non-Hispanics,Hispanic adult Internet users… ...are younger: • On average, 8 years younger Larger households • Twice as likely to be 18-24 with more kids and • 50% more likely to be 25-35 employed adults …live in larger households: • On average, 1 person more per household (4 vs. 2.9) • 3x as likely to live in 5+ households ...are twice as likely to live in households with 3 or more children, and Attractive Audience ...are 77% more likely to live in households with 3 or more employed adults Source: Simmons NCS. Leading sources used: Interactive Advertising Bureau 21

Latam’s Online User’s Profile Brazil has the largest online Total hours online per Visitor in Latin population in Latin America America Worldwide Average: 22.4 Brazil 24.3 – 45.1 million is currently the comScore estimate of 6+, Mexico 24.1 home & work Argentina 25 – Extended universe estimate Colombia 20.1 is 77.3 million, larger than the total populations of Chile 22.8 France and the UK (66 and 62 million, respectively) Peru 24.7 Average usage in Brazil, Venezuela 19.8 Mexico, Argentina, Chile and Puerto Rico 17.1 Peru outpace global average Source: comScore 22

Young People Drive InternetConsumption in Latin America Average Time Online by Age Hours per Visitor 30 15-24 year olds in Latin 26.6 worldwide average: 22.6 America are the heaviest 25 23 22.8 24.2 23.2 22.4 21.9 22.4 Internet users, outpacing 20.8 21.3 21.2 21.8 every other age group in 20 Latin America as well as the 15 global average for the age group 10 5 0 15+ 15-24 25-34 35-44 45-54 55+ Latin America Worldwide Source: comScore 23

Social Networks Reached 88% ofLatin American Internet Users Twitter.com Top 15 Markets by % Reach Brazil 22% Netherlands 22% Social Networks continue to be a central Venezuela Japan 21% 20% touch point of the Latin American web Indonesia Canada 15% 19% experience Philippines Argentina 14% 13% Singapore 13% United… 13% Turkey 13% United States 13% Chile 12% Mexico 11% Social Networking Sites Growth Colombia 10% Source: comScore +7% Facebook.com Top 15 Markets by % Reach 87.7% 82.2% Philippines 93.7% +4% Turkey 90.7% Israel 90.2% 70.5% Chile 89.5% 67.6% Malaysia 88.4% Argentina 88.3% Venezuela 87.8% Indonesia 87.4% Canada 86.9% Colombia 86.7% Peru 83.4% Latin America Worldwide Mexico 82.6% United Kingdom 81.4% Puerto Rico 81.4% Dec 2009 Reach Dec 2010 Reach Finland 81.2% Source: comScore Source: comScore 24

Instant Messengers, Social Networking,and Blogs are Key in LatAm Reach of Key Categories Search/Navigation Index: 104 88% 85% News/Information 94 57% 60% Social Networking 124 70% 88% Technolgy 106 56% 53% e-mail 121 63% 76% Downloads 97 55% 57% Multimedia 106 71% 67% Games 103 53% 51% Instant Messengers 196 35% 68% Business/Finance 78 35% 46% Photos 125 53% 66% Education 121 29% 35% Directories/Resources 94 64% 68% Sports 99 31% 32% Blogs 126 50% 63% TV 93 31% 33% Retail 97 62% 64% Travel 76 22% 30% Community 104 60% 58% Automotive 76 18% 24% Latin America Worldwide Latin America Worldwide Source: comScore 25

Group-buying Sites ShowedImpressive Growth in Late 2010 Group-buying sites have taken off in Groupon Top Markets by % Reach Latin America and, based on what has been seen in the USA, are set to Argentina 21% continue their growth in 2011 Norway 12% Argentina is Groupon’s top market, with one of every five web users Poland 10% visiting the coupon site in February 2011. Brazil is also one of top Taiwan 9% markets with 6% reach Spain 7% United Kingdom 6% Italy 6% France 6% Brazil 6% Ireland 5% Source: comScore 26

Top Players in the Region Largest Online Commerce Platform in Latin America • IPO in August 2007 - $3.81 billion Market Cap (April 14th, 2011) • 2010: Revenues US$217 million – EBITDA $75 million • Stock performance (last 24 months): +300.69% (vs. Nasdaq: +66.43%) Largest Shopping Comparison Website in Latin America • Acquired by Naspers in September 2009 for $374 million • More than 15 million products sold on over 60 thousand stores Leading Provider of Online Classifieds in Latin America and Asia • Over 125 million unique visitors per month, presence in 90 countries in 40 languages • Naspers bought a controlling stake in August 2010 for approximately $200 million Pioneer and Leader in Collective Purchases in Brazil • In nine months it registered over 5 million users and sold more than 2 million vouchers, generating savings of over $ 120 million to its users • Received funding from Benchmark Capital and Monashees Capital (undisclosed amount) 27

Top Players in the Region (cont.) Leading Job Portal in Latam • Acquired by Tiger Global in July 2007 for $15 million • $1 million EBITDA when acquired Leading Travel Portal in Latam • Over $125 million sales in 2007 • Has raised over $60 million in funding Leading Social Gaming Company in Brazil • Over 20 million active players a month • Has raised over $46 million in funding Leading Spanish/Portuguese social networking site • Over 50 million registered users • Raised over $6 million in funding 28

Gustavo Victorica Federico Yu CFO Finance Analystgustavo.victorica@fnbox.com federico.yu@fnbox.com For more information visit: http://www.fnbox.com

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