NEW BUSINESS PITCH

Mobilizing Your World

AT&T

NAME BRAND PITCH TYPE

Creative and Media

MARKET DATE

June 10 , 2016

The Data You Need to Win This Pitch

DESCRIPTIONAT&T’s Announcement: "We've begun a formal advertising media and creative agency review that will cover all traditional and digital services in the U.S. for our Entertainment Group, Business Solutions and Corporate Brand work." (Adweek)AT&T is looking to adopt "a single integrated media and creative operating model made up of affiliated agencies. Doing so will improve efficiencies, quality and consistency across our portfolio."Current & Previous Agencies: The primary media incumbent is WPP’s MEC, which won a consolidation review back in 2007, when the client was spending an estimated $2.3 billion annually. Prior to that review, five shops handled the business including MEC, Digitas, GSD&M Idea City, Initiative and OMD.

AT&T launches creative andmedia review

thUnited States

Client Profile / Market

AT&T, Inc. provides telecommunication services and products, including wireless communications, local exchange services, long-distance services, data/broadband and Internet services, video services, telecommunications equipment, managed networking and wholesale services.

The brand has four main segments: Business Solutions, Entertainment Group, Consumer Mobility and International. The Business Solutions segment provides services to business, governmental and wholesale customers and individual subscribers who purchase wireless services through employer-sponsored plans.

The Entertainment Group segment provides video, Internet and voice communication services to residential customers in the U.S. and U.S. territories. The Consumer Mobility segment consists of AT&T Mobility operations which provide wireless services to consumers, and wireless wholesale and resale subscribers located in the U.S. or U.S. territories. Services include data and voice services, including long distance and roaming services.

The International segment provides video entertainment services to residential customers in Latin America and wireless data and voice communication to consumer and business customers in Mexico. The company was founded in 1983 and is headquartered in Dallas, TX.

FINANCIAL OVERVIEWCOMPANY BACKGROUND

MAIN COMPETITORS

2015 Sales (mil)

2015 Employees

Employee Growth Percent

Assets (mil)

Net Income Growth Percent

Sales Growth Percent

146,801

281,450

15.5%

402,672

103%

10.8%

AT&T in the U.S.

U.S. OPERATING REVENUES

$146

AT&T Wireless customersIn the U.S. and Mexico

$139.6

49%

Entertainment Group

24%

Consumer Mobility

24%

International

3% Business Solutions

Million

Revenues bybusiness segment

Billion

AT&T Business Solutions

AT&T Business Solutions serve

$3.5MILLIONBusinesses

Including almost all the top Fortune

1000

Operates in nearly 200 countries

and territories

$3.6bAT&T’s 2015 Advertising expense

AT&T DATA PATTERNS

AT&T is partnering with Clear Channel Outdoor Americas, one of the world’s largest outdoor advertising companies to provide data that lets the company track people’s travel data via their mobile phones. Using that information with demographic information, Clear Channel hopes to provide advertisers with information to help them plan more effective, targeted campaigns.

- Adage DataCenter -

Fast Food industry in numbersAT&T Consumer Mobility

"AT&T is dramatically turning itself into an integrated carrier"

David Christopher, AT&T Mobility CMO

Bringing 4G LTE network to 10 Million

Ford cars by 2020.

Launching its Digital Assistant for

customers of its Digital Life services.

Partnering with IBM, CISCO, Deloitte, Ericsson

and GE, to facilitate a series of ambitious

projects to make cities more efficient, including smart sensors and using connected technology.

32.5%AT&T’s market share of wireless subscriptions.

2.5 GbThe monthly average Mobile Data consumption in the U.S.

13%Percentage of car drivers using connected cars in the U.S.

25%Of Household in developed economies will use digital assistants

as primary interface to connected home services by 2019.

- Gartner-

Fast Food industry in numbersAT&T Entertainment Services

$49bIn 2015, AT&Tacquired DirecTV for AT&T is now the

Largest Pay TV provider in the world

26 Million customers

in U.S.

191 Million customers in Latin America

$35.3bIn revenues in 2015. Bigger than Big Media

players like Time Warner, Fox, Viacom and CBS.

Fast Food industry in numbersAT&T’s OTT Services Evolution

AT&T with The Chernin Group formed OTTER MEDIA.

A venture to acquire, invest in, and launch over-the-top services

with a budget of $500 Million

2014 2014 2016

Otter Media foundedEllation to build between 30 and 50

separate niche online video channels appealing to highly engaged audiences

willing to pay for premium content

In 2016’s E3 convention Ellation announced the launch of a new

digital MSO called VRV

VRV has signed licensing deals with leaders in those verticals like

Rooster Teeth, Seeso, Nerdist Alpha, Geek&Sundry, Cartoon Hangover, and Ellation’s own

Crunchyroll.

VRV is a new subscription service that will house content targeted at

viewers who enjoy genre and gaming related entertainment, including fantasy, animation,

comedy and tech.

In 2014 Otter Media purchased a big stake in YouTube’s MCN

FULLSCREEN MEDIA.

2014

In December 2013 Otter Media acquired a controlling interest in CRUNCHYROLL for

about $100 Million

In 2014 Otter Media acquired Creativebug for about 10 Million

13-to-30-year-old targeted

programming

Over 600 Million subscribers

More than 5 billion Monthly

Video Views

Audience who are passionate about making and creating

Subscription based anime

service

Over 750k subscribers

1.5 billion minutes of

streaming video every month

75% paid subscribers

under 35

18 Years old median age of

free viewer

Launched its SVOD service in

April ‘16

Otter Media’s Digital MSO: VRV

“We’re focusing on a particular audience segment. While most of the big, broad platforms are really focused on delivering video in a more

one-dimensional experience, we’re trying to expand beyond the video in different ways to super serve that audience.”

When Ellation surveyed its viewers, it discovered that the most typical identifier was “gamer.” CEO Tom Pickett described Vrv as attempting to serve this broader gamer ecosystem.

Tom Pickett, Ellation CEO

“VRV was created to unite passionate fans around the content they love. Premium channels like Crunchyroll, Rooster Teeth, and the comedy streaming channel Seeso are working hard to bring new and improved programming to

their communities. While each of the audiences are unique, they have a significant amount of overlapping interests.”

Tom Pickett, Ellation CEO

VRV WILL OFFER A VARIETY OF PAY OPTIONS

FULL SUBSCRIPTION BUNDLES A-LA-CARTE FREE,

AD-SUPPORTEDROOSTER TEETH

ANIME FANS GAMERS COMEDY NERDS

GAMERS• • •

• • •

QUICK DEFINITION This segment includes people who are passionate about games on multiple platforms, from PCs, to consoles, to smartphones.

For them, gaming is a 'serious hobby,’ even a sport.

SOCIAL MEDIA FOOD ELECTRONICSENTERTAINMENT

76%

GAMERS

Gamers - AT&T’s audienceAdherence

AT&T’s audience shares 76% of

Gamers’ preferences in areas like

Social Media, Entertainment, Food

and Electronics.

AT&T’S AUDIENCE CROSSOVERS

TOP INFLUENCER BY CONSOLE

GAMERS: SOCIAL MEDIA

OF GAMERS SHARE VIDEO GAMING CONTENT ON SOCIAL

27%

PEWDIEPIE SMOOTH MCGROOVE

TOBUSCUS

OF SOCIAL VOLUME REGARDS XBOX-RELATED CONTENT42%

NINTENDO GAMERS SHARE

39%

Gamers represent about 1/10 of AT&T’s audience.

This segment sparks a strong gamer attitude, With most popular

game-specific trait being “Hardcore Gamers”.

AT&T customers are slightly interested in public figures (51.2

popularity).They are engaged by Comedians,

Actors & Directors.OF ALL VIDEO GAMING CONTENT

35%OF BIG SPENDING GAMERS

USE ONLINE VIDEO TODISCOVER NEW GAMES

PLAYSTATIONXBOX NINTENDO

GAMERS: ENTERTAINMENT

TOP MOVIES

THE AMAZING SPIDER-MAN

CAPTAINAMERICA

IRONMAN

AT&T’s audience consumes high quantity of entertainment content (entertainment junkies 32.2%) but there’s no prominent preference of

one specific form.They are movie lovers (27.9%) as well

as TV Show Lovers (27.6%).

The favorite movie genres are Animated, Action & Adventure and

Comedy.AT&T’s audience loves The Amazing

Spider-Man (119.4 rel) but their favorite movie is Grown Up (131.0)

AT&T’S AUDIENCE CROSSOVERS

KNOWMORE

FAVORITE MOVIE GENRES

ACTION & ADVENTURE

SCIENCE & FANTASY

ANIMATED FILMS

KNOWMORE

ENTERTAINMENT JUNKIES38.5%

MOVIE LOVERS45%

88%RECOMMEND MEDIA &

ENTERTAINMENTPRODUCTS

GAMERS WHO FOLLOW ONLINE

GAMING CHANNELS SPEND

1.2 XFOR ENTERTAINMENT

GAMERS: FOOD

TOP FOOD BRANDS TOP BEVERAGE BRANDS

MONSTERENERGY

MOUNTAINDEW RED BULL KNOW

MOREKNOW MOREPRINGLES JACK LINKS SKITTLES

83%RECOMMEND FOOD & DRINK PRODUCTS

AT&T customers are similar to gamers when it comes to food.

They love Food To Go (pop 157) and snacking (172.7 pop) but their

favorite beverages are Water & Juices (164.8) , while Soft Drinks (156.2)

follow at 2nd place.

The gamer’s favorite food & beverage brands collect positive popularity and

relevance points also on AT&T customers.

They take different choices when it comes to the restaurants. Where

Subway is the undisputed favorite.

AT&T’S AUDIENCE CROSSOVERS

FOOD TO GO

(popularity index)146.8

FAVORITE RESTAURANTS

KNOW MORE

161.1(popularity index)

SOFT DRINKS

GAMERS: ELECTRONICS

AT&T customers are tech-savvy.The Techies trait involves the

14% of the audience and scores high popularity points.

They share the Gamer’s early-adopters mindset

(Tech-Splorers 168.6 pop) but Razer collects low relevance

points (66.1) while Turtle Beach (120.4 rel) seem to attract

interest.

AT&T’S AUDIENCE CROSSOVERS

TOP HARDWARE BRAND

KNOW MORE

TOP CONSUMER ELECTRONIC BRAND

RAZER TURTLE BEACH KNOW MORE

GAMERS WHO FOLLOW ONLINE

GAMING CHANNELS SPEND

155.0(popularity index)

TECHSPLORERS

87% RECOMMEND CONSUMERELECTRONIC PRODUCTS

1.5 XFOR ELECTRONICS

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