1 Welcomes. 2 CBS Vision Presentation To CABA David F. Poltrack Chief Research Officer, CBS...

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Welcomes

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CBS Vision Presentation To CABACBS Vision Presentation To CABA

David F. PoltrackDavid F. Poltrack Chief Research Officer, CBS CorporationChief Research Officer, CBS CorporationPresident, CBS VisionPresident, CBS Vision

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CABA DIGITAL HOME FORUMCABA DIGITAL HOME FORUM

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““Participants will be engaged to openly discussParticipants will be engaged to openly discuss current research strategy as it relates to the connectedcurrent research strategy as it relates to the connected home sector and their respective organizations”home sector and their respective organizations”

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Not just connection…CommitmentNot just connection…Commitment

David F. PoltrackDavid F. Poltrack Chief Research Officer, CBS CorporationChief Research Officer, CBS CorporationPresident, CBS VisionPresident, CBS VisionFebruary, 2011February, 2011

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CBS has just completed the latest wave of its on-going New Entertainment Technology Research Program at our state-of-the-art Television City research facility in Las Vegas. This program, which began in 2004, has allowed us to monitor the scope and speed of the transition of the U.S video market from a one-screen, linear market to its current three-screen, non-linear form.

In our research, we have discovered the changes in connection provided by the new technologies to be transformative in terms of expanding the consumer’s connectivity and providing access to video entertainment. We have also found the new technologies effective in altering the consumer’s information-gathering processes.

However, to-date, we have found these technologies to be having less impact on the entertainment options chosen by the consumer. In this case, greater connectivity does not appear to be leading to a commitment on the part of the consumer to substantially change his or her consumption of video entertainment content.

If the adoption of new technology does not lead to a commitment to behavioral change on the part of the consumer, then that consumer is unlikely to continue to place a high value on that technology.

Not just connection…CommitmentNot just connection…Commitment

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Television City

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HOME TECHNOLOGY SURVEYHOME TECHNOLOGY SURVEY

IMMERSION RESEARCH

INTERACTIVE SURVEY

PRODUCT DEMONSTRATION

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20 Focus Groups Adults 25-54

18-34= 42%35-64= 57%

No Dependent Young Adults Sample = 232

College Grad= 66% Median Income= $101,000

34 States Represented

Television City New Technology Focus Groups Television City New Technology Focus Groups December 2010- January 2011December 2010- January 2011

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COALITION FOR INNOVATION IN MEDIA MEASURMENT-CIMMCOALITION FOR INNOVATION IN MEDIA MEASURMENT-CIMM

Total industry initiative to foster new audience measurement research solutionsTotal industry initiative to foster new audience measurement research solutions

Charter members include: CBS NBC/UNIVERSAL DISNEY-ABC TV GROUP ESPN FOX/NEWS CORP TIME/WARNER VIACOM DISCOVERY

Charter members include: STARCOM/MEDIAVEST WPP/GROUP M OMNICOM INTERPUBLIC P&G UNILEVER ATT

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COALITION FOR INNOVATION IN MEDIA MEASURMENT-CIMMCOALITION FOR INNOVATION IN MEDIA MEASURMENT-CIMM

Total industry initiative to foster new audience measurement research solutionsTotal industry initiative to foster new audience measurement research solutions

TOUCHPOINTS TAXI

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•ETHNOGRAPHIC RESEARCHETHNOGRAPHIC RESEARCH

LIMITATIONS LIMITED SAMPLES COOPERATION BIAS

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•ETHNOGRAPHIC RESEARCHETHNOGRAPHIC RESEARCH

TOUCHPOINTS VIRTUAL APPROACH

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Video Market SegmentationCONVERGENCE CONCEPTCONVERGENCE CONCEPT

“TV Centric”

“Old School”

“Web Centric”

“Fully Connected”

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Video Market SegmentationTOTAL ADULTS – SPRING 2006TOTAL ADULTS – SPRING 2006

Source: MRI, Spring 2006

“TV Centric”

“Old School”

“Fully Connected”

“Web Centric”

24%DIGITAL TV, NO BROADBAND

DIGITAL TV AND BROADBAND

16%BROADBAND, NO DIGITAL TV

35%NO DIGITAL TV, NO BROADBAND

25%

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Video Market SegmentationTOTAL ADULTS – SPRING 2010TOTAL ADULTS – SPRING 2010

Source: MRI, SPRING 2010

“TV Centric”

“Old School”

“Fully Connected”

“Web Centric”

16%

DIGITAL TV, NO BROADBAND

50%DIGITAL TV AND BROADBAND

17%

BROADBAND, NO DIGITAL TV

17%NO DIGITAL TV, NO BROADBAND

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Video Market SegmentationTOTAL ADULTS – SPRING 2011TOTAL ADULTS – SPRING 2011

Source: MRI, SPRING 2011

“TV Centric”

“Old School”

“Fully Connected”

“Web Centric”

16%

DIGITAL TV, NO BROADBAND

55%DIGITAL TV AND BROADBAND

16%

BROADBAND, NO DIGITAL TV

13%

NO DIGITAL TV, NO BROADBAND

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DIGITAL TV AND BROADBAND

“Fully Connected”76% (159)

NO BROADBAND, NO DIGITAL TV

“Old School”2% (10)

DIGITAL TV, NO BROADBAND

“TV Centric”15% (90)

Source: MRI, Spring 2010; Percent that Own a DVR, ( ) Index to Total U.S.

BROADBAND, NO DIGITAL TV

“Web Centric”7% (40)

Video Market SegmentationOWN A DVR – SPRING 2010OWN A DVR – SPRING 2010

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DIGITAL TV AND BROADBAND

“Fully Connected”80% (145)

NO BROADBAND, NO DIGITAL TV

“Old School”1% (7)

DIGITAL TV, NO BROADBAND

“TV Centric”12% (79)

Source: MRI, Spring 2010; Percent that Own a DVR, ( ) Index to Total U.S.

BROADBAND, NO DIGITAL TV

“Web Centric”6% (40)

Video Market SegmentationOWN A DVR – SPRING 2011OWN A DVR – SPRING 2011

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Fully Connected ConsumersFully Connected Consumers

Broadband+Digital TV PackageBroadband+Digital TV Package

25% 29%35%

46% 50%55%

2006 2007 2008 2009 2010 2011

Source: MRI

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CBS Annual New Technology ResearchCBS Annual New Technology Research

Watched Video on the InternetWatched Video on the Internet

63%

90%96% 95% 94%

2006 2007 2008 2009 2010

Source: CBS Television City, December Each Year

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CBS Annual New Technology ResearchCBS Annual New Technology Research

Watched TV Episodes on the InternetWatched TV Episodes on the Internet

39%48%

58%66%

76%

2006 2007 2008 2009 2010

Source: CBS Television City, December Each Year

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CBS Annual New Technology ResearchCBS Annual New Technology Research

Have a DVRHave a DVR

44%

59%69% 73%

68%

2006 2007 2008 2009 2010

Source: CBS Television City, December Each Year

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CBS Annual New Technology ResearchCBS Annual New Technology Research

Have VOD serviceHave VOD service

71%65%

77%72%

78%

2006 2007 2008 2009 2010

Source: CBS Television City, December Each Year

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CBS Annual New Technology ResearchCBS Annual New Technology Research

Ability to stream or download content on cell phoneAbility to stream or download content on cell phone

52%

66%

2006 2007 2008 2009 2010

Source: CBS Television City, December Each Year

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CBS Annual New Technology ResearchCBS Annual New Technology Research

Netflix SubscriberNetflix Subscriber

43%

2006 2007 2008 2009 2010

Source: CBS Television City, December Each Year

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CBS Annual New Technology ResearchCBS Annual New Technology Research

Evening Television Viewing Evening Television Viewing

69%

13%18%

69%

16% 15%

61%

17%21%

59%

12%

29%

Watch About theSame

Watch Less Watch More

2007 2008 2009 2010

Source: CBS Television City, December Each Year

28Source: NTI

DVR Homes vs. Non-DVR Homes – A18-49DVR Homes vs. Non-DVR Homes – A18-49

SEPTEMBER 19, 2011 - OCTOBER 2, 2011

2.9

2.4 2.52.7

2.1

2.6

2.1 2.0

4.9

3.94.2

4.5

CBS NBC ABC FOX

Non DVR Homes DVR Homes - Live DVR Homes - Live+7

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A18-49 as a Percent of Total Adult PopulationA18-49 as a Percent of Total Adult Population

18-4962%

50-549%

65+16%

55-6413%

2002-03

18-4957%

50-5410%

65+17%

55-6416%

2010-11

Source: Nielsen Universe Estimates

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A18-49 as a Percent of Total Adult PopulationA18-49 as a Percent of Total Adult Population

2010-11

18-4957%

50-5410%

65+17%

55-6416%

2015-16 (Est.)

Source: Nielsen Universe Estimates

18-4955%

50-549%

65+19%

55-6417%

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A18-49 is a Stagnant MarketA18-49 is a Stagnant Market

578,848

237,46792,028 68,408 58,751 20,096 24,750

1,720,532

2,147,5392,268,292 2,195,867 2,146,107 2,123,735

2,029,182

2001 2006 2011 2012 2013 2014 2015

Source: U.S. Census Bureau

Year-Over-Year Growth

Projections

A18-49

A50+

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New Season “Buzz”New Season “Buzz”New Season “Buzz”New Season “Buzz”

PRIMETIMEPRIMETIME

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Mode of Discussion – Ages 13-69Mode of Discussion – Ages 13-69

80%

12%7%

1%

In Person Phone Online Other

Source: Keller Fay Group’s TalkTrack, Sepetmber 2011; N=700

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Mode of Discussion – Adults 18+Mode of Discussion – Adults 18+

92%

35%

10% 9% 8%3% 2%

In Person Phone Facebook Email Texting IM Twitter

Source: CBS Entertainment Panel, September 2011, N=3,300

In which of the following ways have you discussed new television programs with other people? Select All that Apply.

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Primary Mode of DiscussionPrimary Mode of Discussion

78%

13%4% 2% 2% 1% 1%

10% 8%1% 5% 1% 2%

71%

In Person Phone Facebook Email Texting IM Twitter

A18+ A18-34

Source: CBS Entertainment Panel, September 2011, N=3,300

In which of the following ways have you been most likely to discuss new television programs with other people?

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Mode of Discussion – Adults 18-34Mode of Discussion – Adults 18-34

92%

35%

10% 9% 8%3% 2%

In Person Phone Facebook Email Texting IM Twitter

Source: CBS Entertainment Panel, September 2011, N=3,300

In which of the following ways have you discussed new television programs with other people? Select All that Apply.

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NETFLIXNETFLIX

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Subscribers: 20,000,000 (U.S + Canada) Growth: +63% At peak times accounts for 20% of U.S. bandwidth

consumption Nielsen Sample: 17% Entertainment Panel: 37% New Technology Groups: 43% Lapsed Subscribers: 13% Very/Somewhat Likely to Subscribe this year: 10%

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Sources of on line television programsSources of on line television programs

2010 09 08

YouTube 41% 31% (32%) Network Television Sites 54% 73% (71%) Cable Television Sites 33% 33% (34%) Google Video 9% 3% (11%) Hulu 57% 48% (19%) Facebook 8% 5% ( 5%)

Netflix 35% iTunes 16% 9% (11%) Yahoo Video 6% 1% (7%)

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Frequency of Streaming Movies TV Shows

Several Times Per Week 27% 26%

Once a Week 16% 8%

Several Times per Month 29% 20%

Once a Month 9% 9%

Less than Once a Month 9% 16%

Never 9% 20%

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Streamed Last Week Movies TV Shows

Monday 29% 35%

Tuesday 28% 33%

Wednesday 29% 33%

Thursday 26% 33%

Friday 39% 35%

Saturday 42% 34%

Sunday 32% 31%

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Streaming From Any More Less

Game Console 49% 56% 13%

Blu-Ray Player 18% 48% 13%

HDMI Cable 11% 45% 18%

Laptop 38% 32% 24%

Desktop 22% 24% 32%

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Streaming From Any More Less

Game Console 49% 56% 13%

Game System

Nintendo Wii 60%

Sony Playstation 3 32%

X-Box 360 30%

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Streaming From Any More Less

Game Console 49% 56% 13%

Blu-Ray Player 18% 48% 13%

HDMI Cable 11% 45% 18%

IPTV 6% 57% 4%

TiVo 5% 49% 10%

Apple TV 3% 75% 0%

Google TV 1% 75% 25%

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Thank YouThank You