U.S. Entertainment Industry:

U.S. Entertainment U.S. Entertainment Industry:Industry:

2006 Market

Statistics

MPA Worldwide Market Research & MPA Worldwide Market Research & AnalysisAnalysis

Table of ContentsBox

Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3-5Admissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-9Films Released . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10-12Ratings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13-14Theatrical . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15-23

Theatrical Costs . . . . . . . . . . . . . . . . . . 15-16Negative Costs . . . . . . . . . . . . . . . . . . 17Marketing Costs . . . . . . . . . . . . . . . . . 18-20Screens . . . . . . . . . . . . . . . . . . . . . . . . 21-22Theaters . . . . . . . . . . . . . . . . . . . . . . . 23

Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24-25Home Video . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26-34

Penetration . . . . . . . . . . . . . . . . . . . . . 26-27VCR & DVD Statistics . . . . . . . . . . . . . 28-29DVD Statistics . . . . . . . . . . . . . . . . . . . 30-34

Television . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35-41

Television Statistics . . . . . . . . . . . . . . . 35-36Cable & Satellite Statistics . . . . . . . . . 37-41

Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42-48

PC Statistics . . . . . . . . . . . . . . . . . . . . . 42-43Internet Statistics . . . . . . . . . . . . . . . . . 44-48

Media Consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49-52

Page Page 22

Source: MPAA

Box Office

Box Office Trends

$9.52 $9.49 $9.54

$8.99

$9.49

$8.0

$9.0

$10.0

2002 2003 2004 2005 2006

Billi

ons USD

-5.7%

+5.5%

-0.3% +0.5%

U.S. Entertainment Industry: 2006 Market Statistics

Page Page 33

The U.S. box office rebounded in 2006 with $9.49 billion, a 5.5% gain.

Source: MPAA

Box Office

Box Office Growth

Box Office has grown $3.6 billion over the last 10 years and $5.7 billion over the last 20.


Page Page 44

Box Office Gross

Year (USD Millions) Prev. Period 20062006 9,487.8 5.5% -2005 8,991.2 -5.7 5.5%2004 9,539.2 0.5 -0.52003 9,488.5 -0.3 0.02002 9,519.6 13.2 -0.32001 8,412.5 9.8 12.82000 7,660.7 2.9 23.91999 7,448.0 7.2 27.41998 6,949.0 9.2 36.51997 6,365.9 7.7 49.01996 5,911.5 7.6 60.51995 5,493.5 1.8 72.71994 5,396.2 4.7 75.81993 5,154.2 5.8 84.11992 4,871.0 1.4 94.81991 4,803.2 -4.4 97.51990 5,021.8 -0.2 88.91989 5,033.4 12.9 88.51988 4,458.4 4.8 112.81987 4,252.9 12.6 123.11986 3,778.0 0.8 151.1

% Change vs.

Source: Variety

Box Office

2006 High Grossing Opening Weekend

3 of the top 5 openers in 2006 were sequels, with the second Pirates of the Caribbean installment, Pirates of the Caribbean: Dead Man’s Chest, taking the top spot with $135.6 million.


Page Page 55

Rank Title Distributor Release DateBox Office (USD MM)

1 Pirates of the Caribbean: Dead Man's Chest Buena Vista July 7th $135.6

2 X-Men: The Last Stand Fox May 26th 122.9

3 The Da Vinci Code Sony May 19th 77.1

4 Ice Age: The Meltdown Fox March 31st 68.0

5 Cars Buena Vista June 9th 60.1

6 Superman Returns Warner Bros. June 28th 52.5

7 Mission: Impossible 3 Paramount May 5th 47.7

8 Talladega Nights: Ballad of Ricky Bobby Sony August 4th 47.0

9 Night at the Museum Fox December 22nd 42.2

10 Happy Feet Warner Bros. November 17th 41.5

11 Casino Royale Sony November 17th 40.8

12 Scary Movie 4 TWC April 14th 40.2

13 Click Sony June 23rd 40.0

14 The Break-Up Universal June 2nd 39.2

15 Over the Hedge Paramount May 19th 38.5

16 Saw III Lionsgate October 27th 33.6

17 Madea's Family Reunion Lionsgate February 24th 30.0

18 Jackass: Number Two Paramount September 22nd 29.0

19 Inside Man Universal March 24th 29.0

20 Nacho Libre Paramount June 16th 28.3

Opening WeekendHighest

Grossing film:

2006: $135.6 million

1996: $56.8 million

Source: MPAA

Admissions

Admissions Trends

1.64

1.571.54

1.401.45

1.2

1.3

1.4

1.5

1.6

1.7

2002 2003 2004 2005 2006

Billi

ons

-8.7%

+3.3%

-4.0%

-2.4%


Page Page 66

A 3-year decline in ticket sales ended in 2006 when 1.45 billion tickets were sold, a 3.3% increase.

Source: MPAA

Admissions

Admissions Growth

In 2006, admissions gained 3.3%, ending a 3-year decline.


Page Page 77

Year Admissions Prev. Period 20062006 1,448.5 3.3% -2005 1,402.7 -8.7 3.3%2004 1,536.1 -2.4 -5.72003 1,574.0 -4.0 -8.02002 1,639.3 10.2 -11.62001 1,487.3 4.7 -2.62000 1,420.8 -3.0 1.91999 1,465.2 -1.0 -1.11998 1,480.7 6.7 -2.21997 1,387.7 3.7 4.41996 1,338.6 6.0 8.21995 1,262.6 -2.3 14.71994 1,291.7 3.8 12.11993 1,244.0 6.0 16.41992 1,173.2 2.9 23.51991 1,140.6 -4.0 27.01990 1,188.6 -5.9 21.91989 1,262.8 16.4 14.71988 1,084.8 -0.3 33.51987 1,088.5 7.0 33.11986 1,017.2 -3.7 42.4

% Change vs.

Note: 1989 to present based on NATO average ticket price

Source: MPAA

Admissions

Admissions Trends per Capita

4.74

5.70

4.654.24

4.525.05

5.30 5.245.43

4.81

2.0

3.0

4.0

5.0

6.0

7.0

1981 1986 1991 1996 2001 2002 2003 2004 2005 2006

Adm

issio

ns


Page Page 88

Source: MPAA, Bureau of Labor Statistics

Admissions

Average Annual Admission Price


Page Page 99

Note: NATO average ticket price based on a survey by Goodman & Company and reflects average price paid for all admissions to movie theaters, inclusive of first run, subsequent runs, senior citizens, children, and all special pricing.

Year Prev. Period 2005 vs.2006 $6.55 2.2% - 3.2%2005 $6.41 3.2% 2.2% 3.4%2004 $6.21 3.0% 5.5% 3.3%2003 $6.03 3.8% 8.7% 1.9%2002 $5.81 2.7% 12.7% 2.4%2001 $5.66 4.9% 15.8% 1.6%2000 $5.39 6.1% 21.5% 3.4%1999 $5.08 8.3% 28.9% 2.7%1998 $4.69 2.3% 39.6% 1.6%1997 $4.59 3.9% 42.8% 1.7%1996 $4.42 -- 48.3% 3.3%

% Change CPI

% ChangeAvg. Annual Admission Price (USD)

Source: MPAA

Films ReleasedU.S. Entertainment Industry: 2006

Market Statistics

Page Page 1010

Note: Films rated may be higher than films produced for a given year because films may be rated or rerated months or even years after production.

Year Produced Rated Released2006 480 853 6072005 699 931 5492004 611 871 5282003 593 940 4732002 543 786 4662001 611 739 4832000 683 762 4781999 758 677 4611998 686 661 5091997 767 673 5101996 735 713 471

Number of Theatrical Films Produced, Rated, & Released

Source: MPAA


Market Statistics

Page Page 1111

Feature Films Released in the US

Average Box Office of New Releases

YearAll New Releases

MPAA New Releases

2006 $15.8 $32.72005 $15.8 $38.12004 $20.0 $34.62003 $20.7 $41.62002 $21.2 $32.8

NEW FILMS REISSUED FILMS

Year MPAAAll Other

DistributorsTotal New Releases

MPAAAll Other

DistributorsTotal New Releases

2006 203 396 599 1 7 82005 190 345 535 4 10 142004 199 275 474 1 7 82003 194 265 459 4 10 142002 220 229 449 5 12 171996 215 205 420 25 26 51

There were 12% more films released in 2006 than in 2005.

MPAA new releases grossed an average of $32.7 million.

Source: MPAA


Market Statistics

Page Page 1212

Feature Films Released in the US

549

466471 482473

607

449 474535

420

599

459

8 1451

17 14 80

100

200

300

400

500

600

1996 2002 2003 2004 2005 2006

Total New Releases Reissued

Source: MPAA, Nielsen EDI

RatingsU.S. Entertainment Industry: 2006

Market Statistics

Page Page 1313

Top 20 GrossingYear G PG PG-13 R2006 5% 20% 65% 10%2005 5% 25% 60% 10%2004 5% 25% 55% 15%2003 5% 15% 60% 20%2002 5% 30% 65% 0%

2006 TOP GROSSING FILMS

Rank Title DistributorBox Office (USD MM)

Rating

1 Pirates of the Caribbean: Dean Man's Chest Buena Vista $423.3 PG-132 Cars Buena Vista $244.1 G3 X-Men: The Last Stand Fox $234.4 PG-134 Night at the Museum Fox $218.6 PG-135 The Da Vinci Code Sony $217.5 PG6 Superman Returns Warner Bros. $200.1 PG-137 Ice Age: The Meltdown Fox $195.3 PG8 Happy Feet Warner Bros. $192.1 PG9 Casino Royale Sony $165.5 PG-1310 Over the Hedge Paramount $155.0 PG11 The Pursuit of Happyness Sony $154.3 PG-1312 Talladega Nights: The Ballad of Ricky Bobby Sony $148.2 PG-1313 Click Sony $137.4 PG-1314 Mission: Impossible 3 Paramount $134.0 PG-1315 Borat Fox $127.9 R16 The Departed Warner Bros. $126.3 R17 The Devil Wears Prada Fox $124.7 PG-1318 The Break-Up Universal $118.8 PG-1319 Scary Movie 4 TWC $90.7 PG-1320 Dreamgirls Paramount $88.7 PG-13

In 2006, 13 of the top 20 films were rated PG-13. PG and PG-13 films account for 85% of 2006’s top 20 films.

PG-1365%

R10%

G5%

PG20%13 films

2

2006 Top 20 Films by Rating

1

4

Includes box office data as of February 2007

RatingsU.S. Entertainment Industry: 2006

Market Statistics

Page Page 1414

NC-17/ X2%

G7%

PG21%

PG-1312% R

58%

Percent of Films by Rating1968 to 2006

Top Grossing Films by Rating: 1968 to 2006


Release Date

1 Finding Nemo Buena Vista 339.7 May 032 The Lion King Buena Vista 328.5 Jun 943 Monsters, Inc. Buena Vista 255.9 Nov 014 Toy Story 2 Buena Vista 245.9 Nov 995 Cars Buena Vista 244.1 Jun 06

1 Star Wars Fox 461.0 May 772 Shrek 2 DreamWorks 436.7 May 043 E.T. Universal 435.0 Jun 824 Star Wars: The Phantom Menace Fox 431.1 May 995 Harry Potter and The Sorceror's Stone Warner Bros. 317.6 Nov 01

1 Titanic Paramount 600.8 Dec 972 Pirates of the Caribbean: Dead Man's Chest Buena Vista 423.3 Jul 063 Spider-Man Sony 403.7 May 024 Star Wars: Ep. III Revenge of the Sith Fox 380.2 May 055 Lord of the Rings: Return of the King New Line 377.0 Dec 03

1 The Passion of the Christ NewMarket 370.3 Feb 042 The Matrix: Reloaded Warner Bros. 281.5 May 033 Beverly Hills Cop Paramount 234.8 Dec 844 The Exorcist Warner Bros. 232.7 Dec 735 Saving Private Ryan DreamWorks 216.2 Jul 98

RPG

-13

PGG

Source: MPAA, Nielsen EDI

MPAA Member Company Average Theatrical Costs

Mill

ions

US

D

Source: MPAA

Theatrical Costs


Page Page 1515

$47.8

$30.4

$66.3

$39.5

$65.7

$34.8

$63.6

$36.1

$65.8

$34.5

$0

$20

$40

$60

$80

$100

2002 2003 2004 2005 2006

MarketingCosts

NegativeCosts

$100.3

$78.2

$100.5

$105.8

$99.7

Note: All data adjusted to exclude MGM.

MPAA Member Subsidiary/Affiliate* Average Theatrical Costs

Mill

ions

US

D

Source: MPAA

Theatrical Costs


Page Page 1616

$34.0

$11.4

$46.9

$15.1

$29.0

$11.4

$23.5

$15.2

$30.7

$17.8

$0

$10

$20

$30

$40

$50

$60

$70

2002 2003 2004 2005 2006

MarketingCosts

NegativeCosts

$48.5$45.

4 $40.4

$62.0

$38.7

* Subsidiaries and affiliates include studio “classics” and specialty divisions such as Fox Searchlight, Miramax, New Line, Sony Pictures Classics, etc.Note: All data adjusted to exclude MGM.

Theatrical Costs


Page Page 1717

Average Negative Costs(includes production costs, studio overhead and capitalized interest)

Source: MPAA

* Subsidiaries and affiliates include studio “classics” and specialty divisions such as Fox Searchlight, Miramax, New Line, Sony Pictures

Classics, etc.

MPAA Member Company MPAA Subsidiary/Affiliate% Change vs. % Change vs.

Year Prev. Period 2006 Prev. Period 2006

2006 $65.8 3.5% - $30.7 30.6% -2005 $63.6 -3.2% 3.5% $23.5 -19.0% 30.6%2004 $65.7 -0.9% 0.2% $29.0 -38.2% 5.9%2003 $66.3 38.7% -0.8% $46.9 37.9% -34.5%2002 $47.8 0.2% 37.7% $34.0 7.9% -9.7%

Avg. Negative Cost per Feature

(USD MM)

Avg. Negative Cost per Feature

(USD MM)


Theatrical Costs


Page Page 1818

Average Marketing Costs of New Feature Films

Source: MPAA

MPAA Member Company MPAA Subsidiary/Affiliate *

Year Print Advertising Total P&A Print Advertising Total P&A2006 $3.82 $30.71 $34.53 $2.09 $15.74 $17.832005 $3.83 $32.36 $36.19 $1.85 $13.31 $15.162004 $3.75 $30.61 $34.36 $1.29 $10.13 $11.422003 $4.21 $34.84 $39.05 $1.87 $12.80 $14.672002 $3.31 $27.31 $30.62 $1.42 $9.76 $11.181996 $2.63 $17.21 $19.84 NA NA $0.001986 $1.24 $5.44 $6.68 NA NA $0.00

USD 000's USD 000's

* Subsidiaries and affiliates include studio “classics” and specialty divisions such as Fox Searchlight, Miramax, New Line, Sony Pictures

Classics, etc.Note: All data adjusted to exclude MGM.

Theatrical Costs


Page Page 1919

MPAA Member Company Distribution of Advertising Costs by Media

Source: MPAA

% of Total

Year Avg $ (000's)

NewspaperNetwork

TVSpot TV

Internet/Online

TrailersOther Media

OtherNon-Media

2006 $30.71 10.8% 21.2% 13.9% 3.7% 4.3% 24.4% 21.6%2005 $32.35 12.7% 23.1% 12.8% 2.6% 4.4% 22.4% 22.0%2004 $30.96 12.9% 23.0% 13.2% 2.4% 7.6% 22.2% 18.9%2003 $34.34 14.0% 23.0% 15.6% 1.4% 4.5% 21.9% 19.5%2002 $27.13 13.6% 22.8% 17.5% 0.9% 4.6% 21.7% 18.8%

Other Non-Media22%

Other Media24%

Network TV21%

Newspaper11%

Internet/ Online1%

Spot TV14%

Trailers4%

Other Media includes:• Cable TV• Radio• Magazines• Billboards

Other Non-Media includes:• Production/Creative Services • Exhibitor Services• Promotion & Publicity• Market Research


Theatrical Costs


Page Page 2020

MPAA Member Subsidiary/Affiliate* Distribution of Advertising Costs by

Media

Source: MPAA

% of Total

Year Avg $ (000's)

NewspaperNetwork

TVSpot TV

Internet/Online

TrailersOther Media

OtherNon-Media

2006 $15.74 15.4% 18.3% 13.3% 4.5% 5.0% 22.6% 20.9%2005 $13.30 15.5% 21.7% 12.6% 2.5% 5.6% 23.3% 18.8%2004 $30.96 12.9% 23.0% 13.2% 2.4% 7.6% 22.2% 18.9%2003 $35.34 14.0% 23.0% 15.6% 1.4% 4.5% 21.9% 19.5%2002 $10.96 21.4% 26.7% 5.4% 0.9% 6.2% 21.8% 17.5%

Other Media includes:• Cable TV• Radio• Magazines• Billboards

Other Non-Media includes:• Production/Creative Services • Exhibitor Services• Promotion & Publicity• Market Research

Other Non-Media21%

Other Media23%

Network TV18%

Newspaper15%

Internet/ Online1%

Spot TV13%

Trailers5%

* Subsidiaries and affiliates include studio “classics” and specialty divisions such as Fox Searchlight, Miramax, New Line, Sony Pictures Classics, etc.


TheatricalU.S. Entertainment Industry: 2006

Market Statistics

Page Page 2121

Total Number of Screens

Source: Nielsen EDI

YearTotal

Screens% Change vs. 2006

Indoor Screens

% Change vs. 2006

Drive-In Screens

% Change vs. 2006

2006 39,668 - 38,943 - 725 -2005 38,852 2.1% 38,143 2.1% 709 2.3%2004 36,594 8.4% 35,993 8.2% 601 20.6%2003 35,786 10.8% 35,499 9.7% 647 12.1%2002 35,280 12.4% 34,630 12.5% 650 11.5%2001 36,764 7.9% 36,110 7.8% 654 10.9%2000 37,396 6.1% 36,679 6.2% 717 1.1%1996 29,690 33.6% 28,864 34.9% 826 -12.2%1991 24,570 61.4% 23,662 64.6% 908 -20.2%1986 22,765 74.2% 19,947 95.2% 2,818 -74.3%

Worldwide Digital Cinema Screens*


Market Statistics

Page Page 2222

30 39 159 190 334

848

2,996

0

500

1,000

1,500

2,000

2,500

3,000

2000 2001 2002 2003 2004 2005 2006

154%

308%

76%19%

Source: Screen Digest

253%

30%

*Historical figures updated by source


Market Statistics

Page Page 2323

Theaters by Number of Screens

2006

Source: Nielsen EDI

Type# of

Theaters# of

Screens

Single Screen 1,742 1,742

Miniplexes(2-7 Screens)

2,362 9,399

Multiplexes(8-15 Screens)

1,661 17,673

Megaplexes(16+ Screens)

591 10,854

Total Number of Theaters: 6,356

EmploymentU.S. Entertainment Industry: 2006

Market Statistics

Page Page 2424

US Motion Picture Industry Employment Areas(000s)

Source: Bureau of Labor Statistics

YearPrev. Period

2006

2006* 194.3 134.5 28.5 357.3 0.0% -2005 195.6 133.2 28.4 357.2 -1.7% 0.0%2004 196.5 137.4 29.3 363.2 3.3% -1.6%2003 183.1 139.2 29.4 351.7 -2.5% 1.6%2002 191.7 138.4 30.6 360.7 4.0% -0.9%2001 180.9 133.2 32.6 346.7 -1.4% 3.1%2000 182.1 136.9 32.6 351.6 -0.7% 1.6%1999 182.5 138.6 32.9 354.0 4.5% 0.9%1998 172.0 135.0 31.7 338.7 4.9% 5.5%1997 159.6 131.2 32.2 323.0 5.6% 10.6%1996 149.8 122.2 33.9 305.9 2.5% 16.8%

Production & Services

TotalTotal % Change vs.

Theaters & Video Rental

Other

* 2006 figure is preliminary

Source: Bureau of Labor Statistics

Employment

Motion Picture Industry Employment Areas

196 194197183192181182

137 133 138 139 137 133 135

2933 33 31 29 29 28

20

60

100

140

180

2000 2001 2002 2003 2004 2005 2006

Thou

sand

s

Production &Services

Theaters &Video Rental

Other


Page Page 2525

Home VideoU.S. Entertainment Industry: 2006

Market Statistics

Page Page 2626

Source: Nielsen Media Research

YearPrev. Period

2006

2006 111.4 93.1 -1.0% - 83.6%2005 110.2 94.0 0.6% -1.0% 85.3%2004 109.6 93.4 -2.2% -0.3% 85.2%2003 108.4 95.5 -1.0% -2.5% 88.1%2002 106.7 96.5 0.3% -3.5% 90.4%1996 95.0 84.4 N/ A 10.3% 88.8%1986 85.9 36.1 N/ A 157.9% 42.0%

VCR Penetration Rate

(% of TV HHs)

VCR

TV Households

(MM)

VCR Households

(MM)

% Change VCR HHs vs.

VCR Penetration in US TV Households


Market Statistics

Page Page 2727

Source: Nielsen Media Research, Adams Media Research

YearPrev. Period

2006

2006 111.4 95.7 4.8% - 85.9%2005 110.2 91.3 8.3% 4.8% 82.8%2004 109.6 84.3 20.9% 13.5% 76.9%2003 108.4 69.7 29.1% 37.3% 64.3%2002 106.7 54.0 -43.9% 77.2% 50.6%

DVD Penetration Rate

(% of TV HHs)

DVD

TV Households

(MM)

DVD Households

(MM)

% Change DVD HHs vs.

DVD Penetration in US TV Households

2006 Total HDV Set-Top Console Households = 300,0002006 Total HDV Households (including game & PC HDV-ROM) = 1,300,000


Market Statistics

Page Page 2828

Source: Adams Media Research

Units in Millions

YearRental

CassettesSell-Through

CassettesTotal

CassettesPrev. Period

2006

2006 1.6 5.8 7.4 -84.8% -2005 14.9 33.8 48.7 -61.2% -84.8%2004 33.0 92.5 125.5 -48.6% -94.1%2003 47.5 196.9 244.4 -37.5% -97.0%2002 73.6 317.7 391.3 - -98.1%

% Change vs.

VCR

Sales of Home Entertainment to US Dealers*

Units in Millions

YearRental DVDs

Sell-Through DVDs

Total DVDsPrev. Period

2006

2006 184.5 1,140.2 1,324.7 2.5% -2005 178.4 1,114.5 1,292.9 6.6% 2.5%2004 149.1 1,063.3 1,212.4 37.9% 9.3%2003 110.9 768.3 879.2 42.0% 50.7%2002 79.3 539.9 619.2 - 113.9%

% Change vs.

DVD

* Historical figures have been updated by source


Market Statistics

Page Page 2929

Source: Home Media Retailing

2006 Top 10 Home Entertainment Sell-Through Titles

by Unit Sales*


Units Sold (MM)

1 Pirates of the Caribbean: Dead Man's Chest Buena Vista $423.3 14.42 Cars Buena Vista 244.1 13.5

3The Chronicles of Narnia: The Lion, the Witch, and the Wardrobe

Buena Vista 291.7 11.4

4 Harry Potter and the Goblet of Fire Warner Bros. 290.0 10.15 Wedding Crashers New Line 209.2 8.46 King Kong Universal 218.1 7.67 Over the Hedge DreamWorks 155.0 7.48 Ice Age: The Meltdown Fox 195.3 7.39 Walk the Line Fox 119.5 7.110 The Little Mermaid - Platinum Edition** Buena Vista n/ a 6.4

* includes both DVD and VHS ** Re-Release


Market Statistics

Page Page 3030

Source: CEA, Digital Entertainment Group, NPD Group

2002 2003 2004 2005 2006

Installed Consumer Base (MM)* 25.1 33.7 37.1 36.7 32.7

DVD Players Shipped to Dealers (MM) 17.1 22.0 20.0 16.1 19.8

DVD Software Units Shipped to Dealers (MM)** 685 1,023 1,518 1,657 1,657

DVD Player Sales to Consumers (MM) 25.1 33.7 37.1 34.4 33.9

Average DVD Player Price (USD) $136 $103 $90 $73 $53

DVD

DVD Statistics

** Includes Sell-Through and Rental DVD

* Includes set-top and portable DVD players, Home Theater in Box systems, TV/DVD and DVD/VCR combination players

Total Average Selling Price for All Players in 2006 = $95 (Includes single DVD, Up Convert, DVD Recorder, DVD/VHS combo, and Portable)


Market Statistics

Page Page 3131

Source: CEA

Month 2005 2006 % Change

January 505,492 686,127 35.7%February 590,128 770,132 30.5%March 1,227,321 1,039,752 -15.3%April 899,389 872,169 -3.0%May 1,184,490 1,441,570 21.7%June 1,288,518 2,074,938 61.0%July 916,495 1,458,099 59.1%

August 1,245,027 1,451,303 16.6%September 2,065,892 2,706,250 31.0%October 2,371,190 2,427,125 2.4%

November 2,246,882 2,673,950 19.0%December 1,606,999 2,186,864 36.1%

TOTAL 16,147,823 19,788,279 22.5%

DVD

DVD Player Shipments to Dealers


Market Statistics

Page Page 3232

Source: DVD Report/Home Media Retailing, Digital Entertainment Group

New DVD Releases

Year New Titles Prev. Period

2006Titles

Available*Prev. Period

2006

2006 13,019 -5.2% - 68,000 51.1% -2005 13,728 13.2% -5.2% 45,000 12.5% 51.1%2004 12,123 17.5% 7.4% 40,000 37.9% 70.0%2003 10,318 39.8% 26.2% 29,000 45.0% 134.5%2002 7,379 30.9% 76.4% 20,000 53.8% 240.0%2001 5,635 42.2% 131.0% 13,000 52.9% 423.1%2000 3,962 44.0% 228.6% 8,500 70.0% 700.0%1999 2,751 80.7% 373.2% 5,000 233.3% 1260.0%1998 1,522 - 755.4% 1,500 - 4433.3%

% Change vs.

DVD

% Change vs.

Total DVD Titles Available

* Titles available on DVD include movies and music videos

Source: Digital Entertainment Group, DVD Release Report

Home Video

Average Price per DVD Title*

$21.02 $20.07 $19.96$21.24

$22.40

$10.00

$15.00

$20.00

$25.00

$30.00

2002 2003 2004 2005 2006


Page Page 3333

45,000 Titles

Available

20,000 Titles

Available

29,000 Titles

Available

40, 000 Titles

Available

68,000 Titles

Available


Source: IDC, Adams Media Research

Home Video

Household Growth: Internet vs. Broadband vs. DVD*

54.0

69.7

95.791.3

84.3

55.459.6

65.1

69.172.3

55.9

45.1

28.826.1

15.9

10

20

30

40

50

60

70

80

90

100

2002 2003 2004 2005 2006

Mill

ions

DVD HHs

Internet HHs

Broadband HHs


Page Page 3434


TelevisionU.S. Entertainment Industry: 2006

Market Statistics

Page Page 3535

Television Households

Source: Nielsen Media Research, Census Bureau

Year

2006 113.4 111.4 98.2%2005 112.3 110.2 98.1%2004 111.3 109.6 98.5%2003 110.3 108.4 98.3%2002 109.3 106.7 97.6%1996 99.6 95.0 95.4%1986 88.5 85.9 97.1%

TV

Total Households (MM)

TV Households (MM)

TV Penetration Rate

(% of Total HHs)


Market Statistics

Page Page 3636

Factory Sales of Digital TV Sets and Displays*

Source: CEA

$23,661

$15,563

$12,300

$8,692

$6,383

$1,540 $1,571 $989$1,369$1,537

$0

$5,000

$10,000

$15,000

$20,000

$25,000

2002 2003 2004 2005 2006**

Sales in Millions

Average UnitPrice

11.4 mil Units

4.1 mil Units

5.5 mil Units

8.0 mil Units

23.9 mil Units


** 2006 figure is an estimate


Market Statistics

Page Page 3737

Basic Cable Households*


% Change Basic Cable HHs

Year Prev. Period 20062006 111.4 71.4 -2.5% - 64.1%2005 110.2 73.2 -0.9% -2.5% 66.4%2004 109.6 73.9 0.0% -3.4% 67.4%2003 108.4 73.9 2.4% -3.4% 68.2%2002 106.7 72.2 -1.4% -1.1% 67.7%2001 105.5 73.2 5.3% -2.5% 69.4%2000 102.2 69.5 11.0% 2.7% 68.0%1996 95.0 62.6 N/ A 14.1% 65.9%1986 85.9 39.2 N/ A 82.1% 45.6%BA

SIC C

ABL

E

TV Households

(MM)

Basic Cable Households

(MM)

Basic Cable Penetration Rate(% of TV HHs)

* Refers to wired cable households with basic cable


Market Statistics

Page Page 3838

Pay Cable Households*


% Change Pay Cable HHs

Year Prev. Period 20062006 111.4 35.6 4.7% - 32.0%2005 110.2 34.0 -3.1% 4.7% 30.9%2004 109.6 35.1 -12.3% 1.4% 32.0%2003 108.4 40.0 16.3% -11.0% 36.9%2002 106.7 34.4 0.9% 3.5% 32.2%2001 105.5 34.1 1.2% 4.4% 32.3%2000 102.2 33.7 10.9% 5.6% 33.0%1996 95.0 30.4 N/ A 17.1% 32.0%1986 85.9 22.8 N/ A 56.1% 26.5%

PAY

CABL

E

TV Households

(MM)

Pay Cable Households

(MM)

Pay Cable Penetration Rate(% of TV HHs)

* Refers to wired cable households subscribing to premium channels


Market Statistics

Page Page 3939

Digital Cable Subscribers

Source: Adams Media Research

4.1

10.0

16.9

21.324.5

27.729.9 32.8

0

5

10

15

20

25

30

35

Mill

ions

1999 2000 2001 2002 2003 2004 2005 2006

9.7%


Market Statistics

Page Page 4040

Satellite Households


% Change

Year Prev. Period 20062006 27.4 22.9% -2005 22.3 0.5% 22.9%2004 22.2 14.4% 23.4%2003 19.4 10.2% 41.2%2002 17.6 36.4% 55.7%2000 12.9 34.4% 112.4%1999 9.6 15.7% 185.4%1998 8.3 29.7% 230.1%1997 6.4 45.5% 328.1%1996 4.4 - 522.7%

SATE

LLIT

E

Satellite Households

(MM)


Market Statistics

Page Page 4141

Video On Demand (VOD) Households*

Source: Nielsen Media Research, Adams Media Research

Year

2006 111.4 29.9 26.8%2005 110.2 27.3 24.8%2004 109.6 16.9 15.4%2003 108.4 9.5 8.8%2002 106.7 6.0 5.6%2001 105.5 2.5 2.4%2000 102.2 0.4 0.4%

VO

D

TV Households (MM)

VOD Households* (MM)

VOD Penetration Rate

(% of TV HHs)

Video on Demand is an advanced pay-per-view programming service which enables viewers to order and watch movies on demand and to

pause, rewind or fast-forward them.


TechnologyU.S. Entertainment Industry: 2006

Market Statistics

Page Page 4242

PC Households

Source: US Census Bureau, IDC

% Change PC HHs

Year Prev. Period 20062006 111.4 78.8 4.6% - 70.7%2005* 112.3 75.3 7.3% 4.6% 67.1%2004 111.3 70.2 6.5% 12.3% 63.1%2003 110.3 65.9 5.9% 19.6% 59.7%2002 109.3 62.2 - 26.7% 56.9%

PC

Total Households

(MM)

PC Households

(MM)

PC Penetration Rate

(% of TV HHs)

* 2005 updated by source


Market Statistics

Page Page 4343

PC Households


78.8

75.3

70.2

65.9

62.2

60

62

64

66

68

70

72

74

76

78

80

2002 2003 2004 2005 2006

Millio

ns

67.1%Penetration

70.7%Penetration

56.9%Penetration

59.7%Penetration

63.0%Penetration

Penetration is calculated as a percentage of total US households


Market Statistics

Page Page 4444

Internet Households


Internet % Change

YearHouseholds

(MM)Prev. Period 2006 % of PC HHs

% of Total HHs

2006 72.3 4.6% - 91.8% 64.9%2005* 69.1 6.1% 4.6% 91.8% 61.5%2004 65.1 9.2% 11.1% 92.7% 58.5%2003 59.6 7.6% 21.3% 90.4% 54.0%2002 55.4 - 30.5% 89.1% 50.7%

Penetration

Inte

rnet



Market Statistics

Page Page 4545

Internet Households


72.3

69.1

65.1

59.4

55.4

50

55

60

65

70

75

2002 2003 2004 2005 2006

Mill

ions

61.5%Penetration

64.9%Penetration

50.7%Penetration

54.0%Penetration

58.0%Penetration

Penetration is calculated as a percentage of total US households


Market Statistics

Page Page 4646

Broadband Households


Broadband % Change BB HHs

YearHouseholds

(MM)Prev. Period 2006

% of Internet HHs

% of Total HHs

2006 55.9 23.9% - 77.3% 50.2%2005* 45.1 56.6% 23.9% 65.3% 40.2%2004 28.8 10.3% 94.1% 44.2% 25.9%2003 26.1 64.2% 114.2% 43.8% 23.7%2002 15.9 - 251.6% 28.7% 14.5%

Penetration

Broa

dban

d



Market Statistics

Page Page 4747

Broadband Households*


55.9

45.1

28.826.1

15.9

15

20

25

30

35

40

45

50

55

60

2002 2003 2004 2005 2006

Mill

ions

40.2%Penetration

50.2%Penetration

14.5%Penetration

23.7%Penetration

25.6%Penetration

Penetration is calculated as a percentage of total US households* Historical figures have been updated by source


Market Statistics

Page Page 4848

Internet Users

Source: IDC

** MOBILE INTERNET USERS – a person accessing the Internet at least once per month from a mobile device that accesses the Internet across a 2, 2.5, or 3G cellular network connections.

2005 2006

US Total Internet Users* (MM) 320.7 348.6

Hrs/ Mo (Total) 45.3 44.2

US Total Internet Hours/ Mo (MM) 14,513.7 15,395.8

2005 2006

US Mobile Internet Users** (MM) 37.1 49.6

Hrs/ Mo (Total) 9.0 9.0

US Total Mobile Internet Hours/ Mo (MM) 333.5 446.0

Mob

ileIn

tern

et

* INTERNET USER – a person accessing the Internet at least once per month through a PC or Internet access device. There is no age limitation for user.

Media Consumption


Page Page 4949

Media Consumption

based on Hours per Person*

Source: Veronis Suhler Stevenson * Historical figures have been updated by source

Filmed Entertainment 2002 2003 2004 2005 2006p 05-06 02-06p Cable & Satellite TV 828 886 909 980 989 0.9% 19.4%Broadcast TV 744 729 711 679 684 0.7% -8.1%Consumer Internet 138 155 165 172 177 2.9% 28.3%

Home Video1 57 60 67 63 63 0.0% 10.5%Box Office 14 13 13 12 12 0.0% -14.3%

In-flight Entertainment & Mobile Content

4 5 8 10 12 20.0% 200.0%

Subtotal 1,785 1,848 1,873 1,916 1,937 1.1% 8.5%

Other Entertainment 2002 2003 2004 2005 2006p 05-06 02-06p Broadcast & Satellite Radio 825 834 821 805 794 -1.4% -3.8%Recorded Music 203 189 195 189 191 1.1% -5.9%Newspapers 196 194 191 184 181 -1.6% -7.7%Consumer Magazines 125 122 125 124 122 -1.6% -2.4%Consumer Books 109 109 108 108 107 -0.9% -1.8%Video Games 71 76 78 73 75 2.7% 5.6%

Subtotal 1,529 1,524 1,518 1,483 1,470 -0.9% -3.9%

Total 3,314 3,372 3,391 3,399 3,407 0.0% 2.8%

% Change

% Change

1 Includes playback of prerecorded VHS cassettes and DVDs only

Media Consumption


Page Page 5050


Note: Advertising refers to broadcast television, broadcast & satellite radio, daily newspapers, consumer magazines. Consumer purchases refer to cable & satellite television, box office, home video, recorded music, video games, consumer Internet, consumer books.

1,7811,7921,8481,8791,890

1,4201,488 1,535

1,597 1,614

1,000

1,500

2,000

2002 2003 2004 2005 2006

Hou

rs p

er P

erso

n pe

r Ye

ar

Media Supported by Advertising

Media Supported Predominately by Consumer Purchases

Media Consumption based on Hours per Person per Year*

Media Consumption


Page Page 5151

Consumer Spending per Person per Year*

(USD)


$47.26 $46.56 $47.38 $47.64 $47.30

$52.76 $49.46 $52.03 $51.18 $52.00

$53.24 $53.62 $51.97 $50.56 $49.65

$74.55 $77.09 $81.41 $81.50 $87.73

$89.57 $91.84 $92.49 $95.62 $97.04

$61.51 $59.72 $59.60 $57.11 $55.84

$108.22 $122.26 $125.45 $115.24 $114.24

$217.43 $236.28 $258.49 $283.21 $306.25

2002 2003 2004 2005 2006p

TV

Home Video

Consumer Internet

Consumer Books

Other

Newspapers

Recorded Music

ConsumerMagazines

Note: TV includes Broadcast TV and Cable & Satellite TV (Basic & Premium services).

Note: Other includes Box Office, Video Games, Mobile Content, Broadcast/Satellite Radio.

Media Consumption


Page Page 5252

Consumer Spending per Person per Year*

(USD)


Note: Advertising refers to broadcast television, broadcast & satellite radio, daily newspapers, consumer magazines. Consumer purchases refer to cable & satellite television, box office, home video, recorded music, video games, consumer Internet, consumer books.

$103.51$101.64$100.63$100.60$100.60

$601.78 $631.67 $660.58 $670.84 $695.56

$0

$200

$400

$600

$800

2002 2003 2004 2005 2006

Media Supported by Advertising

Media Supported Predominately by Consumer Purchases

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