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This document summarizes IPTV subscriber forecasts and growth trends globally and in several key regions from 2005-2010. The EMEA region is projected to be the largest overall, while France is expected to be the fastest growing individual market. Italy is also expected to grow but remain smaller than France, and Spain and Hong Kong got off to fast starts in IPTV adoption driven by major providers in each country.

Business Santé & Médecine

Global forecasts – 35 million subscribers with EMEA the dominant region 2005 2006 2007 2008 2009 2010 EMEA North America AsiaPac 0 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 35,000,000 5,000,000 Source: Diffusion Group / Enders Analysis

France is likely to be the fastest growing market Source: Diffusion Group / Enders Analysis 1,50 5,30 2011f 4,40 2010f 3,60 2009f 2008f 2,80 2007f 2,00 2006 5,30 IPTV Subscribers France (million) – Leading players FT, Free, Neuf

Italy is likely to grow but still remain smaller than the French market Source: Diffusion Group / Enders Analysis 200,00 1.500,00 2010f 1.000,00 2009f 2008f 800,00 2007f 400,00 2006 5,30 IPTV Subscribers Italy(‘000s) – Leading players Fastweb, Telecom Italia

Spain has got off to a fast start with Telefonica signing up 383,000 customers in 2006 Source: Telefonica / Enders Analysis 5,30

Hong Kong is dominates IPTV forecasts for Asia Pac Source: PCCW/ Diffusion Group / Enders Analysis 800,00 4.440,00 2010f 3.053,00 2009f 2008f 2.200,00 2007f 1.540,00 2006 5,30 IPTV Subscribers Hong Kong (000s) – Leading player PCCW (Now.Tv)

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2015 performance The latest box office data suggests that the public can still be persuaded to visit the cinema for the right film content (double digit growth in admissions in some large European markets). International films such as Jurassic World, Minions, Spectre and Star Wars and domestic content (e.g. Ocho Apellidos Catalanes in Spain and Les Nouvelles aventures d'Aladin in France) should help cinema operators achieve a strong financial performance in 2015. The year also saw the private equity investors, Bridgepoint and the ambitious Mexican chain, Cinepolis make substantial investments in European cinema, whilst Terra Firma started to look for a buyer for the Odeon & UCI Group. The shares of listed European operators (Cineworld, Kinepolis) have had a good performance compared to their US peers (Cinemark, AMC, Carmike, Regal). The US operators tend to have a regional or urban/suburban focus and in some cases (Cinemark) have expanded into Latin America. Long term outlook Whilst cinema attendance is relatively stable (-2.3% CAGR in key markets), the industry faces significant long term challenges as the home cinema experience becomes an increasingly attractive alternative (4K TV, high speed internet and multiple video streaming options). The industry’s response is to invest in a better consumer experience (premium seating, availability of alcohol and improved food choice) alongside some uniquely cinematic differentiators such as 3D and IMAX viewing. In addition to this, cinemas are offering alternative content such as broadcasting live events. The studios are also experimenting with different film formats (e.g. 70 mm) better suited to cinematic viewing. The need for investment presents an opportunity for the large operators to expand by acquiring groups which are sub-scale. In our view, the markets which present attractive opportunities for acquisition-led growth include France, Germany and Italy.

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Key conclusions > More and more countries in the ranking… a positive sign even if the bottom line is 1%. > Historical trends confirms the move towards FTTH/B: the growth is there, even if not always sustained; 2014 seems to be a year of real start for FTTH/B! > End users are more and more aware about FTTH/B, but the switch to FTTH/B connection is not systematic yet: there is still a large room for communication by operators. > Governments and local authorities are entering the game > DAE’s main requirements are respected in all EU28 countries > Local authorities are more dynamic in Scandinavian countries and in France: they should impulse a new dynamic in countries where FTTH/B is lagging far behind other architectures > Highest take up rates in Northern and Eastern countries: still strong competition from other architectures elsewhere > But Spain and France are still leading countries in terms of new subscribers from one year to another > Nearly all players, even if less involved in FTTH/B than other architectures, consider that FTTH is the end game!

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IPTV Data

1. IPTV Data

2. Global forecasts – 35 million subscribers with EMEA the dominant region 2005 2006 2007 2008 2009 2010 EMEA North America AsiaPac 0 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 35,000,000 5,000,000 Source: Diffusion Group / Enders Analysis

3. France is likely to be the fastest growing market Source: Diffusion Group / Enders Analysis 1,50 5,30 2011f 4,40 2010f 3,60 2009f 2008f 2,80 2007f 2,00 2006 5,30 IPTV Subscribers France (million) – Leading players FT, Free, Neuf

4. Italy is likely to grow but still remain smaller than the French market Source: Diffusion Group / Enders Analysis 200,00 1.500,00 2010f 1.000,00 2009f 2008f 800,00 2007f 400,00 2006 5,30 IPTV Subscribers Italy(‘000s) – Leading players Fastweb, Telecom Italia

5. Spain has got off to a fast start with Telefonica signing up 383,000 customers in 2006 Source: Telefonica / Enders Analysis 5,30

6. Hong Kong is dominates IPTV forecasts for Asia Pac Source: PCCW/ Diffusion Group / Enders Analysis 800,00 4.440,00 2010f 3.053,00 2009f 2008f 2.200,00 2007f 1.540,00 2006 5,30 IPTV Subscribers Hong Kong (000s) – Leading player PCCW (Now.Tv)

IPTV Data

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