Stan Lee’s Lucky

Man

Enders Conference, 2nd March 2017Andrew Griffith

2

3

• Proliferation of connected devices

• More ways to watch than ever

before

• Viewing taking place in and out of

the home

• Demand for faster broadband is

growing

Note: VoD refers to Free VoD (e.g. iPlayer), Paid VoD (e.g. Netflix), Sky On Demand and Short Form (e.g. YouTube). Source: Ofcom Digital Day 2010, 2014, 2016.

Graph not to scale.

Shift to on demand is accelerating

47%

2010 2016

21%

12%

4%10%

16%All adults

16-24 year olds

2014

VoD as a proportion of watching activity

4

Source: Sky data, as at Sept 2016. Daily household viewing based on Jan – Sept 2016 average. Non-live includes recorded on demand and Sky Go viewing.

‘Time poor professionals’ are are predominantly 25 – 34 year olds, living in London commuter belt. ‘Empty Nesters’ are predominantly 65 year olds or above.

Time poor professionals

64%

Live Non-live

5hrs, 14min

Dailyhousehold

viewing

94%

Connected

90%

Useson-demand

Empty nesters

6hrs, 12min

Dailyhousehold

viewing

39%

Connected

14%

Useson-demand

99%36%

5

Sports & News Kids FactualGeneral

EntertainmentMovies Quality Drama

Based on viewing to Sky and partner channels in Sky homes from July – December 2016. ‘Quality Drama” includes consumption of selected channels including Sky Atlantic.

‘Non-linear viewing’ includes viewing via on-demand, PVR and Sky Go.

% of non-linear viewing

13% 19% 25% 33% 52% 57%

Change = Opportunity

SpaceX

7

1946 1953 1960 1967 1974 1981 1988 1995 2002 2009 2016

Licence Fee Advertising Subscription Transactional

-

TV Licence fee

introduced (1946)

ITV launched(1955)

Sky Store launched(2013)

Sky launched(1989)

Based on constant prices which excludes the impact of inflation.

.

£16bn

Sky Digital(1999)

8

Best content

Best innovation

Grow Sky Store

Expand Sky AdSmart

Strengthen existing businesses Open up new revenues

9

Britannia

Delicious

Fortitude

Tin StarRivieraLucky Man

Jamestown

Guerrilla

X Factor

A League of Their

Own

Stella

Gomorrah

Mount Pleasant

The Tunnel

Babylon Berlin

10

• Taking more boxes

– 1.2 million boxes in over 600,000 homes

• Watching even more

– 10% increase in viewing

– 47% more downloads

• Transacting more

– Multiscreen penetration more than doubled

– 100% increase in Sky Store purchases

• Strong advocacy

– 72% likely to recommend it

– Winning major tech media awards(1)

(1) Sky Q has won awards from Recombu, What Hi-Fi, Stuff, Trusted Review and Pocket-Lint

11

Voice search

Personalisedhomepage

Formula 1coverage in UHD

Restart onSky Entertainment

Record six shows whilewatching seventh live

Auto recordon Catch up

Restart onSky Sports

Launch in Italy

Voice control

PersonalisedOn Demand

for Sky Cinema & Sky Store

Personalisedfavourite channels

Sky sound system & Dolby

Atmos supported UHD content

Autoplayat credit

New ways toBuy & Keep on from Sky Store

>

Launch inGermany & Austria

12

• Agnostic approach to delivering TV

• Offering Sky Q features and content over broadband

• Expanding our reach – additional 6 million homes

• Reducing installation and acquisition cost

13

Grow Sky Store

Expand Sky AdSmart

Strengthen existing businesses Open up new revenues

14

• Customers can buy or rent movies and box sets

• Instantly download digital copy

• Regularly number 1 digital retailer

• Expansion of pre-order service

15

• One of Europe’s leading advertising sales houses

• Number 1 deliverer of advertising impacts in UK

• Clear strategy to grow

– Increase our inventory

– Grow our price to reflect fair value

– Leader in innovation

– Best in class data and measurement

16

Monetising all of our viewing Data-driven targetingConnecting platforms

Serving adverts within

On Demand and Sky Go

Advertising to specific

audience groups

Playing adverts in a

controlled sequence

17

9 February 2017

25 January 201723 September 2015

“Big brands fund terror

through online adverts”

“Google charges advertisers

for fake YouTube video views,

say researchers”

“Procter & Gamble chief issues powerful media transparency rallying cry”

18

Trust

Targetability

TVLarge audiences quickly

Highest quality content

Established independent measurement

OnlineHighly targeted

Trackable customer response

Enhance capability

and richer data

Launch in

Ireland

Launch on

NOW TV

First PSB

2017

Scandal

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•

•

•

•