34
Digital Media MRP FY14 – FY16 Presented July 17, 2012
D i g i t a l M e d i aM R P F Y 1 4 – F Y 1 6
P r e s e n t e d J u l y 1 7 , 2 0 1 2
2
Summary overview
Situation Regions are not investing in content. Website traffic is flat or in decline. Carriers yield influence over Networks to be the TV Everywhere provider in many
regions. What this means Websites are used more for marketing purposes and alone are not attractive to
advertisers, but bundle well with linear sponsorships.- Without good content, website traffic will remain low.
Our Networks risk lagging behind in product offerings, technology advances and customer expectations as demand evolves toward content anywhere anytime.
What we should do Continue to support websites, but begin to shift priority towards using the CMS as a
content syndication tool to develop better mobile/tablet browsing/apps. Continue to build “show-based” products, but shift to target super users by
developing new content for second screen experiences to grow loyalty and create buzz.
Look at launching new video services in key growth markets. Provide best practices (R&D) to SPT Networks.
Building blocks
3
90+ WEBSITESNEW PRODUCT
DEVICES TVE
CONTENT DEVELOPMENT
Technology & Engineering
Site Operations New Channels New Graphics Package Feature Development
Programming Priorities- Original: Hannibal- Global Acquisitions
VIDEO NETWORKS
Animax
Ad Platforms
Social TV
Websites are important for linear channels despite low growth and slow revenues. Value includes:
Bundles well with TV ad packages
Provides direct revenues from traffic
Drives tune-in and direct views to linear channel
Reinforces brand promises through interactive and video experiences
Fulfills marketing obligation to Carriers
The key will be to develop a sustained video strategy unencumbered by the TV season.
Immediate growth can happen by using 100% of existing catch-up rights; 25% increase in unique users month-over-month occurred when the addition of full-length subtitled episodes appeared the ONE website.
websites
Website Ad Opportunity
4066440695
4072540756
4078740817
4084840878
4090940940
4096941000
41030
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
Ad Impressions
Sold Ad Impressions
Continue to leverage in-house sales teams to enhance on-air bundle packages. Some regional sites will introduce local ad networks.
Opportunity
Ad impressions do not currently accommodate the high bulk needs of advertisers.
Video Content Requirements
CASE STUDY SET UK has long form video content restrictions
resulting in low video ad impressions despite high visibility on Sky and Virgin.
Whereas Crackle invests in content with no marketing and generates significant sellable ad impressions consistently year round.
UK Video Ad Impressions June 2012 Snapshot
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1.42MM
536
Without marketing a video library can drive pageviews and ad impressions.
PLAN Push to exploit catch-up on licensed
shows Leverage content from original series
and produce web-centric video content
TACTICS
FY 14 – FY 15 Launch 100% of websites on Common Platform 3.0 Continue to provide services to new Channel Launches and graphics packages Migrate ad operation duties to regions, but retain technology support. Bill back costs to
regions. Integrate Common Platform with Sony systems: GPMS Provide video services where speed to market and paywalls are needed, i.e. Animax
SVOD Integrate with Broadcast Operations to consolidate video source: MAM Provide Global Ad Sales production and sales package support
BY FY16 Upgrade to Drupal 8 or equivalent and/or migrate to proprietary CMS Explore idea of licensing CMS to 3rd parties Work with Crackle's team on shared services opportunities
- Consolidate QA
WEBSITES
Devices
80% of smartphone and tablet owners access the web during a TV program.
Creating content and second screen experiences for viewers will become an important strategy for the linear TV business.
Source: Razorfish & Yahoo report 2011
Devices
TACTICS
FY 14 – 15 Unify Mobile/Tablet Experience through the use of the new Common Platform 3.0 Syndicate video and show content via APIs to mobile, tablet, smart TV, and OTT Migrate from Brightcove to new Video provider to accommodate device fragmentation and stay
ahead of the market Shift content and product development to second screen experiences for global shows such
as Hannibal, ControlTV and Breakout Brazil in order to capitalize on new sponsorship dollars, social chatter and industry buzz.
Billback expense of incremental product development to Regions
FY 16 Leverage Crackle's multi-device clients by publishing to our own instances and modifying for
authentication and pay gating.
TV Everywhere TREND: The use of STBs to access pay-TV channels will drop to 51% in 2015.* DEVICES: The next generation of video services will trend towards the ability to
access subscriptions on any connected device. FRAGMENTATION: The TVE model is fragmented and no TV Network or Carrier is
offering the same solution.
Source: IHS Screen Digest
TACTICS
Technology Continue to evaluate and sustain relationship with technology partners i.e. Adobe and own the
development relationship globally Lead and disseminate strategic information as regions build plans with Carriers Stay on top of the latest ad platforms for video delivery Clearly define the opportunities to work with existing Sony contracts (Akamai) and Sony systems
(MAM)
Product Keep the design of sites and device UI ready for TVE integration
Represent SPTN and lead platform and product reviews as the opportunity to form a consortium with HBO/Ole is formed.300K projected unique users in the first year.
Not ready for D2C TVE, but will provide best practices and different digital models to support their efforts to provide a simulcast of the Channel directly to Carrier’s digital platforms.
TV Everywhere
LATIN AMERICA ASIA
Led product discussions with Astro and PCCW. Need to shift strategy based on MVPD play.
Support unauthenticated catch-up through ONE.
EMEA
Video Networks
Regions have shown interest in growing Video Networks outside of the Crackle brand and FVOD strategies.
Carriers such as BSkyB will begin to capitalized on the opportunity to create video services over the top.
Video NetworksTACTICS
UNITED KINGDOMAnimax SVOD will be the first to experiment with digital subscriptions and rentals.
Lead technology efforts for the first online subscription service under SPTN Provide foundation to grow these types of services into other regions (i.e. Animax
Japan)
BBC’s iPlayer is the world’s leading catch-up service. iPlayer has expanded internationally by selling subscriptions for $10 USD/mo.
Source: Generator Research 2012; OPA 2011
FACTS
Investment in digital-specific content for an enhanced second screen experience will bring additional sponsorship dollars where websites cannot.
Programming & Content development
TACTICS FY14
Produce launch and sustain experiences that take advantage of the concept of synced TV watching
To scale, we must focus on creating re-usable engines that support multiple priorities shared across regions and business units.
To monetize above sponsorship deals, encourage the use of catch-up rights across platforms.
FY 15 - 16
Produce digital products for 3 Original Shows a year
Produce or localize products for multi-regional acquired shows
Evolve casual gaming strategy to support original & acquired shows
Programming & Content development
Social TV
Source: Bluefin Labs; Data for 1-1-2011 – 12-31-2011Primetime only; New and repeat telecasts included
SOCIAL MEDIA COMMENTARYTop performers in online comments
The X-Factor/Fox 3.8 M
Glee/Fox 2.4 M
Jersey Shore/MTV
2.3 M
Dancing with Stars/ABC 1 M
American Idol/Fox 886
K
The Voice/NBC 866
K
Real Housewives/Bravo 732
K
Beyond Scared Straight/A&E 624
K
Basketball Wives/VH1
563 K
Pretty Little Liars/ABC Family
556 K
Nielsen states that a 9% increase in social buzz correlates to a 1% increase in TV ratings.
Source: Nielsen’s study “TV Viewers Get Social” October 2011
TACTICS
Implement Gigya to provide an easy way to sign up for contests, sweepstakes or newsletters using a social account
Integrate social with all plans and create an episodic conversation with viewers, coinciding with a second screen experience for shows like Hannibal
Lead monthly tactical meetings with all regions through our relationships with Facebook, Twitter, YouTube, GetGlue, Pinterest and up and coming social networks
Social TV
Source: Facebook
The LATAM/BR Facebook pages are the most “liked” SPTN channels. Have hired NoBox to help Implement and expand social media tools.
5 of the top 10 markets for Facebook penetration are in Latin America.
CE has started to explore commenting and will introduce editorial focused sites FY13
Europe has some of the most socially engaged countries.
LATIN AMERICA ASIA
Hired manager concentrating on Social efforts. Provide guidance and support to increase growth.
EMEA
SPT Networks are “liked” by over 2.9MM Facebook users. Our growth means that our viewers are actively engaged and a robust social strategy could influence the success of a show.
Video Networks
Devices
Websites
Common Platform SUPPORT
Video Networks
Video NetworksDevicesWebsites
Multi-Site Drupal Installation and common themes used to increase speed to market and cost efficiencies. Regions do not need a backend tech team.
Unified platform of global tools and systems of record.• Drupal 7• Brightcove• Gigya• DFP• Hosting Environment• Legal Compliance
3rd party CMS such as Mobile Roadie. RSS feeds out to other mobile apps.
The Common Platform will serve as the future foundation for new OTT businesses i.e. Animax SVOD U.K.
THE COMMON PLATFORM
P&L Overview$ in thousands
Revenue Overview$ in thousands
Headcount requirements
TITLE LEVEL RESPONSIBLE
Product Manager, Video Manager
Leads migration from Brightcove to new OVP Expert Video Manager, leads operations and best practices Responsible for management of global video product for SPT on all
digital platforms. e.g. SVOD Animax Key video point person for all regional teams Digitize and upload multi-regional video content i.e. Hannibal
Product Manager Manager
Social Media global expert for all of SPTN Develop Social best practices and strategy, dealing with the global
presence of SPTN products Key partner relationships: Facebook, Twitter, YouTube, Gigya, Pinterest,
Get Glue Support regions by disseminating information about new contract
agreements, products enhancements and U.S. strategies
Anticipates international growth to affect video and social media technologies for new video businesses and Original Programming content development.
China German Language Italy Poland Czech Republic Hong Kong Singapore Portugal0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
11000
12000
13000
14000
15000
16000
17000
WHERE DO WE LOOK FOR MORE GROWTH?
Online
Mobile
2016 E Online & Mobile Advertising(U.S. not included)
(MM)
Top 9 Regions have $1B+ Markets
(78% of WW Market)
English speaking countries include:UK, Canada, Netherlands, Australia, NZ, Ireland
Spanish speaking countries include:Spain, Argentina, Mexico, Venezuela, Chile
Source: PwC June 2012
On
line
Ad
Mar
ket
(Exc
lud
ing
Sea
rch
)
2016 Broadband Penetration Forecast
UK
Germany
ItalyRussia
SpainPoland
Brazil
IndonesiaIndia Philippines
So. Africa Romania Malaysia
Czech Republic
Taiwan
Portugal
Hungary
DIGITAL LANDSCAPE FUTURE (excluding United States)
Turkey
(MM)
Pan LatAm
• Broadband is projected to grow over 10% in all but 4 countries (and those 4 countries already have HH penetration over 70%).
• Online Advertising is projected to grow over 30% in all countries.
Source: PwC June 2012; 2016 U.S. Projections: 85% broadband penetration, $72B Online Ad
Joint Venture
Owned & Operated
Canada
Australia
Top 5> $500MM & 30%
Japan
HK Singapore
So. Korea
50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%0
2000
4000
6000
8000
10000
12000
Appendix
Sony Pictures TelevisionNetworks Websites
2012 MRPOperating Expense Summary
($ in thousands)
FY'14 FY'15 FY'16
Dept 2011 MRP 2012 MRP 2011 MRP 2012 MRP 2012 MRP
Ad Operations $300 $20 $350 $20 $30
Hosting 400 $400 450 $450 $500
Video Platform 350 $400 400 $450 $500
Development Team 1,100 $1,398 1,200 $1,665 $ 1,805
Platform Development 600 $600 700 $700 $970
Wiki 15 $15 15 $15 $15
Security 50 $50 50 $50 $150
Domains 50 $50 60 $60 $70
Content Data Network (CDN) 40 $10 50 $15 $20
Analytics 60 $60 70 $70 $80
Translation 30 $15 40 $15 $15
Moderation 72 $72 72 $80 $85
Community Design 100 $100 100 $100 $150
Social Networking 200 $200 200 $200 $250
Games 0 $60 0 $60 $70
Mobile 0 $0 0 $0 $70
QA 50 $50 50 $50 $70
Total Operating Expense $3,417 $3,500 $3,807 $4,000 $4,850
Operating Expense
Technology & Engineering Backend Operations
Hired Technical Producer
Security
100% remediation rate for InfoSec notifications.
Hosting
In FY11 mini-outages comprised 68.5 hours of aggregated downtime with 310 outages logged during. FY12 we completed the site stability project to identify the source and eliminate mini-outages achieving 100% uptime.
Started next-gen hardware architecture planning which would increase server capacity by another 100%
Product Site Operations
Hired Site Operations Producer
225% increase in productivity! 2,311 Tickets Closed FY12 vs. 711 Tickets in FY11.
24 sites, 17 Themes launched
15 new sites added to portfolio (24% increase)
Platform enhancements
Video interface, Schedule grid, Games section, Enhanced show pages, “Lite” site platform
Social
Platform integration of social features
Teen Wolf, and Pan Am Facebook Apps
The Firm Social Strategy
New Product Development
New game engines (Spot the diff)
Top 5 Module enhancements
Quiz/Contest enhancements
Programming support
Teen Wolf , The Firm (Largest rollout to date)
Next Gen Platform Planning
Began upgrade to Drupal 7
Discovery, Requirements, and IA
FY12 successes
FY12 Successes
Ad Operations• Statistics
• 131MM ad impressions delivered
• 510 Ad Campaigns
• 2 Ad Networks
• New Packages
• Introduced new ad opportunities such as clickable backgrounds
• Developed new ad packages for shows such as The Firm
• Identified new social ad opportunities through the Teenwolf, Missing and Pan Am Facebook apps.
• Operations
• Trained 12 New Staff for Ad Trafficking
• Global Ad Sales Support
• Men in Black 3 Trailer Syndication
• SkyFalls Trailer Syndication
Emerging Platforms
• TV Everywhere Technology scope and business planning in Asia and LATAM
• Gigya Agreement Closed
• Mobile Roadie Agreement Closed LATAM Apps launched
• Animax SVOD Business Plan
FY13 Priorities
• New Channels
• Movies4Men
• Turbo (Russia)
• Turkey Acquisition
• Animax SVOD UK
• Migration and upgrade sites to Common Platform 3.0
• Content Development
• Hannibal
• Control TV
• Breakout Brazil
• From the Basement
• Multi-Regional Shows
• Video
• Video Authentication in LATAM and Asia
• Social
• Integrate Social Sign-On
• Mobile Apps
• LATAM/BR – AXN, SET
REGION• A
d Sales
• Content
• Implementation
• Marketing
• Social Media
HOME OFFICE• C
ommon Platform
• Licenses
• Engineering
• Operations
• Strategy & Best Practices
Home Office + Region
●Social Media●Marketing●ContentREGION●Ad Sales●Implementation
●Common Platform●Licenses●Engineering●Operations●Strategy & Best PracticesHOME OFFICE
Social Strategies5 of the top 10 markets for Facebook penetration are in Latin America.
TV EverywhereBy 2016 there will be 70MM subs and over 65% broadband penetration, creating the need to access channels across devices.
Migrate Sites to Common Platform in order to service new devices and second screen experiences.
The LATAM/BR Facebook pages are the most “liked” SPTN channels. Implement and expand social media tools such as Gigya.
Authenticated Catch-up will eventually roll out with projected unique users of 300K in the first year. We will provide U.S. Best Practices, technology support and recommendations.
Latin America/Brazil prioritiesWebsite & Connected
DevicesBy 2015, Latam will have a mobile penetration rate of 130% (more than one device per person).In Brazil by 2016, video is estimated to reach 76% of all mobile traffic.
Source: GSMA Report 2012; Cisco 2012; comScore 2011
On
line
Ad
Mar
ket
(Exc
lud
ing
Sea
rch
)
2016 Broadband Penetration Forecast
IndonesiaIndia Philippines
Malaysia Taiwan
(MM)
• Southeast Asian countries challenged by online ad market below $500MM.
• South Korea and Japan are in the top 5 for growth in both ad market and broadband penetration.
Source: PwC June 2012
Top 5
Joint Venture
Owned & Operated
> $500MM & 30%
50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%0
2000
4000
6000
8000
10000
12000
HK Singapore
So. Korea
Japan
Asia & korea growth opportunities
100% E Advertising Growth109% E Advertising Growth
39% E Advertising Growth
71% E Advertising Growth
58% E Advertising Growth
26% E Advertising Growth
114% E Advertising Growth
49% E Advertising Growth127% E Advertising Growth
Websites, Mobile, Connected
DevicesBy 2016, Asia Pacific
will account for 40% of the world’s mobile
traffic.
New Businesses94% of South Koreans
have high speed internet. Of those 44% have fiber
optic connections.
TV EverywhereFrom 2012 to 2016, Asia
Pacific pay-TV is expected to grow 27%.
Migrate Sites to Common Platform in order to service new devices and second screen experiences.
Authenticated catch-up will most likely be offered through MVPD only. Continue to advise business models and technology. Support unauthenticated catch-up through ONE.
asia & Korea priorities
Social Strategies
Mobile social gaming in Japan generates over $2b USD. 87% of S. Korean internet users utilize social
media.
Hired manager concentrating on Social
efforts. Provide guidance and support
to increase growth.
Source: Cisco 2012; PwC 2012; Generator Research 2012
Explore opportunity for a South Korean Video Network.
50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%0
2000
4000
6000
8000
10000
12000
On
line
Ad
Mar
ket
(Exc
lud
ing
Sea
rch
)
2016 Broadband Penetration Forecast
UK
Germany
ItalyRussia
SpainPoland
So. Africa Romania
Czech Republic Portugal
Hungary
Turkey
(MM)
Source: PwC June 2012
Joint Venture
Owned & Operated
79% E Advertising Growth
171% E Advertising Growth
82% E Advertising Growth
70% E Advertising Growth
47% E Advertising Growth
52% E Advertising Growth
94% E Advertising Growth
42% E Advertising Growth
113% E Advertising Growth87% E Advertising Growth
57% E Advertising Growth
48% E Advertising Growth
> $500MM & 30%
EMEA growth opportunities
Continue to develop the
Common Platform and extend out to multiple devices.
Create second
screen experiences.
Implement Social plug-ins and assist in the
development of social strategies that sustain
the “buzz”.
Support the launch of Animax SVOD, OTT
Service in Spain, Catch up where
applicable.
Concentrate TV Everywhere efforts on
simulcasts with MVPDs and continue
to pass best practices.
EMEA PrioritiesContent
In 2011, 72% of Europeans downloaded
or watched a video online. Of those, 14%
have paid to watch a full length movie.
Develop series sustain support plans vs. launch.
Would only like digital content for TV shows in
second season (e.g., Firm, PanAM).
Website & Connected
DevicesIn 2012, 50% of Spain’s internet use was accessed via mobile.
In 2011, 32% of Poland’s TV sales were Connected TVs.
TV Everywhere
BBC’s iPlayer is the world’s leading catch-up service. iPlayer has expanded internationally by selling subscriptions for $10 USD/mo.
Social StrategiesRussia has the most socially engaged population – double the global average. (9.8 hrs./mo.)
Source: Generator Research 2012; OPA 2011
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