Parsing the Mayhem: Developments in the Advertising Technology Landscape May 3, 2010 Terence Kawaja GCA Savvian Advisors

Parsing the Ad Tech Value Chain ANALYTICS INVENTORY INVENTORY Media SUPPLY AGGREGATION Where? DATA DATA AUDIENCE DATA MEDIA Audience SUPPLY AGGREGATION SEGMENTATION OPTIMIZATION BUYING Who? CREATIVE CREATIVE Creative ORIGINATION OPTIMIZATION What? ANALYTICS

Display Advertising Technology Landscape Agencies Media Buying Ad Ad Networks Sharing Data DSPs Platforms Exchanges / Social Tools Horizontal Trading Desk A P D U A Video / Rich Media Yield V Optimization B U E L D R Vertical I I T E S I N Targeted Publisher H C S Creative Data Data Exchanges / Tools E E Optimization Optimization E Aggregators R R Performance S S Ad Servers Ad Servers Analytics Verification / Mobile Data Suppliers Attribution Ad Ops / Infrastructure Please direct any inquiries or comments on the landscape to Terence Kawaja at tkawaja@gcasavvian.com or (212) 999-7082

Lets Not Forget About the Principals

Landscape Observations Agencies Media Buying Ad Ad Networks Sharing Data DSPs Platforms Exchanges / Social Tools 1. Overcrowded Marketplace Horizontal Trading Desk A P D U A Video / Rich Media Yield V ries Optimization B U ego E L D R cat Vertical I I T 24 S E ies N pan I H Targeted Publisher C om S Data Tools E ted Creative Data E 2c Exchanges / Optimization Optimization E Aggregators ves R 19 n in R Performance S illio S Ad Servers $2 .5 b Ad Servers Analytics Verification / Mobile Data Suppliers Attribution Ad Ops / Infrastructure Please direct any inquiries or comments on the landscape to Terence Kawaja at tkawaja@gcasavvian.com or (212) 999-7082

Ad Stack - Circa 2000 Ad Operations Agency Ad Server

Ad Stack - Circa 2005 Analytics Ad Operations Ad Network Agency Ad Server

Ad Stack - Circa 2010 DSP Analytics Verification Ad Ad Operations Exchange Data Ad Optimization Network Creative Optimization Yield Optimization Data Aggregator Agency Ad Server

Display Advertising Technology Landscape Agencies Media Buying Ad Ad Networks Sharing Data DSPs Platforms Exchanges / Social Tools Horizontal Trading Desk A P D U A Video / Rich Media Yield V Optimization B U E L D R I I T $8 B Vertical E I i llion S N Targeted Publisher H C S Creative Data Data Exchanges / Tools E E Optimization Optimization E Aggregators R R Performance S S Ad Servers Ad Servers Analytics Verification / Mobile Data Suppliers Attribution Ad Ops / Infrastructure Please direct any inquiries or comments on the landscape to Terence Kawaja at tkawaja@gcasavvian.com or (212) 999-7082

Search Advertising Technology Landscape SEM Agencies SEM SEO Providers / Tools Search Engines Agencies Tools A P D U A V B U E L D R $17 I I T I Billi S E N S E on Data Optimization Data Exchanges / Performance H E R C E R Aggregators S S Analytics Verification Data Suppliers Mobile

Television Advertising Technology Landscape Agencies A TV Ad Brokers P D U A V B U E L D R I I T E S N I H C S E E E R R S S

Sizing the Market Opportunity (Fun With Math) 2010 2014 Total Online Display Ad Sales $ 8,000 $ 16,000 % Audi ence Targeted 13% 50% Audience Targeted Ad Sales 1,000 8,000 % Media Bought on DSP Platform 20% 50% DSP-based Audience Targeted Ad Sales 200 4,000 % Fees to Demand-Side Intermediary 15% 10% DSP Net Revenue 30 400 Over $400 million has been raised by demand-side intermediaries alone; over $2.5 billion on the entire landscape Illustrative analysis only

Carving Up the Stack - Network World $5.00 CPM $5.00 ($0.50) $4.00 $3.00 (C PM) ($2.00) $2.00 ($0.25) $1.80 CPM ($0.35) ($0.10) $1.00 $0.00 Advertisers Agency Ad Network Data Provider Ad Exchange Ad Serving / Publisher Rich Media

Carving Up the Stack - DSP / Exchange World $5.00 CPM $5.00 Efficiency from Optimized Media Buying $4.20 CPM ($0.50) $4.00 ($0.40) ($0.50) $3.00 (CPM) (C PM) ($0.75) $2.15 CPM ($2.00) ($0.30) $2.00 ($0.25) ($0.10) $1.80 CPM ($0.35) ($0.10) $1.00 $0.00 Advertiser Advertisers Agency Ad DSP Network Data Provider Ad Exchange Ad Exchange Ad Serving / Serving Publisher Rich Media Rich Media

Landscape Observations Agencies Media Buying Ad Ad Networks Sharing Data DSPs DSPs Platforms Exchanges / Social Tools Horizontal 1. Overcrowded Marketplace Trading Desk 2. Demand side capabilities likely A P D to amalgamate Yield U A Video / Rich Media V Optimization B U E L D R Vertical I I T E S I N Targeted Publisher H C S Creative Data Data Exchanges / Tools E E Optimization Optimization E Aggregators R R Performance S S Ad Servers Ad Servers Analytics Verification / Mobile Data Suppliers Attribution Ad Ops / Infrastructure Please direct any inquiries or comments on the landscape to Terence Kawaja at tkawaja@gcasavvian.com or (212) 999-7082

Landscape Observations Agencies Media Buying Ad Ad Networks Sharing Data DSPs Platforms Exchanges / Social Tools Horizontal 1. Overcrowded Marketplace Trading Desk 2. Demand Side Capabilities likely to A P amalgamate D U V 3. Google is Video / Rich Media to display in aB A coming Yield Optimization U E big way L D R Vertical I I T E S I N Targeted Publisher H C S Creative Data Data Exchanges / Tools E E Optimization Optimization E Aggregators R R Performance S S Ad Servers Ad Servers Analytics Verification / Mobile Data Suppliers Attribution Ad Ops / Infrastructure Please direct any inquiries or comments on the landscape to Terence Kawaja at tkawaja@gcasavvian.com or (212) 999-7082

Google is Well Positioned in Display Agencies Media Buying Ad Ad Networks Sharing Data / DSPs Platforms Exchanges Social Tools Horizontal A P D U A Video / Rich Media Yield V Optimization B U E L D R Vertical I I T E S N I Targeted Publisher H C S Creative Data Optimization Data Exchanges / Tools E E Optimization Aggregators E R Performance R S S Ad Servers Ad Servers Analytics Verification / Data Suppliers Mobile Attribution Ad Ops / Infrastructure

Landscape Observations Agencies Media Buying Ad Ad Networks Sharing Data / DSPs Platforms Exchanges Social Tools 1. Overcrowded Marketplace Horizontal Trading Desk 2. Demand Side Capabilities likely to A P amalgamate D U A V 3. Google is coming to display in a Video / Rich Media Yield Optimization B U E big way D L R I I 4. Data becomes ubiquitous and Vertical E T commoditized S N I Targeted Publisher H C S Creative Data Optimization Data Exchanges / Tools E E Optimization Aggregators E R Performance R S S Ad Servers Ad Servers Analytics Verification / Data Suppliers Mobile Attribution Ad Ops / Infrastructure

Exception: All Data is Not Created Equal Data Hierarchy Example Companies Social Sharing Value Search Intent Click Stream Publisher Cookie Segmentation

Exception: Proprietary Data Sets

Landscape Observations Agencies Media Buying Ad Ad Networks Sharing Data / DSPs Platforms Exchanges Social Tools 1. Overcrowded Marketplace Horizontal Trading Desk 2. Demand Side Capabilities likely to A P amalgamate D U A V 3. Google is coming to display in a Video / Rich Media Yield Optimization B U E big way D L R I I 4. Data becomes ubiquitous and Vertical E T commoditized S N I Targeted Publisher H C S Data 5. Life gets tougher for agencies Data Tools E Creative Optimization Optimization Exchanges / Aggregators E E R Performance R S S Ad Servers Ad Servers Analytics Verification / Data Suppliers Mobile Attribution Ad Ops / Infrastructure

Landscape Observations Agencies Media Buying Ad Ad Networks Sharing Data DSPs Platforms Exchanges / Social Tools 1. Overcrowded Marketplace Horizontal Trading Desk 2. Demand Side Capabilities likely to A P amalgamate D U V 3. Google is Video / Rich Media to display in a A coming Yield Optimization B U E big way L D R I I 4. Data becomes ubiquitous and Vertical E T S commoditized N I H Targeted Publisher C S 5. Data / gets tougher for Agencies E Life Tools Creative Optimization Data Optimization Exchanges E E Aggregators R R 6. Publishers Performance to leverage data need S S for their benefit Ad Servers Ad Servers Analytics Verification / Mobile Data Suppliers Attribution Ad Ops / Infrastructure Please direct any inquiries or comments on the landscape to Terence Kawaja at tkawaja@gcasavvian.com or (212) 999-7082

SSP = Sell Side Platform Ad Networks Sharing Data / Horizontal Social Tools P Video / Rich Media Yield U A Optimization B U L D Vertical I I E Publishers can make data S N work for them Targeted Publisher H C Tools Sell it raw E E Brand it Performance R Target better (higher CPMs) S Ad Servers Mobile Ad Ops / Infrastructure

Landscape Observations Agencies Media Buying Ad Ad Networks Sharing Data DSPs Platforms Exchanges / Social Tools 1. Overcrowded Marketplace Horizontal Trading Desk 2. Demand Side Capabilities likely to A P amalgamate D U V 3. Google is Video / Rich Media to display in a A coming Yield Optimization B U E big way L D R I I 4. Data becomes ubiquitous and Vertical E T S commoditized N I H Targeted Publisher C S 5. Data / gets tougher for Agencies E Life Tools Creative Optimization Data Optimization Exchanges E E Aggregators R R 6. Publishers Performance to leverage data need S S for their benefit 7. Consolidation likely from Servers Ad several Ad Servers Verification / buyer groupsMobile Analytics Data Suppliers Attribution Ad Ops / Infrastructure Please direct any inquiries or comments on the landscape to Terence Kawaja at tkawaja@gcasavvian.com or (212) 999-7082

Diverse Strategic Interest in Ad Tech Innovators Agency Marketing Targets Technology Network / Data Ad Networks

Strategic Ad Tech Investment Activity to Date Over $13 billion of investment activity from all potential buyer groups = Acquisition = Investment

Diverse Strategic Interest in Demand-Side Ad Tech Strategic Fit Ability / Willingness to Pay

Consolidation Will Likely Come in Waves

The First Deal Will Likely Trigger the Initial Wave

The Ad Tech Optimization Scorecard Advertisers Publishers Agencies Ad Networks DSPs Data Providers Data Aggregators

Wall Street and Madison Ave; Separated at Birth? Name Named after a street in Manhattan Unit Standardized, high volume Buyers Looking for a good ROI Sellers Looking for the highest price Agent Intermediaries Handful of global firms in New York, Europe Rating Agencies Provide independent third party measurement Distribution Channels Partner sales channel which aggregates demand Auction Marketplaces Exchanges facilitate the trading of units

GCA Savvians Digital Media Advisory Business Deep Industry Knowledge Think Like Principals Offer Trusted Advice to Clients Terence Kawaja Managing Director +1 212.999.7082 tkawaja@gcasavvian.com TOKYO SAN FRANCISCO CHICAGO NEW YORK LONDON Leading investment banking firm with over 200 professionals worldwide Services include advice on mergers and acquisitions, private capital finance and restructurings Advised on over $60 billion in transactions since 2006 Advisor to media companies new and old

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