Q1 2015 Digital Video Report
Adobe Digital Index

Table of contents Driven by
an increase in the number of connected TV devices (Roku, Apple TV, X-Box One, and Smart TV's) given as gifts during the 2014 holiday season, the first quarter of 2015 continued the record breaking trend of viewers watching video content on devices plugged in to the Internet. Video viewing behaviors shifted in year-over-year (YoY) terms and varied depending on the type of content being viewed; which ranged from free video clips supported primarily by advertising (Online Video) to premium shows accessed through an authenticated app- based or TV subscription service (TV Everywhere). This report covers both the established and the evolving trends within the digital video viewing space. It aims to provide insightful viewpoints for content providers, consumers, and advertisers. ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report Online Video 3 Key Insights 4 Online video viewing frequency 5 Device type share of online video starts 6 Device specific share of online video starts 7 Apple share of online video starts 8 Media and entertainment site video viewing 9 Online video ad viewing ratio growth TV Everywhere 10 Authenticated video growth by share of access type 11 Active monthly TV Eveywhere share of Pay-TV viewers 12 TV Everywhere share of authentications by access type 13 TV Everywhere share of authentications by device type 14 TV Everywhere daily viewing behaviors 15 Video viewing frequency growth by access type Appendix 16 Methodology 17 Glossary 18 Tables

Key insights Online Video •
Apple extends its dominance in mobile video viewing accounting for 4 out of 5 mobile online video starts - Fueled by the larger screen iPhone 6 and 6+, the share of video starts on an iPhone went up YoY; iPad share of starts was essentially unchanged during the same period • The tablet develops its niche as the leisure device - Video viewing frequencies on tablets are just as high as those on desktops, supporting the notion that the primary use-case for the tablet is leisurely activities like video viewing and web browsing • Ad viewing ratio increases on mobile devices - With viewing behaviors becoming more mobile, advertisers see an increase in the ratio of ad starts-to-video starts TV Everywhere • TV Everywhere viewing continues its climb higher - In a quarter that was not highlighted by a unique landmark sporting event, the number of TV Everywhere authenticated video starts continued to grow at impressive triple digit YoY figures • Apple TV helps bring digital video back into the living room - 1 in 4 authenticated streams now originates from a connected TV device; up from 1 in 20 a year ago • Consumers redefine "Primetime" - Wednesday has the highest share of TV Everywhere viewing while Friday accounted for the highest rate of binge viewing 3ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report

ONLINE VIDEO Online video viewing
frequency Larger screens are helping to close the gap in video viewing frequencybetween mobile devices and desktops. Findings: • The number of online videos viewed per visitor on smartphone devices was up 22% YoY • Tablet views per visitor are now just as frequent as desktop views per visitor • Desktop viewing frequencies of long form content (content on broadcaster sites) are almost 2x that of tablets; 4x smartphones 4 Insight: As devices become increasingly specialized, it appears as if a major use-case for the tablet is leisure derived activities like video viewing. As we can see in the data the viewing frequency of long form content on desktop devices still eclipses tablet viewing frequencies. Producers have an opportunity to create specialized tablet centric content to entice viewers to remain engaged and increase viewing frequencies on tablet devices. ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report

ONLINE VIDEO Device type share
of online video starts Strong connection speeds, larger screen devices, and an abundance of content continues to drive share growth of online video starts for mobile devices. Findings: • Overall growth of mobile share of online video starts is up nearly 7 percentage points YoY to 29%; 24% share growth • Smartphone share of video starts is up 38% YoY • The share of mobile online video starts for longer form content (via broadcaster sites) is almost 30% less than the mobile share on the average site 5 Insight: Mobile is now a relevant part of online video, accounting for almost 1 in 3 video starts. Advertisers must diversify their strategies and have a mobile video ad buying solution to make sure their ads are targeted differently to a desktop based audience and a mobile audience and to ensure that the ad is supported in a mobile setting. ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report

ONLINE VIDEO Device specific share
of online video starts Online video viewing on mobile devices is being dominated by Apple. The introduction of the iPhone 6 and 6+ has only escalated the growth that Apple has seen within online video viewing. 6 Findings: • iPhone share of online video starts has a commanding lead over other smartphones with over two thirds of smartphone online video starts • The iPad has an even larger piece of the tablet video viewing pie with more than four fifths of online video starts ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report

7 ONLINE VIDEO Apple share
of online video starts In taking a step back and assessing the entire online video (unauthenticated) landscape, including desktop, Apple devices have a large share video viewing. Apple has been instrumental in the growth of digital video and continues to shape how consumers are viewing with their devices. Findings: • Nearly 1 in 4 online video views come from an Apple device ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report

ONLINE VIDEO Broadcast site video
viewing Viewing behaviors of video on broadcast sites provide a good window into the viewing behaviors surrounding longer form content, as this is typically what viewers view on broadcast sites 8 Findings: • In Q1 2015 the average monthly viewing time of content on a per visitor basis was almost 8 min • The time per visitor viewing this content has increased 7% YoY ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report Insight: Coupled with the increase in viewing frequency, the increase in viewing time is evidence of an industry that is not slowing down. The amount of time consumers spend in front of a screen, large or small, is destined to grow. With all of that attention being paid to such a small area, the competition for better content will only grow. This is an opportunity for media companies, who generally have good content, to reach an ever increasing audience and drive more alternative forms of revenue.

ONLINE VIDEO Online video ad
viewing ratio growth 9ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report The ratio of ad starts to video starts is highest on tablets and smartphones. Findings: • Programmatic video ad buying is increasing the number of ads viewers watch especially in the mobile space • Tablet and smartphone ad start ratios are greater than desktop ad start ratios

TV EVERYWHERE Authenticated video growth
by share of access type TV Everywhere authenticated video starts see a continuation in growth; even during a period without unique landmark sporting events like the Olympics and World Cup. 10 Findings: • Authenticated video starts grew almost 300% over the past year • Connected TV devices are a major driver of growth for the TV Everywhere market ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report Insight: It has been known that live sports programming is often the initial hook to drive consumers to take the time to set up TV-E accounts. Our past insights have clearly shown that after the event where the account is established, most consumers continue to use the service. Interestingly authenticated viewing growth is now being sustained and continuing in the absence of a major sporting event. It appears as if this technology has crossed the chasm and moved into the "Early Majority" stage.

TV EVERYWHERE Active monthly TV
Everywhere share of Pay-TV subscribers • As more options become available to viewers the penetration of TV Everywhere into households continues to rise; active monthly viewership was up 6% QoQ and up 40% YoY 11ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report For those who are paying for television, active viewership growth remains strong. Findings: Insight: Aided by the arms race of producers to provide apps for a growing number of devices, consumers can enjoy easier access to their premium content. TV Everywhere technology provides media companies with a necessary platform to help unlock value through added services, and provide an axillary channel with which to further engage their clients. This data reveals the untapped potential that has yet to be realized by the majority of pay-TV subscribers.

TV EVERYWHERE TV Everywhere share
of authentications by access type Connected TV devices have seen a huge growth in share of authenticated starts over the last year and becoming the go-to device for how consumers are watching TV Everywhere content 12 Findings: • Devices like Apple TV, Roku, and Xbox are more frequently turned to in order to stream authenticated content • One in four authentications came from a connected device in Q1 2015; a 300% YoY share increase (50% QoQ) ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report Insight: Part of the impressive growth within the TV Everywhere space is thanks to an increase in devices that are connected to the television and solely designed to stream content. With the growth in popularity of these connected devices, the authenticated video market is poised to continue its growth

TV Everywhere viewing on an
Apple device (iOS) has always been popular, but it looks like Apple is increasing its dominance on a new front. Findings: • The growth of connected TV devices is being driven by Apple TV, doubling its share QoQ • iPad authenticated viewing now accounts for 1 in 3 authenticated video starts • Google chrome users appear to be heavy consumers of TV Everywhere content with half of all desktop views coming through Chrome 13ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report TV EVERYWHERE TV Everywhere share of authentications by device type

TV EVERYWHERE TV Everywhere daily
viewing behaviors TV Everywhere viewing moves the heavily viewed “Thursday Night Line-up” to Wednesday. • The highest share of video authentications occur on Wednesdays, followed up by the weekend • The Friday night “TV Death Slot” is actually a popular time for binge viewing 14ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report Findings: Insight: Thought to be a simple model within linear TV, ad buying for the on- demand viewer is much more complex. Advertisers are forced to implement multiple campaigns across different periods of time for differing genres of content. Then add differing types of viewing behavior (like binge viewing) and it becomes even more complicated. However if advertisers employ a programmatic strategy to their ad buying, they will gain an advantage on the competition by creating campaigns that are more efficient and productive.

TV EVERYWHERE Video viewing frequency
growth by access type The large growth of connected device viewing is also occurring with higher frequency. Connected device consumers are becoming deeply engaged with content watching more than iOS and Android users. 15 Findings: • The frequency of viewing on a connected device grew 33% YoY as these devices continue to be an outlet for binge viewing ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report

METHODOLOGY This report is based
on consumer video viewing from 2014 and 2015. It consists of the aggregated and anonymous data from sites gathered from Adobe Analytics and Adobe Primetime • 201 billion total online video starts • 2.85 billion TV Everywhere authentications • 300+ different sites and apps acting as access points for TV Everywhere 16ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report Visit our website:adobe.ly/digitalindex Read our blog:adobe.ly/digitalindex Follow us:@adobeindex and @adobeprimetime Ask a question or make a suggestion:digindex@adobe.com ©2014 Adobe Systems Incorporated. All rights reserved. Adobe and the Adobe logo are either registered trademarks or trademarks of Adobe Systems Incorporated in the United States and/or other countries. Apple TV is a trademark of Apple, Inc. registered in the U.S. and other countries. Android is a trademark of Google Inc. All other trademarks are the property of their respective owners.

• Ad start ratio: Total
ad starts per video start • Online video start: Any browser-based, unauthenticated video start. • Viewing frequency: Video start per unique viewer. • Monthly video view time: Average time spent per month viewing video per person. • Authenticated video: Video content that requires credentials from multichannel video programming distributor (MVPD). • Active monthly viewer: Viewer who authenticates at least once per month • Monthly unique visitors: Total number of unique visitors per month. • Access type • Browser includes Chrome, IE, Firefox, and Safari on both computers and mobile devices. • iOS app is an app on any Apple mobile device. • Android app is an app on any Android mobile device. • Gaming console and OTT includes Xbox, PS4, Apple TV, Roku, and similar devices. • TV Everywhere video viewing frequency −Authenticated video starts per monthly unique visitor. 17ADOBE DIGITAL INDEX | Q1 2015 Digital Video Report GLOSSARY

18ADOBE DIGITAL INDEX | Q1
2015 Digital Video Report Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Avg. Time Per Visitor Growth 100% 105% 101% 107% 107% ADOBE DIGITAL INDEX Tables Growth in Average Monthly Online Video Viewing Time per Visitor (Broadcast Sites) 3/1/14 4/1/14 5/1/14 6/1/14 7/1/14 8/1/14 9/1/14 10/1/14 11/1/14 12/1/14 1/1/15 2/1/15 3/1/15 Smartphone 100% 99% 91% 90% 86% 93% 103% 101% 101% 108% 105% 96% 113% Tablet 100% 108% 110% 111% 103% 113% 114% 113% 121% 117% 120% 111% 127% Desktop 100% 104% 103% 87% 87% 94% 102% 96% 103% 104% 103% 97% 100% Online Video As Start-to-Video Start Ratio Growth 4/1/14 5/1/14 6/1/14 7/1/14 8/1/14 9/1/14 10/1/14 11/1/14 12/1/14 1/1/15 2/1/15 3/1/15 iOS 55% 35% 34% 49% 75% 88% 67% 65% 95% 103% 150% 137% 183% Browser 17% 14% 11% 15% 21% 29% 25% 26% 39% 41% 48% 40% 53% Android 13% 9% 9% 13% 20% 27% 23% 42% 37% 38% 48% 51% 50% Connected TV Device 15% 10% 10% 19% 19% 29% 29% 37% 34% 65% 64% 75% 95% TV Everywhere Authenticated Video Viewing Growth by Access Type