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Adobe Q2 2016 TV Everywhere Report

The explosive growth of TV connected devices is driving rapid change for the TV industry. ADI found that TV connected device (TVCD) sales are up 143% year over year (YoY). In addition, TVE time spent viewing on connected devices is up 149% YoY.

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Adobe Q2 2016 TV Everywhere Report

  1. 1. © 2016 Adobe Systems Incorporated. All Rights Reserved. Adobe Digital Insights Q2 2016 TV Everywhere Report
  2. 2. © 2016 Adobe Systems Incorporated. All Rights Reserved. Methodology Analysis based on aggregated and anonymous data from Adobe Marketing Cloud  Includes consumer video viewing data from 2015 and 2016  Adobe does not use any personally identifiable information to generate this report Sample information includes:  1.6 billion TV Everywhere authentications in North America  300+ different sites and apps acting as access points for TV Everywhere Solutions Leveraged: 2 Adobe Primetime Adobe Analytics
  3. 3. © 2016 Adobe Systems Incorporated. All Rights Reserved. Key Insights 3 1. TVE time spent viewing on TV Connected Devices has increased 149% YoY 2. TVCDs have become standard household devices with 143% sales growth YoY 3. An eSports app could be TVE’s gateway to the gaming masses o Gaming consoles represent ~40% of TVCDs, but less than 1% of all TVE video starts 4. Android devices drawing new TVE viewers into the market o Android share of TVE authentications up 40% YoY 5. TVE grows, but loses momentum after Q1 successes o Authenticated viewing grew 78% YoY driven by unique visitor growth
  4. 4. © 2016 Adobe Systems Incorporated. All Rights Reserved. 1 / TV Returns to the Living Room 4 • Nearly half of time spent occurs on TVCDs - further cementing TVE as a home-based activity • Browsers were the medium of choice last year, but TVE awareness and app development have progressed bolstering viewership on TVCDs
  5. 5. © 2016 Adobe Systems Incorporated. All Rights Reserved. 2 / Strong TVCD Sales Indicate Growing Market & Viewer Base 5 Online sales for TVCDs up 143% YoY  Strong, existing consumer interest in SVOD helping drive TVCD sales  Projection: 56M U.S. households have subscriptions to at least one SVOD service(Strategy Analytics, end of 2015)
  6. 6. © 2016 Adobe Systems Incorporated. All Rights Reserved. 3 / eSports: TVE’s Gateway to the Gaming Masses 6 eSports app could entice gaming audience into TVE  Gaining ground in broadcast TV  Social mentions grew 116% (since June 2014) • Large spikes: League of Legends & DOTA 2 tournaments  Twitch: Had over 100 million UVM last year (WSJ) TVE is missing a huge opportunity on gaming consoles  Consoles make up ~40% of TVCDs, but only <1% of all TVE video starts
  7. 7. © 2016 Adobe Systems Incorporated. All Rights Reserved. 4 / Android Devices Drawing New TVE Viewers Into The Market 7 Android, Roku & Macs see significant YoY Growth Android share of TVE authentications up 40% YoY  Early adopters of TVE were iOS viewers and it is now being used by a wider audience  Chromecast growth likely drawing in more Android viewers iOS share of TVE authentications down 18% YoY  Share of authentications dropped due to weak viewer growth on iOS devices; increase in viewing frequency not enough to offset
  8. 8. © 2016 Adobe Systems Incorporated. All Rights Reserved. 5 / Programming Seasonality Showing its Effects TVE growing but lost momentum after Q1 successes  Authenticated viewing grew 78% YoY, but dropped 64% QoQ  Strong growth spurred primarily by unique visitor growth  Major sporting events in Q3 expected to bring TVE viewing to an all-time high 8
  9. 9. © 2016 Adobe Systems Incorporated. All Rights Reserved. 6 / Device Viewing Frequency Remains Constant 9 Frequency on all devices remains fairly stagnant YoY:  Viewers appear to have fallen into their routines watching the same amount of videos per month  There have not been any large disruptions in technology to shift TVE viewing behaviors
  10. 10. © 2016 Adobe Systems Incorporated. All Rights Reserved. A Few Predictions 10 1. Single sign-on: Devices like Roku and Amazon Fire will follow in the footsteps of Apple TV by implementing a single sign-on solution, easing entry into TVE 2. Netflix vs Hulu: Programmers will withhold more content from Netflix to focus on Hulu, their own TVE offerings and those of MVPDs – as Netflix continues to accelerate investments in original programming 3. Pure-play AVOD services will struggle: why watch commercials when ad-free services like Netflix and Amazon are a click away? 4. Skinny bundles: MVPDs will continue creating alternatives to traditional cable TV but will struggle with the underlying economics
  11. 11. © 2016 Adobe Systems Incorporated. All Rights Reserved. Glossary 11  Viewing frequency: Video start per unique viewer  Authenticated video: Video content that requires credentials from multichannel video programming distributor (MVPD)  SVOD: Subscription Video on Demand (i.e. Netflix, Hulu, Amazon Prime)  TVCD: TV Connected device, which includes Apple TV, Roku, Chromecast, Amazon Fire, gaming consoles such as Xbox and PlayStation, and other platforms  Active monthly viewer: Viewer who authenticates at least once per month  Monthly unique visitor: Total number of unique visitors for the month  Access types: • Browser includes Chrome, IE, Firefox, and Safari on both PC and mobile devices • iOS app is an app on any Apple mobile device • Android app is an app located on any Android mobile device • Gaming console and OTT includes data from apps on Xbox, PS4, Apple TV, Roku, Amazon Fire TV, and other similar devices
  12. 12. © 2016 Adobe Systems Incorporated. All Rights Reserved.

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