Grouper 3.0 / Crackle Update

June 2007

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Executive Summary

• From acquisition to-date, SPE has focused on integration and audience expansion

– Leveraged SPE content and marketing strength (Seinfeld, Rescue Me, Spiderman)

– Integrated Grouper into Sony hardware platforms (PSP, VAIO, Bravia)

– Increased on-site audience and established distribution network to 100+ million monthly streams

• The market for user-generated video has evolved since our acquisition of Grouper

– Competition among general UGV sites continues to intensify

– Proliferation of low quality video is making it harder for users to find compelling content

– Advertisers want to associate their brands with higher quality content

• SPE and Grouper are uniquely positioned to exploit the emerging market opportunity

– Leverage Sony content expertise to marry Hollywood quality with viral nature of UGV

– Utilize programming and incentives to attract and feature the best content

– Syndicate the viral player and channels across the Global Video Network

– Monetize audience through advertising sales by SPTAS and rep firms

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Q1 '05 Q2 '05 Q3 '05 Q4 '05 Q1 '06 Q2 '06 Q3 '06 Q4 '06 Q1 '07 Q2 '07

Uniq

ue U

sers

(M

M)

Historical Growth of Grouper and the Global Video Network

Grouper 1.0“Share your videos

with friends”

Grouper 2.0“Share your videos

with the world”

SPE Acquisition

Grouper 3.0“Marriage of Hollywood Quality & Viral Video”

Mar ‘05

Nov ‘05

Aug ‘06

Growth of Global Video Network

July ‘07

* Excludes ValueClick customers

Grouper has seen significant growth in its audience since acquisition

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Integratedwith SPE

Integrated Across Sony

FY08Initiatives

• Grouper in the PSP firmware

• Grouper service on IP-enabled Bravia

• Integrating Grouper for video sharing with Sony Ericsson and Sony Digital Imaging

• Grouper screensaver on all VAIOs

• Licensing content for digital delivery on PS3, including HOME initiative

• Unique SPE content offering -- ScreenBites

• DVD promotion for Seinfeld Season 7

• Contests for SPE theatrical releases (Pursuit of Happyness & Spider-Man 3)

• Firehouse channel tie-in with Rescue Me

Grouper’s Support for “Sony United”

Digital Imaging

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Evolution of the Grouper Home Page

AT ACQUISITIONImmersed Users in a Wide Variety of UGV

TODAY Presents Editorialized Content on a Channel Basis

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“Hollywood” Content Viral VideoThe Opportunity

• High quality content viewed by many

• Less viral and offers less variety than UGV

• Combine the viral nature of user-generated video with the quality of “Hollywood” content

• Unlimited variety of content• Highly viral• Lacks quality of traditional

studio content

Number of Videos in the Category

Nu

mb

er

of

Vie

we

rsThe Grouper 3.0 Opportunity

Product re-launch positions Crackle to exploit the “mid-tail” strategy of online video

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Key Tenants of the Grouper 3.0 Strategy

Content Fame Distribution Monetization

Product

• The best content not on TV

• Programmed in narrowly defined channels

• Institutionalize Fame

• Offer incentives that money can’t buy (status, distribution)

• Syndicate through network of partner sites

• Integrate with Sony hardware

• Leverage SPT Ad Sales relationships

• Monetize through ads and channel sponsorships

• High quality video playback

• Fame partner brands tightly integrated

• External player syndicates full experience

• Support for a wide range of ad types

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