January 23, 2017

Mark Contreras, CEO, Calkins Media

OTT Summit

Strategy Signals Where are the eyeballs and dollars going?

Most Legacy Media Has Lost Time and Dollars Spent...Internet & Mobile Have Grown Both

Source: Source: Nielsen, Media Dynamics, comScore, ZenithOptimedia forecasts eMarketer, The Diffusion Group

Time with OTT is projected to be 2 hours and 42 minutes a day per person by 2020.

OTT Consumption is Rapidly Growing, While Traditional Media Sees Declines

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Newspapers Consumption per Day (minutes)

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Newspapers

OTT

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3:36

4:48

6:00

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Average Media Consumption per Day (HH:MM)

Mobile Desktop/laptop TV Radio Newspapers Magazines OTT

Media Consumption

AVERAGE DAILY CONSUMPTION (HH:MM)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2017 v. 2008 % Change

Mobile 0:32 0:39 0:50 0:46 1:28 2:15 2:37 2:54 3:08 3:18 519%

Desktop/laptop 2:17 2:26 2:35 2:30 2:24 2:16 2:14 2:12 2:11 2:10 -5%

TV 4:14 4:27 4:24 4:34 4:38 4:31 4:22 4:11 4:03 3:58 -6%

Radio 1:42 1:38 1:36 1:34 1:32 1:30 1:28 1:27 1:25 1:24 -18%

Newspapers 0:38 0:33 0:30 0:28 0:24 0:20 0:18 0:17 0:16 0:15 -61%

Magazines 0:25 0:22 0:20 0:19 0:17 0:15 0:13 0:13 0:12 0:11 -56%

OTT 0:30 0:59 1:21 1:43 236%*

Source: Source: Nielsen, Media Dynamics, comScore, ZenithOptimedia forecasts eMarketer, The Diffusion Group

The Audience HAS Shifted

By 2020, there will be 97.7

million US connected TV

households, up from 88.7

million in 2016.

73.8

88.7 92.5 94.9 96.3 97.7

60.7%

72.5% 75.1% 76.6% 77.3% 77.9%

0.0%

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40.0%

60.0%

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100.0%

120.0%

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2015 2016 2017 2018 2019 2020

Connected TV households % of total householdsNote: Connected TVs are TV sets connected to the internet through built-in internet capability or through another device such as a Blu-ray player, game console or set-top box (e.g., Apple TV, Google Chromecast, Roku). Source: eMarketer, Oct 2016

CONTENT text, photo, video, audio

LEGACY NEO-LEGACY OTT SMART TV GAME CONSOLES Audio

Cable TV Web/Tablet Roku Samsung X Box Alexa

Print Mobile Fire Vizio PlayStation Google Home

Apple LG WII

Sony

Opera

Calkins Media Content Distribution Strategy

Currently or soon to be publishing on these platforms

Why Video? Why Now? Video advertising spend is growing

Source: Borrell

$22.

97

$32.

62

$48.

26 $6

9.50

$82.

68

$98.

58

$112

.10

2011 2012 2013 2014 2015 2016 2018

VIDEO ADVERTISING (IN MILLIONS) CALKINS MEDIA MARKETS

Source: webtrends, Nov 2016

Time Spent with OTT is SIGNIFICANT

95% [CATEGORY

NAME] [VALUE] Hours

2% [CATEGORY

NAME] [VALUE] Hours 3%

[CATEGORY NAME]

[VALUE] Hours

Total Time Spent Viewing Video by Platform November 2016

2.1

1.8

OTT devices TV Set-top boxes

Average Number of Devices in U.S. Households

Source: Leichtman Research Group February-March 2016

Note: OTT devices include smart TVs and streaming media devices that connect a television to the Internet. Set-top boxes are the boxes that pay TV companies rent out to subscribers.

Among all U.S. households, the mean number of streaming-capable devices is 2.1 per household, compared to 1.8 pay TV set-top boxes.

OTT Devices Outnumber Cable Boxes

56.5 57.2 57.6 56.2 55.1 54.8 54.5 53.9 53.2 52.4

18.0 21.7 27.0

41.2

56.0

73.8

88.7 92.5 94.9 96.3

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Cable and Connected Households (in millions)

Cable TV households Connected TV households

Streaming Households Surpass the Number of US Cable Households

Source: eMarketer, Oct 2016 Note: Cable TV: households with a subscription to cable TV service Connected TV: households with at least one connected TV set, where at least one person of any age uses the internet through a connected TV at least once per month

Among Households in the Calkins Media Markets

Source: Scarborough, 2016; Simmons, Spring 2016

Streaming Has Caught Up to Cable in the Calkins Media Markets as Well

202,531

446,379

726,776

Cable Company #2

Cable Company #1

Uses a Streaming Service

Content Strategy

BIG IDEA 1

To take a print-centered

newsroom and transform it into

a video-driven newsroom using

existing people and dollars.

Newsroom People Training & Development

Drew Berry & Associates, LLC 300 E. Lombard St. Suite 840 Baltimore, MD 21202 410-814-7555 drew@drewberryassociates.com

Drew Berry A two-time Emmy Award-winning President of Drew Berry & Associates, LLC, which is a media consulting agency Berry has more than 25 years of experience in the television news industry in numerous markets including New York City, Philadelphia, Dallas, Atlanta and New Orleans. He won his Emmys in his role as news director for CBS in Philadelphia Berry's experience includes teaching and practicing journalism as well as major involvement on various boards and committees

Nuts and Bolts

iPhones for newsroom staff HD cameras Editing stations Portable lights Microphones Tripods In-house studio Tricaster editing station Consultant for shows Consultant for news video In-house development of journalists Journalists trained to date; 100+

Show Development

James Andrew Miller Award-winning journalist who has worked in politics, media, and entertainment in a career spanning more than 30 years Executive VP of Original Programming for USA Network Producer with CBS News and Senior Executive Producer of both Anderson Cooper 360 & Paula Zahn Now Author of the recently released NYT best selling book Powerhouse, The Untold Story of Hollywood’s Creative Artists Agency, Those Guys Have All the Fun, Inside the World of ESPN, and Live From New York, An Uncensored History of Saturday Night Live, His first book, RUNNING IN PLACE: Inside the Senate, was also a bestseller.

64 Hours of Video Published in October

Source: Limelight Analytics

393 396 398 415

620 613

526

437

539

649 688

13.0 14.3 14.5 15.7

32.1

25.9 24.3 23.0 26.0

30.4

64.3

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30.0

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60.0

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90.0

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Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16

Hou

rs o

f Vid

eo C

onte

nt

# V

ideo

s Pub

lishe

d

Videos Published Hours of Content

Calkins Print Video Plays Across All Devices

Source: Webtrends

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50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

Total Video Plays Calkins Print Properties

Calkins OTT Apps Distribution platforms for digital video streamed to your TV via the internet

Roku Amazon FireTV Apple TV

Calkins Philly: Comcast & Verizon VOD Partnership Distribution is for entire Philadelphia DMA

BIG IDEA 2

Creating an OTT linear stream at a

local broadcast TV station to

generate additional audience and

revenue using existing resources.

VOD/Video on Demand Math Example

• 100,000 monthly video views

• $25/CPM, 100% sold out

• Monthly Revenue - $2,500, Annualized Revenue - $30,000

Business Models: VOD vs Linear Math

Linear TV Math Example: Based on 40 content minutes/20 (30 sec) ad minutes per hour

Ad Units/ Hour

Ad Units/ Day

Ad Units/ Year

Revenue/ Year

@$1/Spot 40 960 350,400 $350,400

@$5/Spot 40 960 350,400 $1,752,000

Business Model: VOD vs Linear Math

Trend of Roku, Amazon Fire and Apple TV Cumulative Downloads at One Local TV Station

Source: webtrends, iTunes, Amazon Developer, Roku Developer

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Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16

TOTA

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EW T

IME

(HO

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DO

WN

LOAD

S

DOWNLOADS AND TOTAL VIEW TIME

DOWNLOADS TOTAL TIME

Linear Channel Soft Launched 10/15

Linear Channel Hard Launch Jan

Source: Webtrends, November 2016

Mobile 12%

Desktop 9%

OTT 79%

Share of Total Plays

[CATEGORY NAME]

[PERCENTAGE]

(3M, 40S) [CATEGORY

NAME] [PERCENTAGE]

( 11M, 1S) [CATEGORY

NAME] [PERCENTAG

E] (1H, 37M)

Share of Total Time (with avg. view time per session)

Linear Drives Engagement

Source: Webtrends, November, 2016

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LIVE STREAM PLAYS BY HOUR

OTT Live Stream Plays Website Live Stream Plays

TV is the NEW TV

AM PM

Good News

• Gateway to cable carriage, low power OTA, virtual MVPDs

• Legacy TV sales reps can sell it

• Preserves legacy TV pricing model

Bad News

• Traditional TV syndicators don’t have rules yet

• It’s hard and requires a lot of planning

• There is a hard cost (bandwidth) associated with delivery that scales quickly

Linear OTT Facts

Questions?