pdf 14 MB - ProSiebenSat.1
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pdf 14 MB - ProSiebenSat.1
Leveraging business opportunities in TV and distribution Broadcasting German-speaking – TV Germany Thomas Ebeling October 15, 2013 | October 15, 2013 Page 1 We have a strong position in the German TV market Share of viewing Share of advertising [Audience share, in percent] [Gross values, in percent] 32.1 36% owned 28.2 25.4 100% owned 44.0 34.1 50% owned 100% owned H1 2013 H1 2013 Page 2 | October 15, 2013 Basis: All German TV households (Germany + EU), A 14-49 years; Mon-Sun, 3-3 h. Source: AGF in cooperation with GfK / TV Scope / ProSiebenSAT1 TV Deutschland Audience Research Source: Nielsen Media Research ProSiebenSat.1 continues to lead audience share vs. RTL Full day – share of viewing Prime time – share of viewing [audience share, in percent] [audience share, in percent] 27.8 27.3 FY 2012 27.5 28.5 26.3 YTD 2013 28.3 25.6 FY 2012 | October 15, 2013 Adults 14-49, 2012 (01/01/2012-12/31/2012), YTD 2013 (01/01/2013-10/02/2013),Mon-Sun, full day 3-3 h, Prime Time 20.15-23.00 h, RTL Mediengruppe w/o RTL II Base: all TV households in Germany (D+EU) / Source: AGF in cooperation with GfK / TV Scope / ProSiebenSAT1 TV Deutschland Audience Research 25.3 YTD 2013 Page 3 ProSiebenSat.1 ahead of RTL Group since March 2013… Audience shares in commercially relevant target group 14-49 years [in percent] 30 29.7 29.3 29.3 29 27.9 28 27.4 27.2 28.3 28.2 28.1 27.4 + 4.7%pts 27 26.0 26 26.8 27.0 26.9 25 25.5 25.4 25.5 24.5 May 2013 June 2013 July 2013 August 2013 24.6 24.6 24 January 2013 February 2013 March 2013 April 2013 ProSiebenSat.1 | October 15, 2013 Basis: All German TV households (Germany + EU), A 14-49 years; Mon-Sun, 3-3 h.; RTL Mediengruppe w/o RTL II Source: AGF in cooperation with GfK / TV Scope / ProSiebenSAT1 TV Deutschland Audience Research September 2013 RTL Group Page 4 …with leading prime time position even expanded since May Audience shares in commercially relevant target group 14-49 years – prime time [in percent] 31 30 30.5 28.5 29 29.5 29.4 28.3 29.5 28.7 28.2 29.5 28.2 28 27 26.3 + 6.2%pts 26 25 26.0 25.8 25.5 24 23 24.1 22.6 July 2013 August 2013 23.7 23.3 23.2 22 January 2013 February 2013 March 2013 April 2013 ProSiebenSat.1 May 2013 June 2013 September 2013 RTL Group | October 15, 2013 Basis: All German TV households (Germany + EU), A 14-49 years; Mon-Sun, 20:15-23:00 h; RTL Mediengruppe w/o RTL II Source: AGF in cooperation with GfK / TV Scope / ProSiebenSAT1 TV Deutschland Audience Research Page 5 ProSieben with smallest gap ever vs. RTL – SAT.1 with clear leadership vs. VOX Audience shares ProSieben vs. RTL Audience shares SAT.1 vs. VOX Audience shares ad relevant target group 14-49y [in percent] Audience shares ad relevant target group 14-49y [in percent] 18 11 16 10 14 9 12 8 10 0 0 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 | October 15, 2013 Basis: All German TV households (Germany + EU), A 14-49 years; Mon-Sun, 3-3 h. Source: AGF in cooperation with GfK / TV Scope / ProSiebenSAT1 TV Deutschland Audience Research Page 6 Our channels hold strong positions in their relevant target groups Channel Relevant target group [in years] Audience share in relevant target groups [YTD 2013, in percent] F/M 14-39 15.9 9.5 F/M 14-59 5.6 F/M 14-49 2.1 F 14-39 F 40-64 0.5 M 30-59 0.4 | October 15, 2013 Basis: All German TV households (Germany + EU); YTD: 01/01/2013-09/30/2013; ProSiebenMAXX: 09/03/2013-09/30/2013; Mon-Sun: 3-3h Source: AGF in cooperation with GfK / TV Scope / ProSiebenSAT1 TV Deutschland Audience Research Page 7 Prime time ratings driven by new blockbuster entertainment shows… The Voice Ø 23.4% share of viewing (season 2) The Voice Kids Ø 19.8% share of viewing (season 1) | October 15, 2013 Basis: All German TV households (Germany + EU), 14-49 years; Mon-Sun, 3-3h Source: AGF in cooperation with GfK / TV Scope / ProSiebenSat.1 TV Deutschland Audience Research Got to Dance Ø 15.8% share of viewing (season 1) Promi Big Brother Ø 13.9% share of viewing (season 1) Page 8 …and by Germany’s most successful line-up of US sitcoms The Big Bang Theory How I Met Your Mother Two and a Half Men up to up to up to 21.7% 16.8% 16.4% share of viewing share of viewing share of viewing | October 15, 2013 Basis: All German TV households (Germany + EU), 14-49 years; Mon-Sun, 20-23 h Source: AGF in cooperation with GfK / TV Scope / ProSiebenSat.1 TV Deutschland Audience Research Page 9 Almost stable market shares despite increased fragmentation in digitalization Share of viewing bridge: YTD 09/30/13 vs. YTD 09/30/12 [14-49 years; in percent] ProSiebenSat.1 Group rating ProSiebenSat.1 Group rating 27.7 09/30/12 27.6 0.1 -0.1 -0.0 -0.1 -0.1 -0.0 ARD/ZDF (Sport, CL, Wetten dass...) RTL II Sky Basic Pay Digital Public Other | October 15, 2013 Basis: All German TV households (Germany + EU), 14-49 years; Mon-Sun, 3-3 h Source: AGF in cooperation with GfK / TV Scope / ProSiebenSat.1 TV Deutschland Audience Research 09/30/13 Page 10 ProSiebenSat.1 continues to lead commercial universe share vs. RTL Commercial universe: full day [audience share, in percent] 36.9 36.5 36.7 35.5 P7S1 RTL P7S1 RTL YTD 2012 YTD 2013 | October 15, 2013 Adults 14-49, YTD 2012 (01/01/2012-09/30/2012), YTD 2013 (01/01/2013-09/30/2013), only stations >0.5% MA in 2013, public channels only in time zones with advertising Base: all TV households in Germany (GER+EU) / Source: AGF in cooperation with GfK / TV Scope Page 11 TV remains the central fire place for German households TV market trends – Germany Key facts I TV and TV-related consumption continues to dominate total media consumption II TV remains the central fire place as the everyday lean-back medium 78% in company Teenagers do not expect a decline in 88% importance of TV III New TV screens/hardware make watching TV more stirring – and people invest into new TVs 10m HDTVs sold in 2012 New screens make TV for even more special 58% IV Growing VoD market with minimal impact on linear TV – but replacing DVD market 103m EUR VoD market 2012 VoD as percent of | October 15, 2013 205 TV viewing min (+1% growth p.a.) Prefer watching (+53% p.a.) Online Video viewing (+62% p.a.) total video market 20 min 6% Page 12 TV continues to dominate media consumption – Online Video as additional growth opportunity… Average daily usage in Germany [in minutes, 14-49 years] 220 200 TV usage 205 +1% Online (w/o Online Video) 63 +9% Online Video 20 +62% 2013 (min) CAGR 2002-2013 180 160 140 60 40 20 2002 2004 2006 2008 2010 | October 15, 2013 Source: SevenOne Media, forsa, Enigma GfK, mindline media Note: Online since 2008 without passive usage; Online Video: ProSiebenSat.1 estimate 2011 2012 2013 Page 13 …supported by strong growth in new devices Average daily TV/video usage in Germany [in minutes, 14-49 years] 240 Total TV/video 203 221 +1.7% Traditional TV usage 180 161 -2.2% 23 61 +21.5% 2013 (min) 2018 (min) 200 160 120 Video over OTT (connected TV/PC/ mobile/tablet) 80 40 0 2013E 2014E 2015E 2016E 2017E | October 15, 2013 Source: SevenOne Media, forsa, Enigma GfK, mindline media Note: Online since 2008 without passive usage; Online Video: ProSiebenSat.1 estimate CAGR 2013-2018 2018E Page 14 In the young target group TV is still the lead medium with stable consumption – online growing dynamically Average daily usage in Germany [in minutes, 14-29y] 160 140 TV usage 146 -1% Online (w/o Online Video) 90 +20% Online Video 30 +126% 2013 (min) CAGR 2002-2013 60 40 20 0 2002 2004 2006 2008 2010 2011 | October 15, 2013 Source: SevenOne Media/mindline media 2013; Online since 2008 without passive usage Online video usage: SevenOne Media/mindline media 2013; before 2012: ProSiebenSat.1 estimate 2012 2013 Page 15 TV is lead medium in reach and usage Monthly net-reach and usage duration [total population, excl. mobile usage, in percent] 100 TV Total 50 0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 | October 15, 2013 Source: AGF/GfK, TV Scope 5.0 (vierwers +3y), Comscore (Internet Home + Work, excl. mobile usage; +6y), Jan 2013, own calculations Wirkstoff TV, SevenOne Media / mindline media 2012 (print +14y) 170 Usage duration [hrs per month] Page 16 Global OTT players attack market – but most likely cannibalizing physical DVD consumption Key strategies/activities • • Youtube with niche content strategy (<USD 200m invest) Google Play store as iTunes ‘me-too’ • • Focus on seamless user experience & selling hardware TV set rumor – Potential deals with Disney/ESPN/HBO for TV subscriptions • • Bundling deep library streaming of TV/Video content into Amazon Prime Additional TVoD/ EST sales (similar to iTunes) • • Early 2013 – old CEO announced plans for web-based Pay TV service Now – new CEO with focus on mobile, less optimistic about Pay TV service • Streaming service with largest on-demand library and 29m subscribers • Exclusive titles like Mad Men and strong original content like ‘House of Cards’ • ‘sky Go‘ – mobile/multi-device access to sky content for existing subscribers • ‘skyflix‘ rumor – sky to potentially launch streaming service in Germany | October 15, 2013 • Access of OTT players to fresh exclusive studio content unlikely • Prices for exclusive content sometimes 5x higher than for non-exlusive • Physical DVD consumption most likely to be cannibalized Page 17 Market fundamentals in USA and Germany are very different USA Germany HH TV spend Monthly HH spend for TV: USD 951) – big savings potential through cord-cutting Monthly HH spend for TV: EUR 302) – low savings potential through cord-cutting Ad break intensity No ad break regulations in USA – high intensity (15-20 min/h) and frequency, driving usage of ad skipping Ad breaks highly regulated in Germany – lower intensity (max 12 min/h) and frequency Channel fragmentation Basic TV package incl. >500 channels – due to diversity of ethnical groups & interests Less fragmented/strong lighthouse channels – due to lower social diversity Content quality in Free TV High-quality & top-sport content not in basic TV service – Pay TV a ‘Must Have’ >50 high/good quality channels in FTA w/ top US & sport content alongside private channels Illegal viewing Commonly used – especially streaming Limited due to German language dubbing – most illegal content only in English Power of domestic content and local hosts Many creative, local authors and formats Few local ‘Must See’ hosts – licensing of international content and formats critical Language Native language Dubbed version | October 15, 2013 1) Monthly averages 2012; 2) thereof EUR 18 obligatory; Source: Nielsen, ProSiebenSat.1 internal research (SevenOneMedia) Page 18 Premium Pay TV threat very minor Key Sports Events • Majority of mass market sports events covered by public broadcasters and ProSiebenSat.1/RTL • Sky only covers premium rights for selected events (e.g., soccer premier league) • Majority of blockbuster movies and top US series secured by ProSiebenSat.1/RTL Top US Content • Pay TV monetization of US content not yet proven – sky with very limited coverage Value proposition of Pay TV/Sky relatively weaker in Germany – • Ad-based monetization for studios more important than Pay TV model in Germany especially for • German viewers prefer dubbed version mass market Local • Limited number of local stars Content | October 15, 2013 Page 19 Fragmentation of market will continue – however relevant set will remain stable Broadcast stations received and in 'Relevant Set' 90 82 73 63 52 41 5 6 6 6 6 6 2004 2006 2008 2010 2012 2015E Ø number of receivable channels Ø number of Relevant Set channels (>80% of TV usage time) | October 15, 2013 Adults 14-49 years 'Relevant Set': channels which draw at least 80% of TV usage time, basis: All TV households Germany [D+EU] Source: AGF/GfK Fernsehforschung / TV Scope, SPSS / GfK, ProSiebenSAT1 TV Deutschland GmbH / Audience Research [TH], 2015 own estimate Page 20 Key strategic actions to secure attractive future for our TV business 1 Launch attractive, well targeted new channels 2 Establish leading market position with key channels/have must see TV formats 3 Create outstanding linear content (talk-of-nation, live, quality) 4 Establish strong serial formats 5 Provide top US content at reasonable cost 6 Secure distribution everywhere at lowest cost/maximize distribution income 7 Provide new audiovisual thematic content offerings (e.g., smart channel app project) 8 Lead in TV 3.0 (ping-pong TV-Online) 9 Increase recycling ability & effectiveness (fiction, entertainment, reality) 10 Establish new low-cost content categories (e.g., Bollywood, Asian, Turkish) | October 15, 2013 Page 21 1 We are well positioned to capture all segments of German TV viewers Positioning by age and gender [structural share] male young old female | October 15, 2013 Structural shares M 14+ and A 14-49 on base A 14+, full 2012, 3-3 h In percent / base: all TV households in Germany (D+EU) / Source: AGF in cooperation with GfK / TV Scope / ProSiebenSAT1 TV Deutschland Audience Research Page 22 1 We cover a broad range of advertising customers and segments… Consumer target group Channel 1) Competition Customer segments A 14-39 RTL/VOX/RTL 2 Business services, telecommunication, beverages A 14-59 RTL/VOX Food, cosmetics & toiletries, trade & shipment A 14-49 RTL 2/VOX Motor vehicles, beverages, business services F 14-39 FTA/female magazines Trade & shipment, cosmetics & toiletries, beverages F 40-64 Print/public TV Cosmetics & toiletries, motor vehicles, pharmacy M 30-59 RTLNitro/DMAX Motor vehicles, trade & shipment, finance M 6-13 Male kids TV Toys, games, education, music, entertainment | October 15, 2013 1) During day-time we show Yep! on ProSieben MAXX Page 23 2 …driven by strong positions in key genres, built on ‘must see’ TV formats • Leading US crime series • Prime time entertainment • Emotional reality shows • Leading entertainment comedy hosts • Blockbuster prime time entertainment • US classic movie blockbusters • US crime fiction on afternoon • Soccer Europa League | October 15, 2013 Page 24 2 ProSiebenSat.1’ s six most successful ‘must see’ TV formats The Voice The Voice Kids Germany‘s Next Topmodel Got to Dance Promi Big Brother Schlag den Raab | October 15, 2013 Page 25 3 Outstanding linear content The Voice The Voice Kids Got to Dance TV Award 2013 Leading Kids Casting Show TV Award 2013 Leading Dance Casting Show Germany‘s Next Top Model Raab Joko & Klaas Leading Model Casting Show Leading German Entertainer Next Generation German Entertainer Talents | October 15, 2013 Page 26 4 Increase number of serial formats in key slots Day time/access time Prime time Local crime fiction series in line-up 3 US series evenings US sitcom 3 sitcom/comedy evenings US crime series Very stable grid (series/movies) US female series Stable grid with US series | October 15, 2013 Page 27 5 Top US content secured… | October 15, 2013 Page 28 …to deliver a balanced mix of US and local content 5 ProSiebenSat.1 Group content break-down News, Magazines & Sports [in percent of total hrs] • • • Reality • Reality Blockbuster (e.g. Biggest Loser, Schwer verliebt) #1 breakfast television (SAT.1 Frühstücksfernsehen) Leading boulevard & lifestyle shows (taff, red!) #1 science show (Galileo) 15% 20% Film International • Entertainment • • #1 casting show (The Voice/Voice Kids) #1 competition show (Schlag den Raab) Film & Series National • • Top series (Der letzte Bulle) Talk of town formats (e.g., Der Minister) Commissioned content Licensed content | October 15, 2013 Deals with major studios Warner, 20th Century Fox, Paramount, Dreamworks, Constantin, Regency 10% Series International 36% 9% 8% • • • Top crime series (Navy CIS, Criminal Minds, Elementary) Award winning series (Homeland) Leading in sitcoms (Big Bang Theory, Two & a Half Men) 2% Animation • • Long-running cult series (e.g., Simpsons, Family Guy) Trick-series (Warner & Yep) Page 29 6 Growth through new distribution opportunities ProSiebenSat.1 apps Mass distribution partners • Launch of ProSiebenSat.1 mobile/Smart TV apps • Free catch-up content • Live streaming of channels (pay) • Partnerships with telco and cable networks to integrate ProSiebenSat.1’s channels in Live-TV streaming offerings • Bundle packages/offerings • CPS/revenue share participations TV app specialists • Integration of ProSiebenSat.1 channels in universal TV streaming apps (e.g., zattoo, Magine) • CPS revenues and ad sales partnerships (SOM) | October 15, 2013 Page 30 7 Launch app based smart channels Approach/ business model Content/ topic areas Distribution platforms • • • • App-based channels Freemium – free ad financed version with in-app upselling Attractive for special interest print customers Push through TVD cross-promo/trailer and SEM/Facebook • Print media relevant content topics • Low-cost content from, e.g., MCN and TV recycling • On-demand grid/fresh monthly content • Low cost distribution (digital platforms) | October 15, 2013 1) Brands illustrative Example lifestyle & luxury app Female/male, 14-59y net income >EUR 3,000 In-App eCommerce ‘Get the Look’ Premium coops with 5 licensing brands1) Page 31 8 Further leverage TV 3.0 ping-pong to drive reach and engagement/loyalty to formats 1 Online first – broadcasting premier on online platform strengthens TV performance/ratings 2 Promoting an online show through integration of TV moderator in web-show 3 Give semi-professional webstars opportunity to be integrated in TV shows 4 Show promotional trailers for websites on TV 5 Do casting for free-to-air shows supported by online activities 6 Second screen (interactivity) 7 Additional information to shows | October 15, 2013 Page 32 9 Explore creative ways even better to leverage existing content Improve re-run ability Driving multi-channel usage of formats Content exchange management in factual & entertainment New windowing Leveraging digital channels | October 15, 2013 Page 33 9 More reach through multi-platform content exploitation example ‘Spartacus Vengence (season 3)‘ season 1-3 VoD connect community check-in VoD w/limited time span VoD current episode .de VoD current episode VoD current episode Quick repeat season 1-2 VoD Free-TV season 3 season 1-2 VoD Teaser clips .de PRE | October 15, 2013 ON POST Page 34 10 Establish new and cheaper categories Bollywood/Turkey China/Asia Webstars shows New reality production style Blockbuster documentary Improve marketing/ sales execution of sports/live events New cheaper sport live events (e.g., city-runs) | October 15, 2013 Page 35 Summary 1 TV will remain lead medium – TV everywhere is booming 2 ProSiebenSat.1 with leading full day and prime time audience shares 3 ProSiebenSat.1 well positioned to capture all segments of TV viewers – driven by attractive channels and Blockbuster content 4 Key strategies in place to further optimize efficiency of program investments | October 15, 2013 Page 36 Leveraging business opportunities in TV and distribution Broadcasting German-speaking – Sales Strategy Thomas Ebeling October 15, 2013 | October 15, 2013 Page 37 ProSiebenSat.1 with strong performance in 2013 YTD 2013 ∆ vs. 20121) TV share of advertising market (net)1) 27.9% +0.7%pts Share of advertising ProSiebenSat.1 (gross) 44.1% +1.8%pts Universe share of advertising vs. RTL (gross) 56.6% +1.9%pts EUR 10.6 +EUR 0.4 Net CPT | October 15, 2013 1) 2013 FY est. vs. 2012; Source: ZAW e.V. / SevenOne Media, Market Insights, Revenue Management estimate: TV spendings, excluding direct mail and directories Source gross: Nielsen Media Research YTD (Jan.-Aug.), Source net CPT: AGF/GfK, TV Scope, SevenOne Media, Pricing & Media Strategy, own calculation Page 38 Development of net TV advertising market share 2008-2013 TV advertising share of total ad market (net) [in percent] 30 28 27.9 27.9 27.2 26 24 26.3 24.8 25.0 2008 2009 26.0 22 20 2010 2011 2012 2013E | October 15, 2013 Source: ZAW Zentralverband der deutschen Werbewirtschaft e.V. / SevenOne Media, Market Insights, Revenue Management estimate: TV spendings, excluding direct mail and directories Page 39 TV is the most effective medium TV is the most effective medium (TV advertising recall 2.4x higher than print) – with daily reach of 49m viewers TV is the dominant medium to reach mass markets TV is the most efficient medium: Ø-net CPTs for TV advertising are at 50% compared to print and online pricing Attractive ROI1) of TV advertising leads to continuous growth of advertising share gains (Ad shares 2012 vs. 2011 – TV: +0.5ppt. vs. Print: -2.3ppt.) TV ad intensity in Germany at 39% of US level and significantly lower than in key markets in Western Europe – substantial growth potential by closing the gap | October 15, 2013 1) additional sales revenues/TV ad spend Page 40 TV is the most effective and efficient medium for advertisers in Germany… Highest effectiveness Attractive pricing Advertising effectiveness Net CPT ranges [Aided advertising recall, index 100=without contact] [EUR] TV 50 40 442 InStream Video 367 InPage / Display 15 25 15 10 190 5 Print 0.5 166 0 100 200 300 400 500 TV Newspapers Magazines Page 41 | October 15, 2013 Basis: n=200, 14-64 yrs; 4 tested advertising campaigns per medium; Source: eye square 2012 Online Source: SevenOne Media estimate; CPT = Cost per thousand …and generates high long-term ROIs Based on 110 analyzed FMCG brands 2.1 Average long-term ROI | October 15, 2013 ‘Long-term ROI’: ROI after 5 years, ROI = ratio of additional sales revenues / TV ad spend Source: GfK / SevenOne Media Based on a TV investment net / gross ratio of 43% 62% of all analyzed brands long-term-ROI >1 36% analyzed brands with long-term-ROI 2.0-9.0 Page 42 High-impact research projects will support proof of superiority of TV Research project 1 Proof of long-term ROI of TV advertising for sustainable brand success 2 Proof of TV as the considerably more effective ad medium vs. print 3 Proof of eroding brand effects for below-the-line and promotion activities 4 Proof of TV advertising as driver for online success (e.g., eCommerce) 5 Proof of outstanding effect of TV/Online video media mix on reach & impact | October 15, 2013 Strategic objective Strengthening TV share vs. other media Gaining advertising share from print Regaining promotion budget for TV Winning online customers for TV Increasing video share in media mix Page 43 Large customers shift budgets back to TV and increase their overall ad spend Jan-Aug 2013: Top 20 Top 21-50 Other | October 15, 2013 Source: Nielsen Media Research Δ Nielsen gross TV spendings Δ TV share (in pp) 1.8% 2.3 10.6% 8.0% 3.1 1.5 Page 44 Potential economic recovery in Europe might lead to catch-up effects of European advertisers by 2014 Nielsen gross TV spendings of Top 50 customers per segment [in percent, Jan-Aug 2013] National 9.9% European -8.0% Global | October 15, 2013 Source: Nielsen Media Research, Jan-Aug 2013 9.7% Page 45 eCommerce companies spend 70% of their advertising budgets on TV YTD 2013 media budget split of German eCommerce companies [in percent] Others Print TV 6% 8% 16% 70% 70% advertising share: TV is the most effective medium to grow eCommerce companies Internet | October 15, 2013 Source: Nielsen Media Research, Jan-Aug 2013 Page 46 ProSiebenSat.1 with well-balanced and diversified customer base of more than 500 customers Customer split 2013 [in % of revenues] 1 Large customer base with more than 500 customers from various industries Other customers <25% 2 Top 100 customers >75% Diversified customer base – biggest customer <3.5% of total revenues 3 Successful acquisition of new customers – YTD 2013 >20% new customers vs. 2012 ∑ Customers: 500+ | October 15, 2013 Page 47 German TV market potential – balanced risks and opportunities PRINT Market potential 2018 vs. 2012 [in EURm] Market base case Add. market upside Market risks 1 Print cannibalization – structural effect 170 30 - 2 New channels – expand target groups 30 - (15) 3 App channels/2nd Screen/HbbTV 10 10 - 4 Regional/local advertising 50 - (50) 5 Individualized targeting 10 40 - 6 TV/Online combos 15 55 - 7 Pricing opportunities 80 - - 8 New markets (e.g., betting) 70 - (20) 9 Product placement/new ad concepts 50 - - 10 Ban public sponsoring/advertising1) 10 50 - 11 Shift to online/video display (65) - (100) 12 Shift to emerging markets (30) - - ∑ 400 (CAGR +1.7%) ∑ 185 ∑ (185) | October 15, 2013 1) Impact only on private TV market Page 48 TV share of total ad market will increase – as relation between usage and ad spend continues to normalize 1 Usage vs. net media mix Germany 2013 Net media mix Germany, 2000, 2012 and 2018E [in percent] [in percent] TV 5% Print 54% 66% 54% 44% 35% 27% 24% 27% 30% Usage Net media mix share 2000 2012 2018E 1ppt increase in media mix equals ~EUR 60m for P7S1 | October 15, 2013 Source net media mix: ZAW, since 2007 SevenOne Media estimate, excluding direct mail and directories, Online including display (banner and video), excluding Search and affiliate Source: Media usage 2013 (n=1,010) | mindline media, SevenOne Media Page 49 Print with significant loss in reach and circulation 1 Trend of reach and circulation [in percent and in K] Magazines Newspapers 70 -23.9% circulation 104.4 110 98.5 65 100 178.7 -13.4% reach 96.7 100 -10.2% circulation 180 172.4 90.5 60 -2.8% reach 164.7 95 161.5 170 160.6 90 90 160 55 80 85 150 50 70 80 140 60 75 79.4 62.8 60.7 59.0 56.9 54.4 45 2009 reach 2010 2011 2012 2013 93.7 93.8 93.2 92.8 91.1 130 2009 2010 2011 2012 2013 circulation | October 15, 2013 Page 50 Newspapers – Basis: A 14-49 (pot. 35.20m) – 2009, A 14-49 (pot. 38.93m) – 2010, A 14-49 (pot. 38.39m) – 2011, A 14-49 (pot. 37.88m) – 2012, A 14-49 (pot. 37.47m) – 2013 Source: ma 2009 Presse II + ma 2010 Presse II + ma 2011 Presse II + ma 2012 Presse II + ma 2013 Presse II; www.ivw.de / SevenOne Media GmbH, Media Strategy & Analytics Magazines – Basis: A 14-49 (pot. 35.20m) – 2009, A 14-49 (pot. 38.93m) – 2010, A 14-49 (pot. 38.39m) – 2011, A 14-49 (pot. 37.88m) – 2012, A 14-49 (pot. 37.47m) – 2013 Source: ma 2009 Presse II + ma 2010 Presse II + ma 2011 Presse II + ma 2012 Presse II + ma 2013 Presse II; www.ivw.de / SevenOne Media GmbH, Media Strategy & Analytics 1 ~EUR 3.4bn German gross print spendings directly addressable as core TV advertising market Print & direct mail gross advertising market 2012 (in EURbn) Professional/ magazine Direct mail 12.4 3% 5.6 Direct mail (partly) addressed -22% Media 27% Classified advertising Magazines -15% 29% -2% 2.4 -7% -12% -7% Other* Daily newspapers Direct mail not addressed 0.4 -3% Commercial adv** (daily newspaper) 0.6 -5% 3.4 41% Total (gross) not directly addressable Potential from ad allowances Regional potential Local potential | October 15, 2013 *Other: B2B, total spendings <200kEUR, Tobacco, partly commercial advertising in daily newspapers; **Commercial advertising: commerce, mail order selling, building trade Source: Nielsen Media Research (2012) / SOM Market Insights: own calculation Core TV market potential Page 51 1 TV and Online expected to gain share from print within total media mix Total media budgets (net) EURm, media mix SoA in % 18,531 14,120 14,062 14,043 14,051 14,119 14,203 4.0% 4.0% 5.3% 6.4% 5.4% 6.5% 5.5% 6.7% 5.7% 6.8% 5.7% 5.8% 6.9% 7.0% 9.6% 8.3% 9.0% 9.9% 10.6% 11.5% 12.4% 13.9% 13.7% 13.4% 13.1% 12.8% 12.5% Trade Journals 6.0% 5.9% 5.9% 5.8% Magazines 8.4% 8.0% 7.7% 7.3% 5.7% 7.1% 5.6% 6.8% 23.1% 22.1% 21.0% 20.2% 19.5% 18.8% 24.4% 27.9% 28.6% 29.3% 29.7% 30.1% 30.3% 2000 2013 2014E 2015E 2016E 2017E 2018E Cinema Radio Outdoor Online 6.8% Freesheets 12.1% Dailies TV 37.2% 37.5% | October 15, 2013 Excl. direct mail/directories Source: ZAW Zentralverband der deutschen Werbewirtschaft e.V. / SevenOne Media, Market Intelligence, Revenue Management own estimate (Status: 25.05.2013) 2013–18 31.6% -5.9%pts +2.4%pts Page 52 2 New channels help to increase TV ad market by winning new customers (typically at the expense of print) SAT.1 Gold sixx Fashion Sports equipment Food/ beverages Luxury Cosmetics Others Others | October 15, 2013 Source: ProFil, 07/13/2013; Selection of clients; New Business, Sales International Page 53 3 Building a new digital TV response portfolio Digital Real-time interaction with TV shows = revenues from real-time ads and sponsors TV app connection Retail and POS product push, retail coupons (e.g., connected to retailer) TV retail extension Optimized search advertising in real-time with TV spots (max. conversions) TV triggered search Brand engagement, lead generation, sample distribution, brand coupons TV brand extension by Extension | October 15, 2013 Page 54 3 TV SMILES is unique response channel for TV spots TV SMILES • Allows interactivity for TV spots • Extends TV spots for brand engagement, detailed product info, lead generation & couponing • Uses state-of-the-art audio recognition technology (spot detection works on all channels) • Makes TV ad windows more attractive and reduces zapping • Rewards users with Smiles - which can be redeemed for attractive prices • Underlines P7S1 innovation leadership | October 15, 2013 Page 55 4 Regional advertising: expanding into new client segments Rationale • Highly attractive market with EUR 416m gross ad potential • EUR 100m gross ad spend directly addressable with regional TV advertising • Strengthening of television in regional media mix Concept of Implementation • • • • 5 regions via cable distribution on 3 stations (test markets) National airing of regional spots Evaluating targeted advertising via IP address Examinating advertising in regional windows | October 15, 2013 Page 56 7 Net CPT success story since 2009: 30% increase… Net CPT development [Index: 2007=100] 120 SevenOne Media (ProSiebenSat.1 Group) Market IP (RTL Group) 110 100 90 80 2007 2008 2009 | October 15, 2013 Basis: all TV-hh (GER+EU), TA 1-30, Jan-Aug 2013 Source: AGF/GfK, TV Scope, SevenOne Media, Pricing & Media Strategy, own calculation 2010 2011 2012 2013* Page 57 …but still relatively cheap 7 TV Germany vs. other media Net CPT ranges [EUR] TV Germany vs. other markets Ø Net CPT 20“ A 14+, normed (2012) [EUR] 50 5.40 40 4.10 15 25 15 3.80 3.80 10 5 TV 2.30 0.5 Newspapers Magazines Online | October 15, 2013 Source: Nielsen/Auditel (I), Infoadex/Sofres (E), DDS (UK), ZAW/AGF GfK (GER), IREP/Mediametrie (F) UK France Italy Germany Spain Page 58 7 US market role model for price increase – despite increase of fragmentation and loss of reach Revenues, CPT, viewing share prime time‚ network channels [in USDm, index: 1995=100] 16 13.38 14 11.65 12 10 400 300 350 280 14.05 12.65 CPT development Germany vs. US [index: 1995=100] 260 300 240 9.58 250 220 8 200 200 6 150 180 4 100 2 50 0 0 160 140 1995 Revenues 2000 2005 CPT 2010 120 100 2012 Viewing share prime time | October 15, 2013 Basis: Germany (SAT.1, ProSieben, RTL, kabel eins, Vox, RTLII, S-RTL, ARD, ZDF), USA (ABC, CBS, NBC) Source: TV Dimensions 2013, AGF in cooperation with GfK Germany USA Page 59 8 Betting/gambling: unique opportunities to tap into new business segments • Highly attractive market with EUR 140m gross ad Rationale spends and sales revenues of EUR 10bn • TV ads legally not allowed until alteration of Interstate Gambling Treaty • Despite change in treaty, ad permissions only Prerequisites granted for lottery clients to date • For betting, moderate sponsoring is tolerated • Licenses for betting expected for H1 2014 | October 15, 2013 Page 60 Innovative ad and sales concepts drive TV ad growth by delivering superior ad impact for customers 9 Products 1 Product placement/ branded entertainment Integration in editorial contents on all platforms Premium pricing/on-topinvestments 2 3 360° concepts Customized concept (TV & Online) High brand fit between content and brand 4 Thematic ad breaks Special packaging Exclusive positioning as short break Premium pricing Theme weeks/days Tailor made program Program sponsoring, special ads and licenses Tailored advertising formats/concepts drive stronger customer relationships On-top customer budgets through innovative sales concepts/special ads, combining TV & digital | October 15, 2013 Page 61 9 Branded entertainment with ‘Fashion Hero Show’: product placement of Asos, Karstadt and S.Oliver | October 15, 2013 Page 62 9 Digital placement technology starts in Q3 with ‘The Voice of Germany’ and fiction program Physical placement Digital placement Wider capitalization & expansion of target customer through short-term product placement Different levels of integration during production Subsequent integration in postproduction On-Set, In-Use or In-story Technology: MirriAd | October 15, 2013 Increase of existing activities, especially in fiction programs Page 63 Expand 360° concepts 9 Sponsoring Product Placement Sweepstakes On-the-Ground TV-Spot Testimonial Social Media Point of Sale Online License Connect Print | October 15, 2013 Mobile Page 64 9 Sales innovations: new ad forms for better ad impact – special thematic ad breaks Green break Beauty stars Focus on environmental protection and sustainability For customers from the beauty, luxury, fashion or lifestyle segment | October 15, 2013 Men's finest For ‘men specialized products’ such as cars, technology products Perfect balance For health products, health food, sports goods Page 65 9 Theme days with high audience and advertiser relevance GreenSeven Red Nose Day Documentaries, movies and magazines raise the awareness for environmental topics When kids suffer, it's up to all of us to help donations go directly to youth assistance projects | October 15, 2013 Wedding Day sixx celebrates the first wedding anniversary of Prince William and Princess Catherine with romantic movies for the whole day Tolerance Day Stars brought together in a TV and social media campaign to encourage mutual respect Page 66 Summary 1 P7S1 with strong performance in 2009-2013 – outperforming TV ad market 2 TV ad market with further growth potential – mainly driven by gains from print and pricing opportunities 3 Innovative ad sales concepts drive share growth – new digital TV response portfolio in development | October 15, 2013 Page 67 Leveraging business opportunities in TV and distribution Broadcasting German-speaking – Success story Austria Markus Breitenecker October 15, 2013 | October 15, 2013 Page 68 9 Austrian TV advertising market with positive development from 2007 to 2013 TV advertising share of total ad market (gross) [in percent] 30 28 26.3 26 25.8 24 24.2 23.9 24.2 24.8 23.6 22 20 2007 2008 | October 15, 2013 Source: Media Focus 2007–2013, ProSiebenSat.1 Austria 2009 2010 2011 2012 2013 Page 69 Our key strategies 1 Local focus • Austrian ad and program windows • Exclusively Austrian channel PULS 4 2 PULS 4 success factors: local content • UEFA Champions League • Top casting shows: Austria’s next Topmodel, Kiddy Contest, Herz von Österreich 3 Distribution USP due to preferred position on all platforms • Pre-positioning on remote controls, sat receivers, digital TV sets and cable networks • Austrian program windows secure advantages vs. RTL group 4 Local strong sales organization • SevenOne Media Austria No. 1 sales house • New: Digital and SevenVentures Austria | October 15, 2013 Page 70 15 years of growth – our major milestones towards rating leadership Share of viewing ProSiebenSat.1 Austria [in percent] 25 Outlook 20 15 launch ad windows Start 10 1st season 5 launch program windows 0 1998 2000 2001 2004 2007 2008 | October 15, 2013 Source: AGTT/GfK TELETEST; Evogenius Reporting 03/16/1998-08/31/2013, person-weighted. 2010 2011 2012 2013 2014 Page 71 Market development: we are the only Group with considerable and continuing SoV growth Audience share, 12-49 years [in percent] 35.4 32.9 29.2 28.0 20.1 17.3 12.2 13.5 WITH Austria content strategy 21.2 NO Austria content strategy 14.2 11.7 11.1 3.7 5.0 5.0 5.3 0 0 0.7 2007 2009 2011 | October 15, 2013 1.3 YTD 2013 Page 72 Basis: Whole Austria Timeframe: 01/01/2007 -09/30/2013; Mo.-Su.; 03:00-03:00h; P7S1P4 Group: PULS 4 (since 01/28/2008), sixx Austria (since 07/03/2012)// ORF: ORF 1, ORF 2, ORF III, ORF Sport+ (since 2012)// Servus TV (since 2010)// RTL-Group // ATV-Group: ATV 2 (since 2012). Source: AGTT / GfK: Fernsehforschung/ Evogenius Reporting ProSiebenSat.1 PULS 4: We have the highest SoV gains 2013 Audience share YTD 2013 vs. YTD 2012, 12-49 years [in percent] 30.0 21.0 28.0 21.2 13.6 11.7 4.8 YTD 2012 YTD 2013 | October 15, 2013 YTD 2012 YTD 2013 YTD 2012 YTD 2013 5.3 YTD 2012 YTD 2013 Page 73 Basis: Whole Austria, Timeframe: YTD: 01/01/2012-09/30/2013 vs. 01/01/2012-09/30/2012; Mo.-Su.; 03:00-03:00h; P7S1P4 : ProSieben Austria, SAT.1 Austria, kabel eins Austria, PULS 4 ; sixx Austria // ORF: ORF 1, ORF 2, ORF III; ORF Sport +// ATV-Gruppe: ATV, ATV 2 // RTL-Gruppe: RTL Austria, RTL II Austria, VOX Austria, SRTL Austria. Source: AGTT / GfK: Fernsehforschung/ Evogenius Reporting (MM) PULS 4: On the way to becoming Austria’s No. 1 private TV channel Audience shares 12 years+ [in percent] Audience shares 12-49 years [in percent] 3.7 4.0 3.3 3.5 PULS 4 already ahead of RTLII, SuperRTL and VOX Austria 3.3 2.8 2.2 1.5 1.4 0.5 2008 2009 2010 2011 2012 2013 | October 15, 2013 Basis: left graphic: Whole Austria, Timeframe:28.01.2008-30.09.2013 Mo.-Su.; 03:00-03:00h; right graphic: Whole Austria, Timeframe: 01.01.-30.09.2013, Mo.-Su.; 03:00-03:00h; Source: AGTT / GfK: Fernsehforschung/Evogenius Reporting (CG) Page 74 Sales: ProSiebenSat.1 PULS 4 SoA market leader Share of advertising [in percent] 58.9 51.4 42 16 40.6 32.9 22.1 18.5 20.4 34.1 34 35.3 35.3 25.4 30.3 32.2 33.9 22.4 23.5 21.6 19.8 19.8 14.1 2007 2008 2009 | October 15, 2013 Source: Mediafocus 2007–2012; *YTD 2013: 01/01/2013–08/31/2013 2010 2011 2012 33.9 YTD 2013* Page 75 PULS 4: current program highlights and promising upcoming projects 751,500 viewers more than 1,000 applications 351,000 viewers more than 500 | October 15, 2013 applications Page 76 Summary Austria 1 TV ad market with further growth potential – mainly driven by gains from print and pricing opportunities 2 ProSiebenSat.1 PULS 4 is the only Group with continuing SoV growth and highest SoA gains: market leader way ahead of RTL Group 3 Key strategies: ProSiebenSat1 Austria with focus on local content, PULS 4 to remain No.1 TV and Video Network Sales House 4 PULS 4 growth driver, new digital business with SevenVentures Austria | October 15, 2013 Page 77 Leveraging business opportunities in TV and distribution Broadcasting German-speaking – Distribution Conrad Albert October 15, 2013 | October 15, 2013 Page 78 Making profit in 2013 – set for continuous growth • Core distribution business with continued strong revenue and profit contribution • Growth from break-even to double-digit recurring EBITDA (EURm) • Delivery of recurring EBITDA margin at double-digit level • Strong subscriber growth in HD, both in Free and Basic Pay TV • New business opportunities identified, e.g., mobile distribution | October 15, 2013 Page 79 Leveraging 6 major trends for future profits Key trends Platform trends 1 Platform landscape impacted by digitization, yields opportunities regarding distribution revenues and cost reduction Customer trends 4 Willingness to pay for TV 2 Encryption allows ProSiebenSat.1 to capitalize content and quality 5 Digital distribution players emerge (existing partners, new players) with new revenue opportunities via mobile distribution 3 Bundling digital entertainment & TV products jointly with distribution platforms to increase ARPU 6 Non-linear consumption of content increases with upsides for monetization | October 15, 2013 Page 80 Distribution market historically driven by monopolistic 1 structures… Satellite • 2010 HH: 16.7 m • 2013 HH: 17.8 m Cable operators Market share 2013 • 2010 HH: 18.2 m • 2013 HH: 16.7m IPTV • 2010 HH: 1.4 m • 2013 HH: 2.0 m Uplink IPTV DVB-T 5% 5% Cable 43% Terrestrial • 2010 HH: 2.0 m • 2013 HH: 1.9 m Satellite 46% Playout Emerging technologies | October 15, 2013 Note: Data based on Statistisches Bundesamt, SES/ASTRA, PwC, Wilkofsky Gruen Associates, published by PWC 2012 – adjustments to recent market development by P7S1 Page 81 …with digitization offering opportunities to leverage 1 platform churn risks • • • • Distribution platforms Customer base as of today Satellite Cable IPTV Digital/mobile platforms | October 15, 2013 Note: HH=households Churn factors Price Features Number of channels Mobile usage Churn potential Infrastructure • ~65% of HH locked in cable/satellite via housing association deals • ~25% of HH with no cable access • ~40% of HH with no sufficient broadband Competition regarding subscribers and price Page 82 Strong demand for encrypted quality TV leads to 2 additional revenue streams Encryption • Further grow HD business • Implement mobile TV streaming Pay distribution • Diversify Pay TV portfolio Mobile distribution • Monetize next technology step (Ultra HD) | October 15, 2013 Page 83 Our digital product portfolio perfectly serves 3 platform’s bundling needs • Win-win opportunities for platforms and ProSiebenSat.1 • Syndication of multi-media bundles to platforms • Access to full customer base of platforms • Added value leads into attractive products – combining linear and non-linear content, technology and features • Offers marketed with distribution partners • Platforms act as content aggregator and distributor towards end customer | October 15, 2013 Page 84 Viewers willing to pay for features, quality and content – 4 proof of concept for future technology jumps (e.g., Ultra HD) Willingness to pay Satellite customers paying for TV – 1st time ever HD+ with 1.2m paying satellite customers 2013 Sky with increased ARPU Premium customers willing to pay EUR 10 for HD per month Mobile TV Market research shows willingness to pay for mobile TV Ultra HD/future technologies Secured revenues from technical evolution of distribution | October 15, 2013 Page 85 Technology and willingness to pay deliver stable 4 revenue growth FTA in HD HD FTA paying subscribers CAGR 2013-2018E P7S1 figures, average of December, in million 15.2 19.6 17.0 17% 12.8 8.8 4.4 10.6 6.9 5.8 7.8 8.6 9.2 16% Cable 2014E 2015E Satellite | October 15, 2013 2016E IPTV 2017E • Steadiness of revenues granted by low churn frequency • Sustainable subscriber growth 16% 14% 2013E • Infrastructural business model 2018E P7S1 HD enabled HH in Germany • Viewers pay for quality • Additional upside potential by increased technical reach of HD HH in Germany Page 86 Screen Digest 2010.2013-2017 based on own assumption that no. of TV-HH continues to grow by the same factor as the number of private households as defined by the German Federal statistical office '"HD-enabled households" =households with HD-display,HD STB, connected to platform. No. of movers by federal statistics office. Number of Changers by ANGA Technical reach for HD to double by 2018 with 4 additional growth potential identified Technical HD potential (HH in m)1 Specific measures to make viewers aware of HD and turn them into customers Growth initiatives to further boost HD penetration 20 9 2013E 11 growth • Increase HD awareness (e.g., promotional free HD day) • Enhance product attractiveness (e.g., push fast-forward functionality) 2018E 23% of 50% of all HH all HH | October 15, 2013 HD subscription boost in focus • Churn reduction measures through additional product features (e.g., catch-up TV) Page 87 Note: 1) Source: Based on TNS Infratest market research April 2013. Total HH target group as defined by TNS Infratest: TV households in Germany with persons over 18 years of age: HD enabled HH for P7S1 Pay TV serves market need for quality Pay TV channels 4 in HD Pay TV HD penetration of ProSiebenSat.1 Basic Pay TV subscribers • ProSiebenFun launches on Sky Satellite in January 2014 +22% 35% • Better monetization of HD channels (higher CPS than SD) 13% 2013E | October 15, 2013 2018E • High quality special interest Pay TV products (e.g., event based offerings) in response to market Page 88 Watch where you want: we will launch mobile streaming 5 app in 2014 • Development of mobile live streaming app to offer one-click access to all P7S1 channels • Live streaming and catch-up for full TV everywhere and anytime experience • Further push 360° distribution • Launch in 2014 • Huge market, already 65m smartphones in 2014, with growth to 77m in 2018 | October 15, 2013 Page 89 Watch whenever you want: VoD market with significant 6 market growth VoD VoD market volume Germany (EURm) CAGR +20% 480 438 407 356 • White label monetization of VoD content (e.g., Kabel Deutschland Select Video, UnityMedia, KabelBW, HD+ Replay) • Full-fledged integration of maxdome1) within partner platforms leveraging existing customer bases 276 194 • Further growth through VoDcontent on new screens 2013E 2014E 2015E 2016E 2017E | October 15, 2013 Source: Bundesverband Audiovisuelle Medien e.V.; P7S1 analysis; Revenues for Tentertain in D&A 1) maxdome reported in Digital & Adjacent segment 2018E Page 90 Financials 2012-2018 – distribution revenue growth Free To Air HD • Subscriber growth (CAGR 30%) Distribution revenues External revenues [in EURm] • Blended CPS increase, e.g., through inclusion of ProSieben MAXX in HD+ channel line-up ~150 ~50 Distribution 2012 Revenue growth Distribution 2018E • Free-to-air HD • Pay HD • Mobile | October 15, 2013 Δ ~EUR 100m Pay HD • HD Pay channel subscriber growth Mobile • Monetization of mobile distribution of linear signal Revenue insurance • Implementation of staggered contract duration to secure solid revenue structure Page 91 Summary • Revenues to triple from ~EUR 50m in 2012 to ~EUR 150m in 2018 • Solid and non-volatile growth: double-digit revenue CAGR by 2018 • Delivering significant recurring EBITDA margin • Meaningful contribution to shareholder value creation | October 15, 2013 Page 92 Disclaimer This presentation contains "forward looking statements" regarding ProSiebenSat.1 Media AG ("ProSiebenSat.1") or ProSiebenSat.1 Group, including opinions, estimates and projections regarding ProSiebenSat.1's or ProSiebenSat.1 Group's financial position, business strategy, plans and objectives of management and future operations. Such forward looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of ProSiebenSat.1 or ProSiebenSat.1 Group to be materially different from future results, performance or achievements expressed or implied by such forward looking statements. These forward looking statements speak only as of the date of this presentation and are based on numerous assumptions which may or may not prove to be correct. No representation or warranty, expressed or implied, is made by ProSiebenSat.1 with respect to the fairness, completeness, correctness, reasonableness or accuracy of any information and opinions contained herein. The information in this presentation is subject to change without notice, it may be incomplete or condensed, and it may not contain all material information concerning ProSiebenSat.1 or ProSiebenSat.1 Group. ProSiebenSat.1 undertakes no obligation to publicly update or revise any forward looking statements or other information stated herein, whether as a result of new information, future events or otherwise. | October 15, 2013 Page 93