1 CH
AP
TER
NA
ME
Martin
Lewerth
EVP of Pay-TV
and Technology
Niclas
Ekdahl
CEO
of Viaplay
Born 1973
Joined MTG in 2001
What I love: Being prepared & planning
properly
What I hate: Football
Favourite quote: “It always seems
impossible until its done.”
Born 1970
Joined MTG in 2002
What I love: Football
What I hate: Losing
Favourite quote: “Stand facing the sun and
the shadows fall behind you.”
2
Best in class operating
performance
3
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
2006 2007 2008 2009 2010 2011
Revenue EBIT EBIT margin
(SEK million)
From physical… to digital… to streaming in the ‘cloud’
The entertainment landscape is
changing fast & fundamentally
4
Source: 1) Screendigest
Music
Video
Amazon sold more Kindle books
than paperback books in 2011
Digital music sales accounted
for >50% of total worldwide
music sales in 2011
1.4
3.4
2.6 2.4
2011 2012
Movies online Physical video
Movie viewership in the U.S1
(Number of views /
transactions (bn))
Video is driving IP traffic growth
5
Source: Cisco VNI, 2011
Global IP traffic growth (PB / month)
0
10 000
20 000
30 000
40 000
50 000
60 000
2010 2011 2012 2013 2014 2015
Internet video
File sharing
Web, email, and data
Video calling
Online gaming
Voice over IP (VoIP)
OtherV
ide
o
And the media landscape is
evolving rapidly
6
Broadcasters
Creating order out of chaos
7
Advertising
(free) models
Pay
models
Open
Internet
Walled
gardens
AVOD/Free VOD (advertising)
SVOD (subscription) Closed networks
Proprietary
ecosystems
Existing structures New structures
TVOD (transaction)
91%
83% 74% 73%
Sweden UK US EU-27
15%
7%
1% 1%
Sweden EU-27 UK US
Scandinavia is the cradle of
broadband
Internet penetration
(% of households)1
Internet access speed >30 Mbps 3
(% of population)
Sources:1) Eurostat, OECD (for US, as of June 2011) 2) OECD, June 2011, European Commission (for EU-27); 3) Eurostat, FCC (for US, as of Dec 2010, Tier: <10Mbps,
10-25Mbps, >25Mbps); 4) netindex.com, test data between 29 Apr - 28 May 2012, Solon
24
16 1513
Sweden UK EU-27 US
Average actual download
speeds (Mbps)4
94%
66%
44%
35%
Sweden US UK EU-27
Mobile broadband penetration
(% of population)2
And our strategy is evolving
accordingly
9
Time
Su
bs
cri
be
rs
Pay-TV Life Cycle
Satellite
Virtual
operator Over The Top
Channel
wholesale
Sources: Screendigest, Solon
0
2
4
6
8
10
12
2003 2004 2005 2006 2007 2008 2009 2010 2011
But traditional platforms still
dominate
10
Nordic platform market shares (millions of Households)
Satellite
Digital Terrestrial Analogue terrestrial
IPTV
Cable
3 000
3 500
4 000
4 500
5 000
2006 2007 2008 2009 2010 2011
Satellite is about value growth
not volume growth
11
Nordic satellite premium
ARPU (SEK)
Nordic satellite premium
subscribers (000’s)
0
200
400
600
800
2006 2007 2008 2009 2010 2011
CAGR 6.6 %
CAGR -2.1 %
7%
11%
4%
5%
6%
0%
2%
4%
6%
8%
10%
12%
2007 2008 2009 2010 2011
With consistent price increases
& room for more
12 Source: Viasat Broadcasting research
Sweden price benchmark (SEK) Annual satellite subscription price
increases (Nordic)
200
300
400
500
600
700
800
900
1 000
Viasat Canal Digital
Boxer Telia
SKY UK DIRECTV
Ext. basic Mid tier Mid+movie Total Mid+sport
And rising penetration of add-on
services
13
Sources: Viasat Broadcasting research
Penetration of add-on services, Nordic satellite platform
0%
10%
20%
30%
40%
50%
60%
2007 2008 2009 2010 2011 2012
HD
Multi-room
PVR
Viasat box Viaplay
Multi-screen Viaplay
3D PVRs HD
And we’ve now become a ‘Virtual
Operator’ in 3rd
party networks
14
Sources: Viasat Broadcasting research
0
200
400
600
800
1 000
1 200
2006 2007 2008 2009 2010 2011
DTH satellite 3rd party networks
Viasat premium
subscribers (Nordic)
Scandinavian
satellite
universe
Scandinavian
satellite & Virtual
Operator agreements (IPTV, cable)
~1.6m
households
~4.2m
households
2008 2009 2010 2010 1991
So…how does this look in
profitability terms?
15
YR1 YR2 YR3 YR4
Gro
ss
ma
rgin
DTH Virtual Operator
Indicative schematic
Martin
Lewerth
EVP of Pay-TV
and Technology
Niclas
Ekdahl
CEO
of Viaplay
Born 1973
Joined MTG in 2001
What I love: Being prepared & planning properly
What I hate: Football
Favourite quote: “It always seems impossible
until its done.”
Born 1970
Joined MTG in 2002
What I love: Football
What I hate: Losing
Favourite quote: ”Stand facing the sun and the
shadows fall behind you.”
16
Satellite
1.6 million households
Satellite + Virtual
operator
4.2 million households
Over The Top
9 million households
Viaplay opens up a whole new
universe
17
As we make TV content
available anytime & anywhere
18 TV set-top boxes
Smart TV-sets
Tablets
OTT STB
Game consoles
PC/Mac
Smart phones
With a compelling content
offering
19
At competitive price points
20
49 SEK
99 SEK
199 SEK
OFFERED FOR FREE OR DISCOUNTED TO VIASAT SATELLITE SUBSCRIBERS
That has become the preferred
choice of Swedish consumers
21
With a balanced geographical &
package split
Viaplay by geography Viaplay by package type
22
Available on more and more
smart TVs
23
~40% of TV’s sold are web connected
> 1 million Smart TVs to be sold in 2012
Viaplay soon available on 70% of
Smart TVs
10% of Viaplay subs already use
Smart TVs
* * *
*
* Available via terrestrial signal
*
Viaplay streaming box
Viaplay to your TV
25 linear channels
DTT connection
Full-blown media center
And now we take it a step further
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And with limited cannibalization
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• 24% of Viaplay subscribers have not had Pay-TV subscriptions
before
• 10% have not had Pay-TV subscriptions for the last 6 months
- of which, 50% previously had a Viasat subscription
• So…only 5% of new Viaplay subscribers are potentially
cannibalizing Viasat
• …and 95% do not cannibalize our existing satellite business
So… How does this look in
profitability terms?
26
Indicative schematic
What next?
27
• Make available on increasing number of devices
• Maintain long term premium content leadership
• Roll out Viaplay box
• Enhance content discovery and recommendation
• Enable offline mode
• Expand into new territories
28 CH
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