Review of Japan media, internet and mobile landscape in 2010 and 2011. Perspective on social networks, and emerging technologies and trends

1. Japan digital landscape and insights December2,2010 Neo@Ogilvy Japan

2. Agenda JapanMarket Social Media Mobile New Device& Technology

3. Japan Market

4. Transition of Internet Users 94.08 million users, 78.0% penetration rate (million people ) Datasource:Ministry of Internal Affairs and Communication 2010 4

5. Usage rate by Age/Gender Male 81.3%, Female 74.9% over age 6 (%) Datasource:Ministry of Internal Affairs and Communication 2010 5

6. Internet Usage Device Slight increase in Mobile & Game/TV connection (year-on-year) (Unit=million people ) PC 85.14 M(90.5%) PConly 12.92 M(13.7%) -0.3% (vs 2009) Mobile 80.10 M(85.1%) +2.5% (vs 2009) PC& Mobile 64.92 M(69.0%) 0.76 M (0.8%) 4.75 M (5.2%) 0.02 M (0.0%) Mobileonly 8.85 M(9.4%) Game or TV 5.67 M(6.2%) 0.13 M (0.1%) +1.7% (vs 2009) Datasource:Ministry of Internal Affairs and Communication 2010 6

13. SocialMedia

14. SpecialSneakers 14

15. Types of Social Media 15

16. Microblog 16

17. Microblog 17

20. How is Twitter used? Share Learn Tell 20

22. Twitter as Business Tool Many business leaders and media delivering information on daily basis BusinessLeader Media 1,373 29,582 680,768 47,146 7,469 1,827,353 4,462 10,862 3,301 90,047 51,398 7,437 221,312 2,472 3,890 4,144 +Competitor Data Source:Twitter(November 29, 2010)

23. What companies are tackling? PR Promotion Communication CRM

27. SNS 27

28. SNS in Japan Affiliation 19.93 million 20.74million Conflict Conflict 20.59 million people Membership as of June 2010 28

29. Strategy of 3 SNS companies Addressing the mechanism that strengthens real relationship between people on the web Strengthening virtual relationship with Social Game as the principal axis 29

30. Hot SNS Real name& Open culture Anonymity Career- move style Closed office environment

31. Twitter and Facebook Using both is standard in US Datasource:Twitter and Facebook (November 29, 2010)

32. Usage situation of companies in Japan Facebookis not penetrated in Japan Datasource:Twitter and Facebook (November 29, 2010)

36. Mobile

40. GALAXY S start exceeds iPhone 4. Reservations alone over 50,000 -Oct27,2010 Ｎ Expansion of Smartphone Devices Clash with Android as 15 new models from 3 companies in winter/spring KDDIISO3to be launched 250,000 tentative reservations made already – Nov26 １.69 million iPhone shipped in 2009, 72.2% of smartphone-Apr23,2010 460,000 Xperiashipped by end of Sept.9-Oct27,2010 40

43. 現場、本社がタイムリーに連携した顧客情報、サービス

44. ペットの遠隔健康管理

46. Delivery of timely customer information and service from headquarters to stores

48. Application 44

55. iAd 51

56. 52 iAd is an… Advertising platform within applications Enables delivery of interactive advertising or high-quality images when clicking ad in full screenwithin the application without moving to another site Supports targeting byLocation Information Ad is created with HTML5avoiding Flash

57. By end of 2010 $ 60 million Worth placement is expected Advertisers Walt Disney, NISSAN, Citigroup, Unilever, AT&T, Chanel, General Electric, Liberty Mutual Insurance, State Farm Mutual Automobile Insurance, GEICO, Campbell Soup, Sears Holdings, J. C. Penney, Target, Best Buy, DirecTV, Turner Broadcasting Systemetc… iAd in the US Market 53 Market size

58. Case Study-US

59. iOS vs Android 55

60. Installed OSShare Datasource:Seed Planning “ Smartphone / iPad (Tablet PC) Report 56

61. iOSdevices and Androiddevices Home Electronics Car etc…. TV Smart Phone Tablet PC Projection 57

62. New Technologies &Devices

63. Digital Books 59

65. Movement of digital books 2010 ”agora-books” (publisher specializing in digital books) established Mar The Electronic Book Publishers Association of Japan established Apr “Astand” (Digital book delivery site for Asahi Shimbun PC) opened May “iPad“ launched “Digital Library Publication”(digital publication purchase application for iPhone offered free of charge) Jun Kinokunia Books announced entry into digital book delivery market Jul “Kindle”announced 2 new product models Seven&I holdings announced entry into digital book business Aug NTTdocomo, Dainippon printing formed business partnership in digital book platform construction “SONY Reader“ new series released “Galaxy Tab”(Samsung)announced Sept “GALAPAGOS(Sharp)announced (to be launched in December)

67. With the appearance of iPad and exclusive terminal, demands on new platform is expected to growDigital Book Market Size (M USD / 1 USD = 100 JPY) PROJECTION Datasource:Impress R&D “Digital Book BusinessReport2010” 62

68. Digital Book Terminals (new platform) Tablet PC iPad Galaxy Tab LifeTouch GALAPAGOS FLEPia Digital book exclusive terminal SONY Reader Kindle 63

70. What were other readers’ comments?

71. Review

72. Twitter favorite phrase on TwitterOnline Book Club 4 other people highlighted this part of the book 64

73. Layer Reading Idea of digital book creating new reading experience and business opportunities Layer for sharing thoughts and impression with members Layer for comments by other writer Layer for discussion with friends about book purchase 65

75. AR 67

77. 69 Case Study

78. InsightforConstituencies

80. Business:NP, MG, Online / IT : MG, OnlineDatasource:JapanMediaConsumption Study5 71

82. IT site, IT magazines, Portal site/News site are influential when accessing informationAccessing info. Considering Decision-making ITpro,@ITinformation site Portal/News site IT magazines Vendor homepage Exhibition/Seminar Seminar hosted by Vender Person in charge of Vender Person in charge of Agent Business Magazine NP (national) Datasource:ES quantitative research2010 72

84. Tendency to access portal site every day（現、日経電子版） Datasource:JapanMediaConsumption Study5) 73

85. Current Situation of Smartphone 89％ aware of smartphones among which12％are already using them 51％are considering using them ※Total of all target (CxO, LOB, IT in LEE/MM) ※Research conducted in 2010.3 Datasource:JapanMediaConsumption Study5 74

86. Usage rate of Social Media 10% 7% 30% 2% ※Total of all target (CxO, LOB, IT in LEE/MM) ※Research conducted in 2010.3 1% Datasource:JapanMediaConsumption Study5 75

87. Thank you 76