CONFIDENTIAL SPE Service Opportunities Draft 4
Dec 13, 2015
CONFIDENTIAL
SPE Service Opportunities
Draft 4
page 2
Traditional Studio Content and Distribution Businesses are Fragmenting
Studio
User Generated
Games
On-demand
Linear
Broadcast
Cable
Satellite
IP
Wireless
Television
PC
Portable Media Player
Game Console
Mobile Phone
EstablishedEmerging
Content Production Delivery InfrastructureContent Services Playback Devices
page 3
Hypothesis for High Level Focus Areas
Studio
User Generated
Games
On-demand
Linear
Broadcast
Cable
Satellite
IP
Wireless
Television
PC
Portable Media Player
Game Console
Mobile Phone
EstablishedEmerging
Content Production Delivery InfrastructureContent Services Playback Devices
SPE Focus on Content and Adjacent Service Businesses
Third Party Partnerships
Sony Hardware
page 4
Growth Potential by Content and Service Type
Studio
User Generated
Games
Content Production Content Services
2006: $X2009: $XCAGR: X%
2006: $X2009: $XCAGR: X%
2006: $X2009: $XCAGR: X%
Amateur:
2006: $X2009: $XCAGR: X%
“Prosumer”
2006: $X2009: $XCAGR: X%
Linear
On-demand2006: $X2009: $XCAGR: X%
2006: $X2009: $XCAGR: X%
Linear
On-demand2006: $X2009: $XCAGR: X%
2006: $X2009: $XCAGR: X%
Linear
On-demand2006: $X2009: $XCAGR: X%
•Nascent market with early signs of potential–Current / Yahoo! as early entrants–No dominant player in place
•Large, established market with limited growth potential
•No established market, questionable potential
•Early stage with significant growth–Investment focus for studios–Early validation for advertising opportunities
•Early stage with significant growth–Infrastructure now in place–User adoption accelerating
•Continued growth opportunities–Mobile, PC, and console games
Considerations
page 5
Hypothesis for Detailed Focus Areas
• Original short-form (webisodes)
• Repurpose library (2 min minisodes)
• Branded / ad-based
• User-generated
• Prosumer
• Channel extensions (fearnet, GSN)
Content Production
Content Services
• Develop cross-platform sales capabilities
• Hire dedicated new media sales team
• Combine new content and ads for “Syndicator” offering
Ad Sales
• ODE Licensing directly to large, established video services
–Amazon–AOL–CinemaNow–Guba–MovieLink–Sprint
3rd Party Services
• Develop digital video Syndicator service
–Sony and 3rd party video
–Adds
• Leverage relationships with TV affiliates
• Address needs of smaller sites
Affiliate Sites
• Grouper for user generated video
• Grouper / Backlot for “prosumer” video
• Grouper and/or new services for ad-supported and sell-through premium content
Owned Services
page 6
Desired Outcome
By March of 2007, move SPE to a position of leadership in digital media
• Establish new content production capabilities– Create budgets and secure resources for content development– New forms of content in-market
• Develop expertise in cross-platform ad sales– Ad sales for Grouper live (starting January 2007)– Ad sales for licensing partners continue (e.g., AOL)
• Effectively partner with third party services– Continue licensing to third parties– Pending approval, build and launch Syndicator model
• Expand range of owned services– Grow Grouper and enhance functionality– Complete analysis, plan, and (pending approval), build and launch new services
(e.g, Backlot)– Identify new opportunities and be in early stages of building or acquiring
page 7
Questions to Address
All Opportunities(Content, Ad Sales, Services)
Content Production
Ad Sales
• Which new forms of content represent the best opportunity for investment?
• What is the required level of investment to reach critical mass with new forms of content from SPE and third parties?
• How can we ensure that we invest efficiently in new content production?
• Which business models are most attractive (growth, margin, competition)?
• Which opportunities best fit with SPE’s expertise?
• How can SPE best organize to minimize duplication and share common infrastructure and resources across services?
• What incremental investment in headcount and infrastructure is required?
• Which current and new advertisers represent the best clients for cross-platform ads?
• What new forms of advertising are required to best address the opportunity?
page 8
Questions to Address
Services
ODE Licensing
Services
Syndicator forAffiliate Sites
Services
Owned Services
• What investment in licensed or acquired technology is required?
• What is the appropriate mix between SPE and aggregated content?
• How many affiliates are required to make the service economically viable?
• How can SPE best build its affiliate network (e.g., leverage TV affiliates; acquire an established video Synidicator)
• Which services are best addressed by licensing vs. an owned service?
• How can SPE best prioritize licensing partners?
• Which customers (if any) merit preferential treatment (e.g., exclusivity on a subset of content, long-term partnerships)?
• What additional service capabilities should Grouper expand to address (e.g. premium content, prosumer content?) When?
• What additional services should be built as standalone brands (e.g., Backlot)? Can these services leverage Grouper’s infrastructure?
• What additional services should SPE partner or acquire to address?
page 9
Preliminary Timeline
CY 2006 CY 2007October November December January February March
ExistingContent Service Grouper Expand Service
Approved; in PlanningAd Sales Online Ad Sales Detailed Plan Build Capabilities Launch Expand
Content Short-form Detailed Plan Build Capabilities Launch Expand
Identified; Under ReviewAd Sales
Service
Service Backlot Approval Planning Build Launch / Expand
EmergingContentAd Sales TBD Identify Opptys Analyze/Prioritize Approval/Plan Plan Build
Build LaunchSyndicator Approval Planning