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Consumption of video moving from broadcast TV to mobile. Traditional. Broadcast video is in decline. © Copyright 2011. Page 8. Page 9. © Copyright 2011.


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Users now expect all content to be available on any device, at any time.

*Source: Sandvine’s Spring 2011 Global Internet Phenomena Report

NETFLIX

•25M Subs in North America •$7.99 / Monthly Subscription •Unlimited Movies / TV shows •No Advertising •Lack of premium content •~$3B Revenue (2011E) OTHERS…

TV Everywhere © Copyright 2011

Consumption of video moving from broadcast TV to mobile Traditional Broadcast video is in decline

© Copyright 2011

20th Century Fox HBO NBC Universal BBC Disney

Netflix Google

ATT BT

Hulu Amazon

Verizon

Apple

The burden to please the user affects all the links in online video chain

Comcast

Telefonica

Akamai Level3

LimeLight EdgeCast

Faster video! Higher quality! Better content selection! Less Buffering!

© Copyright 2011

Organic Growth (e.g. mobile Internet, mobile broadband, wholesale) Emerging Market Investments (e.g. BRIC countries)

Merger and Acquisition (e.g. Orange–T-Mobile UK, ATT/T-Mobile)

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Niche Market Extension (e.g. M2M, embedded wireless, )

Parallel Market Expansion (e.g. FMC, mobile commerce, media and entertainment)

Estimated Network Service Provider Revenues ($Billions) Video Streaming and Download Revenue

2500

Targeted Online Ad Revenue Managed Telepresence 2000

CDN Services New Services ~20% CAGR

Cloud Computing, PaaS and SaaS Mobile Advertising

1500

Location Based Services Wireless BB Access

1000

Mobile Data Services Digital TV (Cable, IPTV) Managed Business Data (VPN, etc.)

500

Fixed BB Access Legacy Services 0-2% CAGR

0

Mobile Voice Wireline Voice

2009

2010

2011

2012

2013

2014

2015

Sources: Yankee Group Dec 2008, emarketer, April 2009, growth projections Juniper estimates

Operator

Entry strategy

CDN provider or acquisition

AT&T

Own-build

n/a

Bell Canada

Resale

Limelight

BT Wholesale

Own-build

n/a

Deutsche Telekom

Own-build

n/a

Deutsche Telekom ICSS

Partner

Edgecast

France Telecom

Own-build

n/a

Global Crossing

Resale

Edgecast, Limelight

Internap

Acquisition

Vitalstream

Interoute

Acquisition

Virtue Media Services

KPN

License agreement

Jet Stream

Level 3

Acquisition

Savvis

NTT Communications

Own-build

n/a

Pacnet

Own-build

n/a

PCCW Solutions

Own-build

n/a

Reliance Globalcom

Resale

Internap

TATA Communications

Acquisition

BitGravity

Telecom Italia Sparkle

Partner

CDNetworks

Telefonica International Wholesale Services

Own-build

n/a

Telenet

Managed service

Jet Stream

TeliaSonera International Carrier

Resale

Multiple providers

Verizon

Managed service

Velocix

Ziggo

License agreement

Jet Stream

Sources: Companies, Informa Telecoms & Media

6

5.45 4.74

5 4.12 4

3.55 3.01

Revenue (in Billions 3 of US Dollars) 2

2.42 1.64

1 0 2008

2009

2010

2011

2012

2013 © Copyright 2011

2014



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