Creating a New Age of Video Entertainment
Telecom at NABApril 15, 2008
• New entertainment services company
• 1st Complete next generation TV offering
– Comprehensive content lineup, including traditional TV, internet and movies
– Seamless integration of live, stored, downloadable and internet video
– Centered on on-demand viewing
– Personalized and tailored to the individual viewer
• Distributed through broadband service providers and national retailers
What is Building B?
Major Disruptions in the TV Industry: A Catalyst for Consumer Change70 million consumers will make Digital TV choice over the next 4 years
DVRDVR
HDTVHDTV
TripleTriplePlayPlay
DigitalDigitalTransitionTransition
InternetInternetContentContent
MobileMobileVideoVideo
Inflexible bundles
Too expensive
Difficulty making
everything work together
Inconvenient start times
Movie selection (on-
demand)
Can’t find something of interest to watch
Poor navigation
and usability
The picture quality does not meet my expectations
Complaints Include High Prices, Inflexible Bundles and a Poor Experience
Value is critical
Opportunity to improve the experience
Simplicity is key
Upgrade to HD
Current Approaches are Not Working
• Broadband is challenged to deliver HD television
• A pile of special purpose boxes
‒ Television STB / DVR
‒ Movie boxes
‒ Internet video boxes
• Legacy systems are difficult to upgrade
Upgrading Existing Infrastrucure is Prohibitively Expensive
IP backbone providers will not be able to economically light the existing and new fiber necessary to deliver broad
based TV access at reasonable consumer prices.- 2007 Telecom Predictions Report, Delloite and Touche Consulting
The Key: Align the Network with Content Viewership
Source: Nielsen HH ratings 2005-2006 TV season
PremiumContent &
MoviesABC, NBC, CBS, FOX,
Univision, Telemundo, My
Network, CW, Telefutura, other
independents
53%
0%
34%
Leading Networks
Niche Networks
Broadcast
Networks
Short-Tail (87% of TV viewing) Long-Tail
7%
Internet
Video
Video Delivery Cost Optimized by Combining Broadcast and Broadband
Vie
wers
UnicastPrivate BroadcastBroadcast
Group Delivery Deliver to All Direct
Least Expensive Most Expensive
Digital TV Spectrum Broadband
Video Imperatives for the Broadband Industry
• Differentiated television offering
• A complete content lineup (including HD)
• Works in America’s homes today—with existing broadband
• Limited infrastructure investment
• Enhanced brand and customer relationships
Simple
Self-Install
Compelling
Pricing
Relevant
Advertising
Wireless
Personalization
and
Intelligence
Time Shifting and
On-Demand
Comprehensive
Content
Breakthrough
Video Entertainment
Solution
Unlocking the Next Generation of Television
• Low entry cost
• Simple out of the box setup
• Tailored to individual viewer's routines and preferences
• High Definition and On-Demand
• Community and Web Features
• Broadcast networks and local channels
• Cable networks
• Studio library channels
• PPV movies and events
• Internet content
• Delivered straight to the living room television
• No need for a PC
• Works with any broadband service
Accessible
Comprehensive Content
Works in Homes Today
Personalized Experience
Breakthrough video entertainment service to be launched in 2008
The Industry Has an Opportunity to Capitalize on a New Chapter of Consumer Video
Content
Providers
Broadband
Service Providers
Advertisers
Broadcasters
Broadcasters:
Receive returns on their digital investment
Revitalize their business with targeted and interactive ads
Advertisers:
Deliver higher value advertising on television
Improve the effectiveness of advertising
Broadband Service Providers:
Offer a differentiated triple play
Avoid expensive infrastructure
Promote their brand
Content Providers:
Extend content to new platforms
Leverage brand in an on-demand world
Building B is A Turn-key Video Solution for Broadband Service Providers
Differentiated video services
High-capacity wirelessnetwork for content delivery
+ =
Telco's and ISP’s
DSL and 4G Wireless
Voice & data services
Marketing & distribution
Triple Play
Building B Partnership Model Partnership Roles
Co-Branded
Customer Relationship
Bundling and Pricing
Customer Acquisition
Set-top-box ownership
Network & content operations
1st and 2nd tier customer support
3rd tier technical support
&Partner
Partner
Partner
Partner
Partner
Partner
The Time is Now
• Major partnerships complete
‒ Broadband providers
‒ Content providers
‒ Advertisers
• Created nationwide content distribution network
‒ Broadcast partners in initial launch markets
‒ Infrastructure Partners
‒ Announced with Harris Corporation and Sun Microsystems
• Commencing trials for commercial pilot
Creating a New Age of Video Entertainment
Telecom at NABApril 15, 2008