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2011 in Digital: Transitioning To a Post-PC World

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Publishing Model

HTML only websites

Email – Text only

E-Commerce

Flat Content – Digitization of news, books, music and other media

Siloed Services – Search agents/shopping agents

SMS (Short Message Service)

• Collaboration

• Shift from flat “push publishing” web to creativity, information sharing and collaboration (social networks, blogs, wikis, etc.)

• Content Ownership – Users “own” the information

• MMS (Multimedia Messaging Service)

• Personalization

• Connection of siloed information to create more personal environments

• Social Media Sharing – Robust network of users sharing media across the globe

• Mobile Applications – Digital distribution of rich media and gaming applications

• Rich Mobile Platforms – Widespread adoption of smartphones

• “Intelligent Web” – People

• Recommendations automatically served based on user’s web habits

• Ubiquitous Connectivity –Widespread broadband adoption, mobile Internet access & devices

• Open Identity – Ability to seamlessly use one “screen name” to access the entire web

• Semantic Web – Ability of the internet to “understand” and respond with relevant response

• Ubiquitous Collaboration – Widespread and highly viral creative content collaboration between brands and consumers

We Have Entered the Post-PC Era

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Before 2011 Began, Gaming & Entertainment was Reimagined with Xbox Kinect

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Q1: Smartphones Outship Feature Phones, Ushering in a New Era of Mobile

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Social Sharing (& Music) Drives Usage Up

Mobile Search Grows 4-Fold

Mobile Commerce Takes Off And Advertisers Follow…

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Mobile is More Human

• More Connected with always on, always on you access

• More Accessible with voice, motion and location awareness as user interface

• More Fun through social networking, music, video, gaming

• More Affordable with WiFi nearly ubiquitous and pricing tiers

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US Mobile Ad Spending to Reach $4B by 2015

Smartphones shift ad formats from messaging to rich media & video

Search sees strongest growth

Mobile enters global advertisers playbook in 2011

15M 3G subscribers in Russia (Q2 ‘11)According to MTS Retail 2.8 million

smartphones have been sold in Russia in H1 2011 (28% higher than in H1 2010.

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Mobile Mobilizes Commerce2012

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Q2: Time Spent on Social Sites Surpasses Portals

Today…Social Media Cannot Be Ignored

Social media accounts for 1 out of every 6 minutes spent online in the U.S.

Source: The Network Effect: Facebook, Linkedin, Twitter & Tumblr Reach New Heights in May. comScore Media Metrix, June 2011.

10© 2011. All rights reserved. VivaKi. Proprietary and Confidential.

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Russia is a Leader in Social Usage

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US Social Ad Spending to Reach $4B by 2012

• eMarketer estimates that US ad revenues at social networking sites will exceed $3 billion this year

• Social networking sites will claim 10.8% of all US online ad spend this year (2011) and will garner 12.1% in 2012

• Worldwide social network ad revenues will near $8 billion

• Facebook will represent >7% of total online revenues

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Valuing Social Media2012

We know Social can play a strong role in engagement, branding and acquisition

But we need to invest more resources in understanding how it works in context with all media

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Q2: TV Universe Declines for the 1st Time Ever

A25-54 A18-49 A18-34

3.0

2.2

2.62.7

1.9

2.3

2.6

1.9

2.2

2.5

1.8

2.1

2.5

1.6

2.1

2007 2008 2009 2010 2011 (STD)

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Video Drives Display Ad Spending to Surpass $20B by 2015

Online video leads growth – accounting for a third of all online spend by 2015

• According to comScore, there have been 42.3 million users in Russia, who watched an online video• They spend 12 hours and watch 101 videos a month on average.

• A18-34 adapting to on-demand video quickest

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100% professionally produced studio TV content that is

repurposed for online viewing.

Long Form TV Professional OnlineProfessionally produced short

form TV and professionally produced online content

Aggregated ContentPublishers that aggregate content

from multiple sources.

COST

SCALE

Managing an Increasingly Complex Digital Video Marketplace Requires New Approaches

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Creating More Supply2012

• 100+ Content Producers/Talent creating and curating channels

• January launch / Sept. upfront• Can buy-out genres, channels or ROS

– sold only thru YT

24+ hours of video is uploaded to YouTube every minute and 2+ billion videos are viewed every 24 hours.

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Q4: AOL + MSN +Yahoo!: Frenemies Join Forces

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The Buying Landscape Is Getting More Crowded

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Crowded Value Chain = CPM Leakage

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Creating Value for Clients & Partners2012

Automating media buying with a focus on premium

partners

Leveraging data to create pinpoint accurate audiences

Turning results into actionable insights

Targeting Inventory Analytics

Talent & Technology

Dedicated expertise that exclusively focuses on a rapidly evolving & complex marketplace

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US Display Ad Spending to Near $15B in 2012 – 50% of Which Goes to the Big 5

• eMarketer predicts US display ad spending to be $14.82 billion in 2012, representing 40% of all online media spend.

• Over half of that is captured by the Big 5: Facebook, Yahoo!, Google, Microsoft and AOL

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Global Growth Opportunity for Top 5 and Top 25

• 81% of Big 5 monthly uniques are international

• The Top 25…look beyond US borders for opportunity (Yandex, Mail.ru in top 25)

2012

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Create Content that Crosses Screens

[YOUR AD HERE] [YOUR AD HERE]

[YOUR AD HERE]

2012

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2012

• 73% growth in Internet users since ‘08• Second largest market in Europe

• Smartphone sales up 28% YAY

• Top 5 market for social network usage

• High video consumption, limited supply

• Strong growth by top local players (and increased investment by Top 5)

Lead the Change

© 2011. All rights reserved. VivaKi. Proprietary and Confidential.26

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