ComScore - State of the internet - Brazil

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Data Sourced From comScore’s Global Panel of 2MM Internet Users Worldwide A Global Measurement of Audience and e-Commerce ° 360° View of Consumer Behavior Web Visiting and Viewing Demographics Online Life Stages Transactions Streaming Search Video Behavior 37 Individually Reported Countries Media 172 Countries with Sample Presence Exposure Proprietary and Confidential Do not distribute without written permission from comScore 2

1,100 + Blue Chip Clients Internet Agencies Telecom Financial Retail Travel CPG Pharma Technology Proprietary and Confidential Do not distribute without written permission from comScore 3

Strong Track Record of Innovation to Provide Behavioral Ad Effectiveness (Campaign Metrix) Video Streaming Measurement (Video Metrix) to Deliver a Worldwide Internet Audience Measurement (World Metrix) to Measure the Search Market (qSearch) to Build and Project from 2M+ Longitudinal Panel to Monitor and Report eCommerce Data External Recognition WORLD ECONOMIC Top 100 World’s Largest FORUM Innovative Companies Windows Database Technology December 2004 December 2001, Pioneer 2003, 2005 2007 Proprietary and Confidential Do not distribute without written permission from comScore 4

The US Now Accounts For Less Than a Fifth of the Worldwide Internet Population ■ Twelve years ago in 1996, two-thirds of the world’s online population was in the U.S. Regional Distribution of Online Population by Geography World Online Population YOY Rest of the Growth World 34% 83% Non-U.S. +12.4% United 66% States ` U.S. 17% +3.4% 1996 2008 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 5

Latin America continues growth ■ Growth has slowed in North America and Worldwide Online Population Europe Millions of +10.6% Internet Users ■ Asia Pacific continues to show strong 778.3 860.5 growth on a large base ■ Latin America and the Middle East/Africa are now the high-growth regions globally June 2007 Worldwide June 2008 Online Populations by Region Millions of Internet Users +14.0% 326.8 286.7 +8.0% +3.6% 223.9 241.8 178.4 184.7 +18.1% +22.8% 53.7 63.4 35.6 43.7 Asia Pacific Europe North America Latin America Middle East - Africa Source: comScore World Metrix, June 2008 Proprietary and Confidential Do not distribute without written permission from comScore 6

Brazil is largest and fastest-growing in the region ■ Brazil has, by far, the largest online population in the region, and continues to grow at a rapid rate – YOY growth was 27% ■ Brazil has the heaviest users in the region, outpacing the worldwide average Internet Users (MM) Total Online Hours per Visitor in Latin America Latin America WW Avg: 22.4 Brazil 26.2 58.3 Brazil 26.8 Mexico 12.2 Mexico 23.3 Argentina 9.1 Extended Universe Argentina 25.9 estimate, including users under 15 or Chile 5.5 using shared Chile 22.0 computers Colombia 3.6 Colombia 23.0 Venezuela 1.7 Venezuela 22.9 Puerto Rico 0.9 Puerto Rico 15.8 Internet users ages 15+ accessing the internet from a Home or Work computer Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 7

Comparison to Other Countries Outside Region ■ 15+ Home and Work populations in India, Russia, and Korea are roughly the same size ■ Brazil’s usage is among the heaviest in the world: only a few other countries spend more time online per user than Brazil Internet Users (MM) Total Online Hours per Visitor WW Avg: 22.4 Brazil 26.2 58.3 Brazil 26.8 China 168.3 254.3 China 18.6 India 30.7 46.1 India 10.5 Russian Federation 27.4 Russian Federation 14.7 South Korea 26.7 Extended Universe South Korea 21.9 estimates for Brazil, China & India, Italy 20.2 including users Italy 18.4 under 15 or using shared computers Spain 17.1 Spain 23.0 Internet users ages 15+ accessing the internet from a Home or Work computer Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 8

Brazilians show strong preference for local content Total ■ Nine of the top 20 Internet properties Unique % Reach in Top Properties in Brazil Key Sites are Brazilian, and an additional 5 are Visitors (000) Brazil Latin American or Portuguese sites Total Internet : Total Audience 26,221 100.0 Google Sites Google Search, Orkut 23,755 90.6 ■ Google, the #1 property in Brazil, Microsoft Sites Windows Live Messenger, Windows Live Hotmail 22,718 86.6 draws its popularity from its search UOL Sites UOL.COM.BR 18,294 69.8 Organizacoes Globo Globo.com, Globo Videos 15,448 58.9 engine and Orkut, while Microsoft Terra Networks Terra Brasil 14,594 55.7 traffic is driven by MSN Live Grupo Brasil Telecom iG.com Yahoo! Answers, 14,012 53.4 Yahoo! Sites 13,912 53.1 Messenger. Both benefit from Homepages, Search MercadoLibre MERCADOLIVRE.COM.BR 10,909 41.6 localized content versions and a Wikimedia Foundation Sites Portuguese Wikipedia 8,546 32.6 Submarino, strong Brazilian version of the brand. Lojas Americanas AMERICANAS.COM 8,095 30.9 WordPress 7,119 27.2 Continued success depends on their BuscaPé Inc. BUSCAPE.COM.BR 4,780 18.2 ability to diversify and provide other Grupo Abril Oi - Grupo Telemar ABRIL.COM.BR OI.COM.BR 4,491 3,572 17.1 13.6 offerings that cater to the Brazilian Adobe Sites 3,480 13.3 CAIXA.GOV.BR 3,384 12.9 audience Portugal Telecom Sapo.pt 3,258 12.4 Grupo Carso Claro Sites 3,183 12.1 SP.GOV.BR 3,182 12.1 Batanga SONICO.COM 3,137 12.0 Proprietary and Confidential Do not distribute without written permission from comScore 9

Brazilians, Like Audiences Worldwide, Prefer to Consume Content in their Native Language Distribution of Pages Viewed by Language Puerto Rico Venezuela Mexico Colombia Argentina Chile Brazil Source: comScore Custom Analysis of Page Views by Language, February 2008 Proprietary and Confidential Do not distribute without written permission from comScore 10

Traffic to Top Brazilian Sites from Outside Brazil ■ The combined unduplicated audience of the Top 4 Brazilian sites draws a third of its audience from outside the country ■ Besides their shared language, Portuguese Internet users may also view Brazilian content in order to supplement the variety of publisher offerings at home ■ Large Brazilian expat communities in a number of countries (particularly in neighboring Argentina and in Japan) also make up a substantial part of these sites’ Worldwide audience. Brazilians are loyal to their local language content no matter where they may be in the world Source of Traffic to Top 4 Brazilian Sites Total Unique Visitors World-Wide 32,209 Brazil 21,626 Portugal 1,512 Argentina 973 Japan 694 United States 589 Spain 346 Mexico 215 Italy 278 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 11

How the World Uses the Internet Average Internet Growth = 10.6% “On-ramp” categories Everyone uses it: High Reach, - Portals Flat Growth - Search Global Reach Utility & Content - Entertainment Approaching Mainstream, - Multimedia High Growth - Email & IM - Gaming - Retail - Business/Finance Mainstream, Web 2.0 - General News MidReach, Growing Reach, - Travel Flat Growth Very Fast Growth - Social Networks - Sports Web 2.0 - Blogs - Auto “Casualties” - Photos - Reference Low Reach, - Community - Extended Web Negative Growth - Personals - Retail Movies - Retail Music Category Growth Source: comScore World Metrix, June 2008 Proprietary and Confidential Do not distribute without written permission from comScore 12

Key Categories in Brazil cluster around Communications, Networking, Entertainment 250 ■ Brazilians are FAR more likely to use Social Networks and Blogs than the average global Internet user. This Consumer generates concomitant above-average 200 Electronics Government usage of Extended Web technologies (widgets) Entertainment - IMs ■ Communication is key: Instant Index to WW Reach News 150 Messengers and E-Mail continue to be Extended Web popular Social Blogs Networking ■ Entertainment sites in general are Multimedia e-mail 100 Retail popular, but Entertainment News 0.0 20.0 40.0 60.0 80.0 100.0 visitation in Brazil is above average ■ Brazilians’ love of shopping reflected in 50 above average visiting to Retail sites, particularly Consumer Electronics ■ High index for Government sites driven by Caixa, e-Government at state level 0 Brazil Reach Brasil Reach Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 13

Social Networking in Brazil Dominated by Orkut ■ The full category reaches 84.3% of the Brazilian audience, one of the highest rates in the world for Social Network visiting ■ Orkut is THE primary Social Network in Brazil – both reach and usage metrics outstrip all others Social Networking Sites in Brazil % Reach Minutes per Visitor Visits per Visitor Orkut 79.1 496.1 28.3 Yahoo! Geocities 14.9 2.8 1.8 SONICO.COM 11.4 10.1 2.7 FOTOLOG.COM 6.1 22.1 5.3 8P.COM.BR 5.6 11.2 1.9 MULTIPLY.COM 4.5 4.4 1.5 HI5.COM 4.4 10.6 2.0 MYSPACE.COM 3.4 13.2 2.3 FACEBOOK.COM 1.4 14.2 2.7 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 14

Social Networking is Highly Localized ■ Now that Social Networking has generally become mainstream, emerging markets, particularly, tend to “choose” a primary provider ■ Facebook leads in most of the Lat Am countries: ■ Brazil accounts for nearly half Argentina: Facebook, 28% of audience of Orkut’s global traffic Chile: Facebook, 67.7% of audience % of Unique Visitors Distribution of Orkut Traffic Colombia: Facebook, 60.2% of audience Mexico: Sonico.com, 22.1% of audience Rest of the PR: Facebook, 47.2% of audience World, 20% Venezuela: Facebook, 49.4% of audience Brazil,48% ■ Friendster has strongholds in Southeast Asia; other country-dominant sites include Mixi in India,27% Japan and CyWorld in South Korea Rest of Latin America, 5% 15 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore

The ‘Halo Effect’ in Social Networking ■ Orkut’s 79.1% reach in Brazil indicates a high degree of comfort w/ the Social Network concept, more so than in other countries ■ This extends to increased usage of sites incorporating the SN concept ■ Photo sites Fotolog, Flickr, Picasaweb, Bubome Most visitors to these sites are also Orkut users ■ Video sites Youtube, Globo Videos ■ The ‘high switching cost’ associated with Social Networks really applies more to SNs that don’t offer anything substantially beyond the core services already provided by Orkut ■ Sonico reached 11.4% of the Brazilian audience in September, compared to Orkut’s 79.1%, but more critically, 94% of Sonico visitors also visited Orkut ■ Global leader FaceBook is not even a player in this market, despite Brazilian Portuguese version Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 16

Widget Publishers & Platforms ■ 7th highest Extended Web (Widget) penetration rate globally, unsurprising given popularity of Social Networks and Blogs in Brazil ■ Reflects Brazilian (and Latin American) publishers’ comfort level with Widgets Extended Web Reach % of Online Population 66.7 65.1 59.8 57.3 55.6 54.6 51.9 51.5 49.8 48.2 39.6 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 17

Search Intensity Comparison ■ Countries with similarly-sized Searcher populations include developed Internet economies and very large developing markets ■ Brazil’s search intensity aligns more closely with France, Italy, Korea than Russia or India Search Population & Intensity Total Searchers (MM) Searches per Searcher France 26,213 France 106.3 Russian Federation 23,348 Russian Federation 63.0 India 22,931 India 51.0 Korea 21,072 Korea 109.3 Brazil 20,917 Brazil 106.5 Canada 20,265 Canada 122.5 Italy 17,683 Italy 105.8 Spain 14,638 Spain 96.5 Source: comScore qSearch, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 18

Search is Dominated by Google ■ Generally heavy search activity in Latin ■ 89% of all online searches in Brazil are on America Google ■ Brazilian users average 106.5 searches ■ UOL Sites and iG.com rank a distant second and per searcher third after Google (with <2% share each), and all others make up the remaining 6%, the largest Search Intensity among them including Yahoo, Microsoft, Terra, Searches per Searcher and Ask.com Brazil 106.5 Mexico 106.8 Google Share of Searches Latin America Brazil Argentina 93.9 Chile 93% Chile 97.7 Venezuela 93% UOL Sites,2% Colombia 91% iG.com, 2% Colombia 109.4 Argentina 89% All Others,6% Google Sites, Brazil 89% 89% Venezuela 98.7 Mexico 88% Puerto Rico 57% Puerto Rico 62.4 Source: comScore qSearch, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 19

Online Entertainment in Brazil ■ Multimedia sites lead amongst Entertainment subcategories both in terms of reach and usage ■ Heaviest users are in Multimedia and Kids categories ■ Repeat visiting indicates high interest in the category Entertainment Visiting & Engagement % Reach Minutes per Visitor Visits per Visitor Entertainment- Full Category 79.0 104.8 14.5 Multimedia 68.7 73.0 9.9 Entertainment- Music 42.7 10.0 3.6 TV 32.1 18.9 4.6 Entertainment- News 24.6 14.0 4.5 Radio 22.6 17.8 2.8 Kids 18.5 56.8 4.2 Entertainment- Movies 12.4 5.8 2.2 Humor 5.5 4.1 1.6 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 20

Clear Appetite for Multimedia, especially Video th Multimedia Sites ■ Brazil ranks 14 out of 37 countries in terms of % Reach average visits to multimedia sites each month YOUTUBE.COM 47.5 Globo Videos 40.7 ■ Globo Videos reached 41% of Brazilian online WindowsMedia 14.3 population in September, YouTube.com MSN Music 8.4 reached 48% MSN Video 8.3 ■ YouTube’s reach of the audience increased by Real.com Network 5.9 26% since Oct 07; Globo Videos has grown an STARTVG.COM 5.1 WinAmp (App) 4.9 even faster 58% 4DH.COM 4.7 ■ Low broadband penetration rates limit iTunes Software (App) 2.8 engagement and audience Growth in Site Reach 47.5 37.7 40.7 25.7 +26% +58% YOUTUBE.COM Globo Videos Oct-2007 Sep-2008 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore

IM is Highly Popular in the Region ■ Instant Messenger Usage in Latin America is the highest in the world; Brazil is a close second after Argentina in terms of IM reach of the online audience ■ Windows Live Messenger almost exclusively drives the usage in the category Countries with Highest Top Instant Messengers IM Reach in Brazil % Reach % Reach WW average: 49.8 Argentina 78.9 MSN-Windows Live Messenger 76.8 Brazil 78.1 TWITTER.COM 9.1 Venezuela 77.1 Meebo, Inc 1.7 Colombia 76.4 eBuddy Sites 1.4 Mexico 73.6 PLUGOO.COM 1.3 Chile 71.9 Yahoo! Messenger 1.2 Spain 66.1 Google Talk (App) 0.5 Canada 65.9 IMINENT.COM 0.3 Portugal 65.8 WEBMESSENGER.COM.BR 0.2 Singapore 63.6 Skype Instant Messenger (App) 0.2 Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 22

eCommerce is Taking Hold in Brazil ■ Brazil makes up 37% of the Latin American online population but made up 58% of e- Commerce dollars in 1st half 2008 ■ Brazil shops close to home: 95% of online dollars were spent on Latin American sites ■ Brazilian buyer penetration 7% in Q2 2008 but ten times as many Brazilian internet users visited a Retail site over the same time period Users vs. $$ Site Purchasing Shopping Activity Latin American % Share Share of Dollars % of Brazilian Audience Source: comScore World Metrix , comScore Marketing Solutions Custom Research, Q2 2008 Proprietary and Confidential Do not distribute without written permission from comScore 23

Top Retail Sites in Brazil ■ Consumer Electronics and Comparison Shopping sites are the largest Retail categories in the country, and Brazilians visit those types of sites at a much heavier rate than the worldwide average ■ Top sites are Comparison Brazil vs. WW Average Shopping sites and Multi-Channel Retail Category Reach retailers Consumer Electronics 16.8 33.9 Top Retail Sites 30.8 in Brazil Comparison Shopping 27.5 % Reach Books 13.0 24.1 MercadoLibre 41.6 Computer Software 11.9 10.0 Lojas Americanas 30.9 Computer Hardware 11.2 BuscaPé.com Inc. 18.2 23.3 7.3 MAGAZINELUIZA.COM.BR 5.5 Department Stores 9.1 UOL Brasil Shopping 5.0 Sports/Outdoor 5.8 5.7 BONDFARO.COM 4.9 Retail - Music 5.3 8.7 Apple Inc. 4.7 Toys 5.1 LIVRARIASARAIVA.COM.BR 4.5 4.4 eBay 3.9 Apparel 4.7 17.2 EXTRA.COM.BR 3.7 Brazil WW Average Source: comScore World Metrix, September 2008 Proprietary and Confidential Do not distribute without written permission from comScore 24

Summary of Key Findings ■ Since 1996, the proportions have shifted: in 96, two-thirds of the world’s online population was in the United States; now, the U.S. accounts for only 20% of worldwide users ■ Brazil has the largest and fastest-growing online population in an important emerging region ■ Though Google and MSN lead the Top Properties rankings by virtue of specific offerings that have caught on in Brazil, there are a slew of local providers poised to take share and Brazilians vastly prefer to consume local content ■ It can’t be denied: Orkut is a phenomenon – Its influence extends beyond “pure” social networks and into categories where a SN-type community is brought to play – Along with the Google Search engine, has made Brazil a stronghold for the brand ■ Low home BB penetration impedes a great deal of high-bandwidth activity, such as video streaming, music downloads, etc, but it is clear that the desire/interest is there – a huge opportunity for players in these categories as BB penetration grows ■ 7 of every 10 users in Brazil visit Retail sites, and consumers are becoming more comfortable with purchasing online Proprietary and Confidential Do not distribute without written permission from comScore 25

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ComScore - State of the internet - Brazil

by Diego Gomes on Nov 27, 2008

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ComScore - State of the internet - Brazil — Presentation Transcript