Quickflix 2010 AGM
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quickflix.com.au
Annual General Meeting29 November 2010
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quickflix.com.au
Highlights Australia’s leading online movie subscription
brand
Over 66,000 active transacting subscribers
Double digit growth rate per quarter
Revenues of $9m p.a (current run rate) tracking upwards with subscriber growth
Subscription contribution increasing with scale
Funded to increase share of video rental market
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quickflix.com.au
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Subscriber growth to build market share
Over 66k subscribers using the service today
– Total subscribers up 70%– Paying subscribers up 40%
Revenue run rate up 35% to $9M in Sep 10 qtr
Targeting the mass consumer market of over 6m households in city and regional who already own a DVD or Blu-ray player- no set top box or additional device required to access our service
Most popular subscriptions fees at approx $20 per month
Introduction of subscription video on demand will drive faster growth and greater consumption
Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-10 Nov-100
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Trialists Paying subscribers
Subscriber growth accelerating
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quickflix.com.au
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Subscriber acquisition rate increasing at reduced cost Quickflix is adding new subscribers
at double the rate of a year ago
Marketing cost to acquire each customer has fallen 50%
Word of mouth referral is generating 1 in 3 of sign-ups
Retention levels maintained despite high growth rates
Strong finish to FY10 driving growth in early FY11
FY10 Q1 FY10 Q2 FY10 Q3 FY10 Q4 FY11 Q1-
5,000
10,000
15,000
20,000
25,000
30,000
-
10
20
30
40
50
60
New sign-ups (# LHS) Marketing CPA ($ per sign-up)
FY05 FY06 FY07 FY08 FY09 FY10 FY11 Q1 -5%
0%
5%
10%
15%
0%
15%
30%
45%
Trialist % of total subscriber base (average,RHS)Paying subscriber net churn (average % per month,LHS)
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quickflix.com.au
Physical DVD rental and retail stores market in decline. PayTV growing slowly with challenges to maintain high ARPU. Kiosks limited by sub-scale network. Set top box penetration tiny. Few barriers in the way of Quickflix sustaining growth.
Quickflix subscription DVD & bluray rental DVD & bluray retail PayTV subscription
9
600
1,300
2,000Revenue ($M)
Quickflix: high growth in a $4B market
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quickflix.com.au
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Quickflix: 43,000 movies and
TV titles, adding 400 per month.
Everything from latest release box
office hits to classics, foreign, arthouse,
sport and documentaries.
Competitive advantages: Massive range of content, first release window after cinema
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10-
10,000
20,000
30,000
40,000
50,000
60,000
Quickflix growing its title range and subscriber base
Title range (# titles)Subscribers #
Cinema: 20 TitlesKiosk: 30 titles
Fetch TV: 100 movies + TV Channels
Video store: ~2,000 titles, rotating
Foxtel: ~2,500 titles rotating + TV channels
iTunes:~4,000 movies + TV show
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quickflix.com.au
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High customer engagement. Quickflix is a fun part of our subscribers’ day and social interaction.
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quickflix.com.au
Now 2011 FutureDVD Subscription
Simple low cost subscriptionOver 43,000 titlesLatest release and classicmovies, TV, sport, music, documentariesHigh quality and portable DVD & Blu-ray formatsAvailable to anyone with a DVD player and internet
add Streaming
Digital streaming + DVDLow cost subscriptionInstant streaming access to the lounge room & mobile“Value” content bundlesPremium PPV titlesOTT delivery to selected devices to maximise reachAvailable to anyone with adequate internet and a compatible deviceNo new STB required!
Any movie anytime anywhere
Expanded digital service + DVDBroad consumer choice across titles, format, quality & deviceDeep digital libraryInstant streaming to most popular devicesCentral entitlement, “buy once” for TV, PC, mobileBroaden addressable consumer base
Quickflix subscription with digital streaminglaunching 2011
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quickflix.com.au
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Subscription profitability improving with scale Subscription model provides a recurring revenue stream Current capital resources applied to drive growth to $20M p.a revenue Self-funded subscriber growth accelerates from $20M p.a
Annu
alis
ed R
even
ue $
M
$10 M $20 M $50 M $100 M$0 M
$20 M
$40 M
$60 M
$80 M
$100 M
$120 M
-
100,000
200,000
300,000
400,000
500,000
600,000
Service costs
Overhead
Content investment
Contribution for Marketing/Profit
Paying subscribers (RHS)
Estimated cost and contribution rates at future revenue levels*
*Revenues and costs based on DVD subscription model only
Paying subscribers
Funded growth
Self-funded growth accelerating
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quickflix.com.au
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The year ahead Double revenue and subscriber base in 18
months and achieve self funding growth To do this we plan to:
– increased marketing activity to attract subscribers, spending $4M p.a
– increase our investment in content to over $2M p.a
– fund subscriber growth from operating cash flow & our capital resources
Continue to develop the best consumer offering in the marketplace which includes launching our subscription digital delivery service
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quickflix.com.au
Entertainment, delivered
Thank you.
Any questions? Investors- [email protected]
Media- [email protected]