A global force in online video

Entertain.

Inform.

Engage.

An overview of RTL Group’s digital strategy

January 2017

2

Multi-channel

networks

3

Advertising

technology

4

TV = Total Video

Agenda

2

1

Evolution of the

video market

The television business is becoming more and more competitive

Competition

More

channels

Convergence

More

players

Complexity

More

choice

3

Fragmentation is accelerating

1950 2016

TV

channels

Online

channels

4

High-end drama Entertainment Digital-first

MAINSTREAM NICHE PREMIUM NICHE DIGITAL

New distribution platforms allow for niche productions

MAINLY AD FUNDED MAINLY PAY FUNDED

5

Our families of channels have built strong non-linear services

6

GERMANY

TV Now 6 channels available

in one offer

NETHERLANDS

+29% video views

(2015 vs 2014)

FRANCE

900m video views

in 2015

2

Multi-channel

networks

3

Advertising

technology

4

TV = Total Video

Agenda

7

1

Evolution of the

video market

8

Illustrative

Content Aggregation Distribution

Broadcasters/networks Cable/DTT/DTH Studios/Production companies Linear

Multi-channel networks OTT “Channels” / Content Creators Non-

linear

The role of MCNs is similar to that of broadcasters – they aggregate channels and sell advertising

MCNs provide a range of services to content creators including production,

audience development, distribution and monetisation

Zoella El Rubius RCL Beauty

101

Strong digital brands covering key themes

9

Partners

#1 IN FASHION/BEAUTY

#1 IN PRE-SCHOOL KIDS

#1 IN HIP-HOP

Examples: non-exhaustive

Gaming Music Sport News Entertainment & Comedy

Kids Lifestyle Fashion & beauty

Fashion MCN1) #1

9

16

2014 2015

VIDEO VIEWS

In billion

Massive video view growth establishes RTL Group as clear #1

+78%

VIDEO VIEWS

In billion

Global MCN1) #1

24

602)

2014 2015

10

+150%

Source: Internal figures, consolidated view for BroadbandTV, pro-forma for StyleHaul and Divimove, 1) SocialBlade ranking Jan. 2016, 2) BroadbandTV 2015 video views include YoBoHo

VIDEO VIEWS

In billion

European MCN1) #1

6

16

2014 2015

+167%

2

Multi-channel

networks

3

Advertising

technology

4

TV = Total Video

Agenda

11

1

Evolution of the

video market

RTL Group aims to improve monetisation skills and reach new inventory segments

Build premium

non-linear

video services

Build scale

in web original and

short-form video

Build new sales competencies

with cornerstone investment

in digital programmatic advertising

US ranking

of delivered ads

In billion

(comScore, March 2016)

1 Yahoo / BrightRoll 3.6

2 RTL Group / SpotX 2.7

3 AOL / AdapTV 2.6

4 Facebook / LiveRail 1.9

12

Campaign-based sales

People-driven sales

Premium typically sold

directly

Impression-based buying

Auctioning (in real-time)

High volumes increasingly

sold automated

High CPM

Lower CPM

Catch-up TV

Multi-channel

networks

OFFERING

Web original

content

MONETISATION

1

2

3

13

Monetisation models get more complex

TV

Content

(long-form)

Non-TV content

(mainly short-form)

Advertising inventory volume

Technology is a key driver

Improve monetisation skills

Leading video ad

monetisation platform

Scale in US,

global reach

State-of-the-art

ad technology

TV

Content

(long-form)

Non-TV content

(mainly short-form)

Advertising inventory volume Source: RTL Group estimates based on Magna Global, Siemer, eMarketer, Forrester Research

9.4

8.1

24.8

2018

2.7

15.4

Traditional

Programmatic

2013

5.4

3.1x

Global market for online video advertising

In USD billion

14

Pioneer in

programmatic TV

Audience

optimisation

Acceleration steps to build ad-tech stack

Add-on investments (also minority stakes)

Extend

capabilities

2

Roadmap in

execution

Grow assets

1

✔ ✔

Secure EU-footprint

with acquisition

3

Strengthen

European presence

On going through SX

and also Smartclip

4

Build ad-

server

Widen ad tech

family and group

wide projects

(✔) ✔

15

2

Multi-channel

networks

3

Advertising

technology

4

TV = Total Video

Agenda

16

1

Evolution of the

video market

BROADCAST DIGITAL CONTENT

Video is at the heart of our strategy …

Develop and optimise new offers

Grow global brands

Capture digital growth

17

SALES

Solutions for convergent

video advertising

USAGE

Capture long and

short-form video growth

BROADCAST

DIGITAL CONTENT

… as broadcast, content, digital merge into Total Video

PROGRAMMING

Build brands for

mainstream and niche

TECHNOLOGY

Cross-screen

media technology

18

TOTAL VIDEO

2013 2014 2015

DIGITAL REVENUE

In € million

Advertising

Non-advertising

233 295

508

Digital has become a key driver of RTL Group’s top-line growth …

ONLINE VIDEO VIEWS RTL GROUP

In billion

17

36

105

2013 2014 2015

+72.2%

4.0% 8.4% % of total RTL revenue

19

Source: all internal figures

… further improves RTL Group’s well diversified revenue mix

RTL GROUP 2015 REVENUE SPLIT

In %

20

49.4

4.3 4.1

22.0

8.4

11.8

€6.0bn

TV advertising

Radio advertising

Platform revenue

Other diversification

Digital

Content

Other revenue

TV advertising

61%

49%

DEPENDENCY FROM TV ADVERTISING

A GLOBAL FORCE

IN ONLINE VIDEO

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