Ignite Sports, Inc. iTV Opportunity and

ApproachBoard Meeting Discussion

June 20, 2002

Macro Trends Driving the US iTV Industry • Cable companies have spent >$50B since 1996 upgrading their

networks. They’ll spend $15B this year. There is intense pressure to generate returns, and Wall Street has been pounding them for it. Adelphia isn’t helping.

• In 2000, MSOs lost >$1B in revenue as a direct result of subs defecting to satellite.

• Digital adoption is growing! 103M homes this year WW, 12M in US. Cable gaining ground on Satellite worldwide – driven by US.

• Consumers are ready for interactivity> Recent CTAM study shows 79% of digital and 55% of analog subs want iTV.

• Two major approaches to driving new revenue:> Own content - Deals like TWC/AOL and Echostar/Vevendi/USANetworks > Own infrastructure – telephony, broadband, VOD, PVR, iTV; positioning for

scale through acquisition (Comcast / AT&T), franchise swapping.

Mounting pressure continues to drive the need for new services

Researchers and Analyst Predictions…

The numbers have waivered, but they are still strong

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iTV Households(millions)

Almost 60 million household will have interactive television

capabilities

US iTV Advertising Revenue reaches $2.6B in

2005

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VOD Revenues(millions)

US VOD Revenues Exceed $3B in 2005

eMarketer, March, 2002

Kegan, 2001

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2001 2005 2010

North America PVR Households

reach 100m by 2010(millions)

Informa Media Group, April, 2002

…And Their Short Term Actions

• There are signs investors, analysts see bottom> Stocks up in recent days / weeks> Sachs upgrades CVC.

• ML this week – “We maintain our bullish stance on the industry long term.”

• Sachs this week – “You gotta believe in the long term cable story.”

• FBR – “Interactive TV is a reality. Now it is just a question of how much to offer consumers.”

• Liberty creates LBIT; buys OpenTV, ACTV

The crystal ball is actually getting clearer (more later)

Fundamental Drivers Remain for Service Providers

• Searching for new revenue streams> New subscription services, VOD, iTV, t-commerce> Penetration is high, advanced content needs to drive upgrades

• Competition is driving service offerings > Cable and satellite looking to differentiate offerings from one another

• Reduce customer churn

• Options:> Broadband is a “pipe only” business> Current content relationships drive new “channels” only and dilute revenues> Telephony is complicated, will come behind interactive services> iTV – IPG, VOD, PVR, Virtual Channels, Broadcast Sync

Service Providers need iTV

Why is this taking so long?

• We’ve been talking about iTV since ’92!

• Adding text and graphics to TV hasn’t been as easy as people thought.

• Too much focus on pizza (nobody really knew what people wanted).

• Phased approach required:1. Build out a platform capable of interactivity.2. Foster applications.

• Focus on what people want.• Focus on infrastructure apps – IPG, VOD, PVR.

3. Recurring interactivity comes from acceptance.• Acceptance of IPG, VOD and PVR

• Broadcast Sync and T-Commerce are complicated both technically and from a business perspective

Infrastructure / Core applications are cleaner

Current Wisdom in iTV• Phased approach is finally happening.

> Two approaches – Content-based and infrastructure / core apps

• Content-based> Virtual Channels get you in the content game.> Broadcast sync has its own phased approach, has big rights and technical issues.

• Core applications> VOD is a major upgrade – happening now – VOD trials are positive and VOD is driving

much of the new CAPEX. – PVR as a service supplements VOD and IPG. MSOs committing.

> Few are focused on core applications – Opportunity for Ignite– Gemstar - IPG– Middleware Providers – VOD players (Seachange, Concurrent) – PVR players (STB Mfgs, TiVo, SonicBlue) – MetaTV – Portal– Ignite – Real-time content infrastructure

> Core applications are attractive because they can generate defensible per-sub revenue

• The industry is at the right phase for core iTV applications to be selected. Decisions are being made now.

Core applications (like CoPilot) are ringing true with MSOs. Now they want to see it.

CoPilot is an attractive infrastructure / core application play• CoPilot makes the IPG come

alive.

• CoPilot is the real-time compliment to the PVR.

• CoPilot is the conduit to virtual channels, *Cast products and broadcast sync.

• CoPilot starts in sports> Availability of data on other

matches / games was first on the list of iTV interests. (Accenture study ‘01)

• Targets> MSOs, Consumer Electronics,

Middleware, Hardware.

To succeed, we can’t just walk in with a publishing system…• While important, our systems only get us partly there

> Publishing is a key complimentary business to iTV with a common infrastructure– iTV-only business is rough – InformTV, Spiderdance, RespondTV, ACTV

> Publishing gets us virtual channels> Publishing gets us data for broadcast sync> Publishing gets us CoPilot data

• Still required for Ignite’s success:> Infrastructure level deployment commitment

– Motorola Horizon Program– Scientific-Atlanta Creative Edge– OCAP / MHP focus– HE infrastructure investments

> Focus on wider client base– Consumer electronics players in addition to service provider

> Key partnerships with other core app providers– VOD players– PVR players– IPG players– STB players

> Cross-genre resources

...but we know what it is going to take to get there