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1Tech‐Telecom‐Entertainment Hispanic Allocation Impact on Revenue Growth


Section 1

INTRODUCTION

Section 1

2


About the Author & Sources• The study was commissioned by AHAA’s Research Committee and

developed and executed by Santiago Solutions Group (SSG), a growth strategy consultancy.

• Independent methodological review performed by Dr. Cristina Garcia, professor of mathematics & statistics at USC.

Data Contributors• Financial revenue growth data extracted from companies 10Ks.• Parent company advertising spend data for 2006‐2010 Hispanic/Non‐Hispanic

media (TV, Radio, Print) collected from The Nielsen Company. • Nielsen Video Census 2012; Mobile Insight Survey: Netview 2012, Mobile Bill Panel,

Nielsen TV Panel• 2011 GfK Roper & 2011 Doublebase GfK MRI ‐ Base: All Adults 18+; n=6.6K

Hispanics & 46.5K Non‐Hispanics. (Sampling details in Appendix E).• 2010 Geoscape ‐ Consumer Spending Dynamix™• Scarborough USA+ 2011 Release 2 Total; Base: Adults 18+; Respondents: 151,099

White Non‐Hispanics & 27,301 Hispanics


BackgroundSince 1998, AHAA has been helping its members serve its clients through breakthrough independent studies that • increase understanding of what it takes to win the market, • share new concepts,• and identify best practices of marketing to Latinos.

Revenue Growth Study SeriesAHAA has led the industry’s first empirical studies to quantify the relationship and impact of Hispanic investment allocation on annual revenue rate of growth.

• In October 2011, Part 1 uncovered a strong positive relationship between allocation of Hispanic ad resources and topline growth among Best‐In‐Class companies, those allocating over 14% of their budgets to Hispanic media.

• In March 2012, Part 2 demonstrated that Hispanic Allocation positively affects revenue growth rates for Consumer Packaged Goods companies, explaining about 35% of changes in revenue growth.

• This third part of AHHA’s Revenue Growth study focuses on Technology, Telecom and Entertainment companies including:– manufacturers of consumer hardware (computers, TVs, cell phones)– content (media, movies, games)– connectivity providers (cable, satellite, wireless)

Study 1

Hispanic Ad Allocation

Top 500 Overall U.S. Advertisers

Study 2


Consumer Packed Goods

Current Study (Study 3)


Technology

Other Sectors

Future studies


Tech Sector ChallengesTech Growth Rates Has Stalled

• Domestic revenue growth rates for the tech‐telecom‐entertainment sector plunged from about 11% a year in 2006‐2007 to just about 3% 2009‐2010, about a third of what pre‐recession levels.

• Technology and new media will further redefine lifestyles and business models.

• “Reset” beyond economic adjustment– Consumers changed over long run

• More brand fickle• More frugal value‐oriented

Marketers Face More Competing Needs

1. Identifying new growth opportunities

2. Capturing fair share of fewer growth markets

3. Holding on to diminishing importance of aging ‘General Market’


Hispanic Market HighlightsMARKET SIZE• 2010 Population 50.7M1

• 2011 Hispanic Share of US Population 17%2

• 2011 Hispanic Share of US adults 15%2

GROWTH• Hispanic Population 2000‐2010 CAGR8 v Non‐Hispanic 3.6% v. 0.5%3

• Hispanic Share of Total US Population Growth 2000‐2010 56%4

• Hispanic Share of Labor Force Growth 2010‐2020 74%7

ECONOMIC• 2012 Estimated Buying Power $1.2 Trillion5

• Hispanic Buying Power 2000‐2010 CAGR v. Non‐Hisp 7.8% v. 3.4%6

1, 3, 4 2010 Census ACS2 SSG Analysis of Census5,6 Selig Center at the University of Georgia7 Bureau of Labor Statistics8 CAGR = Compound Annual Growth Rate ‐ the year‐over‐year growth rate of an investment over a specified period of time; the rate at which an investment would have grown if it grew at a steady rate.


Hispanics have generated about a third of the Tech consumer base growth; expanding 3x faster than NH

While Hispanics accounted for 17% of the

population in the US, they also contributed to

34.8% of the growth in the Tech‐Telecom‐

Entertainment consumer base.

During 2006‐2010, the Hispanic consumer base in the Tech‐Telecom‐Entertainment category grew 3 times faster than the Non‐Hispanic consumer base.

Source: SSG Analysis of 2006-2010 GfK MRI


Study Objectives

To understand if there a significant difference in the

revenue growth rate attained by

Tech‐Telecom‐Entertainment advertisers

which designate higher allocation of ad resources to the

Hispanic market

and those that focus less.


Study Variables

Aggregate Hispanic Allocation 2006‐2010

The percentage of ad budgets dedicated to Hispanic media (Hispanic Allocation) possibly impacting Revenue growth rates*. • The % of total advertisement dollars spent in TV,

Radio, and Print (per Nielsen tracking) assigned to Hispanic‐centric media channels throughout 2006 to 2010. – Accepted, standardized marketing spend measurement of

below the line expenditures is not available, thus, not utilized.

– Online expenditures will be included in future studies.

Revenue CAGR 2006‐2010

Revenue CAGR is the dependent variable which was tested against different levels of Hispanic Allocation.

• Revenue reflected from US‐only, organic, per 10Ks and SEC reports. − May have been adjusted to exclude

extraordinary financial transactions.− Revenues have been adjusted where

possible to include streams from acquisitions, if enough clear data has been stated in corporate financials.

*CAGR = Compound Annual Growth Rate ‐ the year‐over‐year growth rate of an investment over a specified period of time; the rate at which an investment would have grown if it grew at a steady rate.


MethodologyHispanic Allocation and organic revenue growth rates of 40 Tech‐Telecom‐Entertainment companies, a subset of the Top 500 US advertisers which are publicly‐held, were tested for 2006 to 2010.

• First, we tested the linear association of the two variables through correlation analysis.

• Next, the causal nature of Hispanic allocation upon revenue growth rate was tested through linear regression analysis.

• Details of statistical analysis n Section 5.


Tech Sample Set• Out of about 35,000 US advertisers tracked

by Nielsen, identified the Top 500 overall Advertisers (TV, Radio, Print) by year and in aggregate between 2006 and 2012.

• Matched each parent company to available US organic revenue data from 10Ks or published disclosure. Adjusted for extraordinary transactions and calculated 2006‐2010 compounded annual growth rates.

• Companies with financials that were not adjustable such as some with undisclosed details around M&As, were eliminated from the final regression set.

• Ended with 40 companies in the Technology, Telecom, Media & Entertainment sector.

Top 500 U.S. Overall Advertisers 2006-2010

(500)

Public(418)

Consistent Advertisers(246)

Publicly Tradedw/ clear Organic US Revenue

(235)

Tech-Telecom-Entertainment

(40)

Unadjustable M&AsInconsistent Data

(-9)

Inconsistent Advertisers(-172

Private(-82)


40 Tech‐Telecom‐EntertainmentCompanies In Sample Set

For GE, only its Media & Entertainment revenues while owners of NBCU were included in the analysis; excluded all other LOBs revenue streams.


Section 2

TECH‐TELECOM‐ENTERTAINMENTSTUDY FINDINGS

Section 1

13


Finding 1: Tech‐Telecom‐Entertainment Growth Rates Are Directly and Positively Impacted by Hispanic Allocation

• The study shows a direct & positive relationship between Tech‐Telecom‐Entertainment’s Hispanic ad allocation and overall topline revenue growth.

• The study shows that in general the higher the Hispanic allocation displayed on the horizontal axis, the higher propensity of organic revenue CAGR, indicated on the vertical axis, attained by companies in the sector, and vice versa.

Please see Appendix D (Graph 1) for Detailed Graph and Graphical Analysis.


• The top 30 percentile of Allocation and top 30 CAGR percentile includes DirecTV, Echostar/Dish Network, Metro PCS, Leap Wireless, Time Warner Cable and Verizon.

• The mid 40 percentile in Allocation & Growth include: T‐Mobile, Cablevision, AT&T, Lions Gate Entertainment, Comcast, Vonage, Best Buy and News Corp.

Finding 1: Tech‐Telecom‐Entertainment Growth Rates Are Directly and Positively Impacted by Hispanic Allocation

Please see Appendix D (Graph 1) for Detailed Graph and Graphical Analysis.

Top 30 Percentile

Anomalies (See p 17 & Appendix F)

Mid 40Percentile

Bottom 30Percentile


Finding 2: Apple & Samsung are in a class apartDeviations from the normal or anomalies

As the top global innovation leaders, Apple & Samsung have reinvented how the world communicates, gathers information and is entertained.

• In 2007 Apple’s iPhone reinvented the phone and ushered in the modern era of intelligent, connected devices.

• Samsung’s Galaxy, the first set on Google’s Android platform, was released in 2008 and has since overtaken the lead smartphone position.

In just five years, they forced a flurry of changes like tablets, apps, and mobile marketing as well as upheaval among tech manufacturers, retailers and data services revenues for connectivity providers.

See more details on Apple & Samsung in Appendix F


Finding 3: As Hispanic Allocation increases, the revenue rate of growth of Tech competitors soars sharply

Frequencies*• Companies in the Top Tier allocate

twice as much as the Mid Tier

– but the Top Tier growth is 3 times larger than the Mid Tier

• The companies in the Bottom Tier see a decrease in growth

– From these frequencies it seems that minimal allocation means no growth or even a reduction in growth.

This trend is what the regression model will test...

13.3%

6.2%

0.4%

12.9%

3.4%

‐1.4%

‐4.0%

‐2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

Top Tier 71‐100 Percentile

Mid Tier 31‐70 Percentile

Bottom Tier 0‐30

Average Allocation & Growth By Tier*

06‐10 Hisp Allocation

06‐10 Revenue CAGR

All Avg Allocn 6.3%

All Avg Rev CAGR 3.4%

*Excludes Anomalies: Apple & Samsung


Finding 4: Every 1 point increase in Hispanic Allocation yields a boost of about two‐thirds of a point in annual growth rate

• The regression demonstrates that for every additional percentage point increase in Hispanic Allocation, we would expect an average annual organic revenue growth boost of 0.68%.– That is, on average, for allocating

an additional 10% of the company’s ad resources to Hispanic media over 5 years, an average increase of 6.8% in organic revenue annual growth rate would be expected.

• Organic revenue growth rates decline sharply as Hispanic share of budgets decrease and vice versa.

+1 point ↑Hispanic Allocation

+0.68 point ↑Annual Revenue Growth Rate


Finding 5: Hispanic Allocation explains 30% of increase in Tech Sector Revenue Growth Rates*

• Hispanic Allocation explains a substantial portion (30%) of Tech‐Telecom‐Entertainment increase in topline revenue growth– The other 70% may include other critical

factors such as product innovation, user experience, brand equity/reputation, brand experience, strategic focus, price, operational alignment, distribution, sales force, past performance, talent, incentives, overall segmentation expertise, etc.

– Further analysis is needed to determine what other drivers could be measured in standard ways and what statistical contribution these may have in revenue growth.

Hispanic MarketingAllocation

30%

Other Drivers ofGrowth70%

Tech‐Telecom‐Entertainment & Revenue Growth Drivers

* Excluding Anomalies: Apple & Samsung


Finding 6: Including leading global innovators, Hispanic Allocation explains 17% of Revenue CAGR

• Including Apple & Samsung, Hispanic Allocation alone explains about 17% of Tech‐Telecom‐Entertainment increase in topline revenue growth.

– The other 83% may include other critical factors such as product innovation, user experience, brand reputation, brand experience, strategic focus, price, measurement tools, distribution, sales force, segmentation expertise, etc.

– Further analysis is needed .

• The study shows that an averagerevenue growth rate of 0.56% over the 5 years is expected for every additional percentage point increase in Hispanic allocation.

Hispanic MarketingAllocation

17%

Other Drivers ofGrowth83%

Tech‐Telecom‐Entertainment & Revenue Growth Drivers


Summary Findings

1. There is positive relationship between Hispanic allocation and Revenue CAGR, meaning, the more a company allocates Hispanic budget, the higher the corporate growth.

– As Hispanic Allocation increases, the revenue rate of growth of Tech competitors soars sharply

2. Tech‐Telecom‐Entertainment companies show that Hispanic Allocation accounts for 30% of increase in revenue growth.

• Including Apple & Samsung, Hispanic Allocation explains about 17% of the fluctuations in revenue growth rates, accentuating the need for Hispanic allocation among tech convergence companies that don’t have revolutionary innovations and brand experiences.


Section 3

HISPANIC OPPORTUNITY DRIVERS

Section 1

22


Psychographic & Behavioral Drivers By Purchase Cycle Stage


Hispanics Needs of Technology Go Beyond Functionality!

• ToTop Box: Agree Completely or Agree Mostly, or Very Important

Hispanic Index v NH

I want others to say "wow" when they see my electronics.

169

My cell phone is an extension of my personality.

163

I am among the first of my friends and colleagues to try new technology products.

133

Source: 2011 Doublebase GfK MRI - Base: All (n= 6.6K Hispanics & 46.5K Non-Hispanics)


Hispanics Tend To Be Tech Early Adopters and Influential

Top Box: Agree Completely or Agree Mostly, or Very Important

Hispanic Index v

NHI give others advice when they are looking to buy technology or electronics products.

153

I enjoy learning about technology or electronic products from others.

131

I enjoy reading about new technology products.

131



Hispanics Are Ideal Tech Consumers!


Hispanic Index v

NHI’m fascinated by new technology.

130

I prefer products that offer the latest technology.

129

I’m willing to pay more for top quality electronics.

125

• Technology friendly and willing to pay more



Hispanics Use Tech As Extension of their Highly Social Culture

High tech adopters; leaped frog to mobile

• Nearly as likely to have Internet at home 90

• More likely to have smartphone 128

• Monthly spend on cell phones 115

• Only cell 129

Particularly social across all platforms

• Calls per day 144

• Monthly time in social networks 113

Heavy video content users across all screens

• Time spent streaming 118

• Online Video monthly usage 163

• Mobile Video monthly usage 120

Source: Nielsen Video Census 2012; Mobile Insight Survey: Netview 2012, Mobile Bill Panel, Nielsen TV Panel

Hispanic Index to NH


Hispanics Growth Opportunity Will Continue To Be Robust

Source: Scarborough USA+ 2011 Release 2 Total; Base: Adults 18+; Respondents: 151,099 White Non‐Hispanics & 27,301 Hispanics

Tech Gadget2011 HouseholdPenetration

Hisp Index (vs WNH)

Purchase IntentNext 12 Months

Hisp Index (vs WNH)

iPad 141 159

Video Game system 103 209

MP3 player 98 174

Blu‐ray disc player 93 137

HDTV 91 170

• Hispanics intent to purchase hottest Tech products exceeds that of White Non‐Hispanics


Hispanics offer high Lifetime Value

Average Aggregate Household Lifetime Spending

NH White $435,690

Black $319,359

Asian $1,043,365

Hispanic $601,991

• Cumulative total Tech‐Telecom‐Entertainment spending is 38% greater for Hispanic households than that of White Non‐Hispanic households– Driven by 16 years longer Hispanic household lifespan and higher expenditures

than non‐Hispanic Whites.

Source: 2010 Geoscape Consumer Spending Dynamix.™


Hispanics See Technology as Entertainment!


Hispanic

Index

I think of my mobile phone as a source of entertainment.

137

Computers can be a good source of entertainment.

117



Section 4

IMPLICATIONS

Section 1

31


Hispanic Allocation Impact on Growth Key Takeaways

• This study shows that Tech‐Telecom‐Entertainment companies which allocate higher share of their ad resources at Hispanics, return higher growth rates than those that apportion less.− Devoting adequate resources to Hispanic has a critical role in optimizing Hispanic growth

• Hispanic allocation is a significant driver to healthy organic growth in this discretionary category– Hispanic Allocation is substantial enough in the ‘winning equation’ to transform company

results ‐‐propelling players, obstructing competitors, building sustainable advantages

– This is especially so for companies that don’t have revolutionary product innovations in their pipeline like the first iPhones, iPads or Google/Android smartphones.

– Compromising Hispanic Allocation can have negative short and long‐term growth effects.

• Huge growth opportunity lies ahead as Hispanics continue to lead adoption and usage– Brand loyalties will be increasingly at stake as Hispanics dominate segment growth.


Implications for Tech Convergence Sector• Real bottom‐line benefits come from consistent allocation investments.

• Allocations to communications is only the beginning; decisively as important is corporate‐wide strategic and operational integration

– Developing holistic strategies from communications and product innovation to brand‐customer experience.

– Broad use of all elements of marketing: above and below the line.

– Responding to the most appropriate cultural insights.

– As in the CPG sector, successful sustainable growth advantages in Hispanic market might enhance valuation differentials.

• Many companies may be falling short of their optimal revenue generation or handing off growth points to competitors with higher allocation and cohesive Hispanic‐centric strategies.


Section 5STATISTICAL DETAIL & MODEL VALIDATIONPresented by Dr. Cristina Garcia, Math & Statistics Professor at USCAHAA Methodology Advisor

Section 1

34


Sectors/Super CategoriesBreakdown

B2B

Tech‐Telecom‐Entertainment

Consumer Packaged Goods

Government

PrivateAuto

Retail

Insurance/Finance UnadjustableMergers & Acquisitions

Omitted Advertisers(Reasons)

Super Categories(Included)

Non‐Profit


Test Validations

All validation tests corroborated the same findings.

Hispanic Allocation has a direct & significant impact on companies overall revenue growth.

Main Regression


Other Key FindingsThree additional validation test regressions corroborated the same findings with 95% statistical significance including:

• larger sample size among Top 500 advertisers which are publicly held, 235 companies, looking at allocations relationship with aggregate revenue CAGR

• same sample but looking at relationship between allocation and individual years growth changes (between 2006 & 2010),

• Similar statistical significant findings across 5 other categories.

• See Detailed Findings after Psychographics section.


Main Regression Model (w/o Anomalies)

• Hispanic Allocation alone explains

about 30% of changes in revenue growth over a 5 year period for Tech‐Telecom‐Entertainment (R2=0.30)

– An R squared of .30, tells us that roughly 30% of a company’s revenue growth is driven by changes in Hispanic Allocation.

Revenue Growth over 5 year period (CAGR 06-10)

Aggregate Hispanic

Allocation 2006-2010

Tech‐Telecom‐Entertainment (N=38)


Tech‐Telecom‐Entertainment Model Findings (w/o Anomalies)

• We would expect an average revenue growth of 0.678% over the 5 years for every additional percentage point increase in Hispanic allocation.

• In other words, the expected range for allocating 10% of the company’s ad resources to Hispanic media over 5 years is an increase of 3.26% to 10.29% in overall corporate revenue growth rate.

Hispanic Allocation

30%

All Other Drivers ofGrowth70%

Revenue Growth Drivers for Tech‐Telecom‐Entertainment

N=38


Main Regression Model

• Hispanic Allocation alone explains

about 17% of changes in revenue growth over a 5 year period for Tech‐Telecom‐Entertainment (R2=0.17)

– An R squared of .17, tells us that roughly 17% of a company’s revenue growth is driven by changes in Hispanic Allocation.

Revenue Growth over 5 year period (CAGR 06-10)

Aggregate Hispanic

Allocation 2006-2010

Tech‐Telecom‐Entertainment (N=40)


Tech‐Telecom‐Entertainment Model Findings

– We would expect an averagerevenue growth of 0.559% over the 5 years for every additional percentage point increase in Hispanic allocation.

– In other words, the expected range for allocating 10% of the company’s ad resources to Hispanic media over 5 years is an increase of 1.48% to 9.7% in overall corporate revenue growth rate. Hispanic

Allocation 17%

All Other Drivers ofGrowth83%

Revenue Growth Drivers for Tech‐Telecom‐Entertainment

N=40


Test 1: Is Aggregate Hispanic Allocation Important?YES! Hispanic Allocation directly impacts topline revenue

growth for Top 500 Advertisers

• On average, for every additional percentage point increase in Hispanic allocation, we would expect revenue growth of .47% over the 5 years.

• In other words, allocating 10% of the company’s ad spend to Hispanic media over 5 years would generate revenue growth of 4.7% over the 5 year period

Aggregate Growth

CAGR 06‐10

Aggregate Hispanic Allocation

06‐10

TOP ADVERTISERS (N=235)


TEST 2: Individual Years Growth and Aggregate Hispanic AllocationRevalidated! Both directly impact topline revenue growth

Revenue Growth over 5 year period

Aggregate Hispanic Allocation

06-10

CAGR06-07, 07-08, 08-09, 09-10

• Of course, each year’s CAGR most significantly affects the company’s revenue growth over 5 years

• R‐square 0.305 In other words, 30.5% of the variation in growth over the 5 years (CAGR 06‐10) is explained by the ad spend in Hispanic media over the 5 years and each year’s annual growth.

• On average, for every additional percentage point increase in Hispanic allocation, we would expect revenue growth of .468% over the 5 years.

• In other words, allocating 10% of the company’s ad spend to Hispanic media over 5 years would generate revenue growth of 4.68% over the 5 year period.



Test 3: Hispanic Allocation, Super Categories and Revenue CAGR Revalidated Again! Hispanic Allocation Is Relevant to Revenue Growth!

Revenue Growth over 5 year period

Categories: Auto, Tech & Entertainme

nt, Retail, CPG,

Finance/Insurance

CAGR:06-07, 07-08, 08-

09, 09-10

Hispanic Allocation:

06-10

• R‐square .376, in other words, 37.6% of the variation in growth over the 5 years (CAGR 06‐10) is explained by the ad spend in Hispanic media over the 5 years andeach annual year’s growth.

• On average, for every additional percentage point increase in Hispanic allocation, we would expect revenue growth of 0.464% over the 5 years.

• In other words, allocating 10% of the company’s ad spend to Hispanic media over 5 years would generate revenue growth of 4.64% over the 5 year period.



Section 6

APPENDIX

Section 1

45


Appendix A Ranking By Hispanic Allocation

Company 2006-2010 Hispanic Allocation Percentage Rank Percentile 2006-2010 Revenue

Growth RateECHOSTAR /DISH NETWORK 26.0% 1 100.0% 12.3%

DIRECTV GROUP INC 24.8% 2 97.4% 10.4%

TIME WARNER CABLE 16.9% 3 94.8% 12.5%

LEAP WIRELESS INTL INC 16.8% 4 92.3% 21.6%

METROPCS INC 13.8% 5 89.7% 27.4%

DEUTSCHE TELEKOM/T‐MOBILE 13.6% 6 87.1% 4.2%

CABLEVISION SYSTEMS CORP 12.6% 7 84.6% 9.5%

RADIOSHACK CORP 11.0% 8 82.0% 0.1%

AT&T INC 7.9% 9 79.4% 6.5%

VERIZON COMMUNICATIONS INC 7.6% 10 76.9% 13.6%

SPRINT NEXTEL CORP 5.9% 11 74.3% ‐5.6%

WALT DISNEY CO 5.2% 12 71.7% 2.1%

LIONS GATE ENTERTAINMENT 4.1% 13 69.2% 10.4%

MOTOROLA INC 3.9% 14 66.6% ‐11.4%

BEST BUY CO INC 3.9% 15 64.1% 8.0%

COMCAST CORP 3.7% 16 61.5% 10.8%

GENERAL ELECTRIC CO 3.3% 17 58.9% ‐4.0%

TELEPHONE & DATA SYSTEMS INC 3.2% 18 56.4% 3.4%

NEWS CORP 2.9% 19 53.8% 6.0%

VONAGE HOLDINGS CORP 2.8% 20 51.2% 10.7%

TOP TIER

71

‐100

PER

CENTILE IN

ALLOCA

TION

MID TIER

31‐70 PERC

ENTILE


Ranking By Hispanic Allocation Cont.

Company2006-2010 Hispanic

Allocation Percentage

Rank Percentile 2006-2010 Revenue Growth Rate

TIME WARNER INC 2.2% 21 48.7% ‐6.0%

SONY CORP 2.1% 22 46.1% ‐5.0%

COX ENTERPRISES INC 2.0% 23 43.5% 3.1%

LIBERTY MEDIA CORP 1.8% 24 41.0% 6.1%

EASTMAN KODAK CO 1.3% 25 38.4% ‐9.9%

ELECTRONIC ARTS INC 1.1% 26 35.8% 6.3%

MICROSOFT CORP 0.9% 27 33.3% 6.7%

HEWLETT‐PACKARD CO 0.4% 28 30.7% ‐2.7%

APPLE INC 0.3% 29 28.2% 27.0%

ROYAL PHILIPS ELECTRONICS NV 0.1% 30 25.6% ‐2.5%

LG GROUP 0.1% 31 23.0% ‐1.4%MATSUSHITA ELECTRIC INDUSTRL CO LTD/PANASONIC 0.1% 32 20.5% ‐9.8%

SEIKO CORP/EPSON 0.1% 33 17.9% 0.1%

SEGA SAMMY HOLDINGS INC 0.1% 34 15.3% ‐0.1%

DELL INC 0.1% 35 12.8% ‐0.3%

GARMIN LTD 0.1% 36 10.2% 10.8%

SAMSUNG ELECTRONICS CO LTD 0.0% 37 7.6% 17.1%

SHARP CORP 0.0% 38 5.1% ‐6.6%

TOSHIBA CORP 0.0% 39 2.5% 8.2%

TEXAS INSTRUMENTS INC 0.0% 40 0.0% ‐0.5%

MID TIER

31‐70 PERC

ENTILE

BOTTOM TIER

0‐30

PER

CENTILE IN

ALLOCA

TTION


Appendix BRanking By Growth Rate

Company 2006-2010 Revenue Growth Rate Rank Percentile

2006-2010 Hispanic

AllocationMETROPCS INC 27.4% 1 100.00% 13.8%

APPLE INC 27.0% 2 97.40% 0.3%

LEAP WIRELESS INTL INC 21.6% 3 94.80% 16.8%

SAMSUNG ELECTRONICS CO LTD 17.1% 4 92.30% 0.0%

VERIZON COMMUNICATIONS INC 13.6% 5 89.70% 7.6%

TIME WARNER CABLE 12.5% 6 87.10% 16.9%

ECHOSTAR/DISH NETWORK 12.3% 7 84.60% 26.0%COMCAST CORP 10.8% 8 82.00% 3.7%

GARMIN LTD 10.8% 9 79.40% 0.1%

VONAGE HOLDINGS CORP 10.7% 10 76.90% 2.8%

DIRECTV GROUP INC 10.4% 11 74.30% 24.8%

LIONS GATE ENTERTAINMENT CORP 10.4% 12 71.70% 4.1%

CABLEVISION SYSTEMS CORP 9.5% 13 69.20% 12.6%

TOSHIBA CORP 8.2% 14 66.60% 0.0%

BEST BUY CO INC 8.0% 15 64.10% 3.9%

MICROSOFT CORP 6.7% 16 61.50% 0.9%

AT&T INC 6.5% 17 58.90% 7.9%

ELECTRONIC ARTS INC 6.3% 18 56.40% 1.1%

LIBERTY MEDIA CORP 6.1% 19 53.80% 1.8%

NEWS CORP 6.0% 20 51.20% 2.9%

TOP TIER

71

‐100

PER

CENTILE IN

GRO

WTH

MID TIER

31‐70 PERC

ENTILE


Ranking By Growth Rate Cont.

Company2006-2010

Revenue Growth Rate

Rank Percentile2006-2010 Hispanic

AllocationDEUTSCHE TELEKOM AG/T‐MOBILE 4.2% 21 48.70% 13.6%

TELEPHONE & DATA SYSTEMS INC 3.4% 22 46.10% 3.2%

COX ENTERPRISES INC 3.1% 23 43.50% 2.0%

WALT DISNEY CO 2.1% 24 41.00% 5.2%

SEIKO CORP 0.1% 25 38.40% 0.1%

RADIOSHACK CORP 0.1% 26 35.80% 11.0%

SEGA SAMMY HOLDINGS INC ‐0.1% 27 33.30% 0.1%

DELL INC ‐0.3% 28 30.70% 0.1%

TEXAS INSTRUMENTS INC ‐0.5% 29 28.20% 0.0%

LG GROUP ‐1.4% 30 25.60% 0.1%

ROYAL PHILIPS ELECTRONICS NV ‐2.5% 31 23.00% 0.1%

HEWLETT‐PACKARD CO ‐2.7% 32 20.50% 0.4%

GENERAL ELECTRIC CO ‐4.0% 33 17.90% 3.3%

SONY CORP ‐5.0% 34 15.30% 2.1%

SPRINT NEXTEL CORP ‐5.6% 35 12.80% 5.9%

TIME WARNER INC ‐6.0% 36 10.20% 2.2%

SHARP CORP ‐6.6% 37 7.60% 0.0%MATSUSHITA ELECTRIC INDUSTRL CO LTD/PANASONIC

‐9.8%38 5.10% 0.1%

EASTMAN KODAK CO ‐9.9% 39 2.50% 1.3%

MOTOROLA INC ‐11.4% 40 0.00% 3.9%

MID TIER

31‐70 PERC

ENTILE

BOTTOM TIER

0‐30

PER

CENTILE IN

GRO

WTH


Appendix C1Regression Analysis Results


Appendix C2: w/o Apple & Samsung anomaliesRegression Analysis Results


Appendix DGraphical Analysis

Graph 1


Appendix DGraphical Analysis

Chart 2


Appendix EGfK MRI Hispanic Data Notes

• GfK MRI has measured Hispanics within its National Study (Survey of the American Consumer).

• Since 2003, GfK MRI began translating all survey materials into Spanish and hiring bilingual interviewers to capture the Spanish dominant Hispanic.

• Other enhancements to data sampling since then include:

– Hispanic language capability sample balanced against Nielsen Language estimates

– Additional Hispanic specific demographics (language capability outside the home, language capability inside the home, country of origin, foreign born, length of time in the U.S., additional Hispanic adults in the home, how well do you speak English)

– Hispanic specific media (3 Magazines, 135+ Television Programs, 2 Cable stations, 3 Radio formats, 3 websites)

– Hispanic specific segmentations (Geoscape Hispanicity, Hispanic Cohorts, Hispanic PersonicX)

– Hispanic Networks/Programs available in NPM Fusion database


Appendix F: Leading Global Innovators

• Apple’s a leading global innovator has become America’s most valuable company and most influential stock on the psychology of the investor market.

• Apple’s iPhone noted as the “phone that changed phones forever”, was designated as the Top Invention in 2007 by Time magazine.

• Apple’s Macbook Pro has consistently been one of the best selling laptops since its inception in 2006.

• The iPad was named as the Top Gadget in 2010.


Appendix F: Leading Global Innovators

• Samsung is a global leading tech innovator breaking repeated records of slimmer products such as LCD TVs & Blu Ray Disc Players, highest resolution cameras, and smartest cell phones such as the Galaxy, the first Droid in 2008.

• Recognized in industry for best gadgets only behind Apple.– A global market leader Samsung took No. 1 spot in U.S. cellphone market in 2008.– Enjoys #1 market share position for TVs worldwide.

Documents

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