Statista Digital Economy Compass 2017

1. Digital Economy Compass April 2017

2. 2 “At least 40% of all businesses will die in the next 10 years… if they don’t figure out how to change their entire company to accommodate new technologies.” John Chambers, Chairman of Cisco System

3. Welcome to the Digital Economy Compass 3 Less talking, more facts – our idea behind creating the Digital Economy Compass. It contains facts, trends and key players, covering the entire digital economy. We provide… › key essentials from our research, › actionable insights, › Statista’s exclusive forecasts. This very first edition will provide everything you need to know about the digital economy. Your Digital Market Outlook Team

4. Table of Contents 4 › Connectivity: Numbers behind the “always on” trend…………………………... › Social Media: Love it, hate it, but accept that you need it…………………... › Platform Economics: A story about White Sharks and Swordfish……… › Venture Capital: Feed for new Tech-Unicorns…………………………………...... › AI, AR and VR: The next big Technology Hype………………………………………. Statista’s Digital Market Outlook Global Trends › e-Commerce……………………... › eServices……………………………. › eTravel ………………………………. › Digital Media……………………... › FinTech…………………………………. › Digital Advertising…………….... › Smart Home……………………...... › Connected Car…………………….. 91 5 20 30 83 160 171 181 148 129 106 117 138

5. Connectivity

6. Source: internetlivestats.com 2,570,792 e-mails per second The global number of e-mails sent per second resulted in around 81 trillion e-mails sent during 2016.

7. The world is more connected than ever, a development which looks set to continue Source: Statista Digital Market Outlook Note: Figures account for total world population using the internet / a smartphone within the last 12 months 7 Share of world population connected to the internet from 2016 to 2021 +5.7% p.a. +3.7% p.a. 2021 50.5% 63.9% 2020 48.8% 61.8% 2019 46.9% 59.7% 2018 44.5% 57.5% 2017 41.6% 55.4% 2016 38.2% 53.2% Mobile penetration Internet penetration Connectivity

8. Many people still lack internet access, particularly in the most populous countries Source: Statista Digital Market Outlook Note: Only includes countries listed in the Digital Market Outlook 8 Internet penetration per country in 2016 (in % of total population) Internet penetration rate > 80% > 70% > 60% < 60% Connectivity Not included

9. Web consumption per user via Laptop or Desktop PC is highest in Brazil Source: Statista Digital Market Outlook Note: Data is based on internet users aged 16+; non-internet users are excluded from averages 9 Time spent online via Laptop/Desktop PC (hours per day) Spain Germany South Korea China Brazil Canada United Kingdom Italy France United States 2012 2016 5:36 4:43 4:27 4:22 4:16 3:57 3:55 3:36 3:29 3:16 5:28 5:06 4:23 4:30 4:07 4:08 4:03 3:38 4:39 3:45 Connectivity

10. In a global comparison, broadband speed is fastest in East Asia and Scandinavia Source: Akamai Technologies Note: Figure refers to Q3-2016; countries covered: broadband ranking – 147 1: Megabits per second 10 Average broadband speed in Top10 and selected countries (in Mbps1) South Korea 1 Hong Kong 2 Norway 3 23.6 18.2 Sweden 4 20.1 18.4 20.0 19.7 China 85 Switzerland 5 Singapore 6 Japan 7 Finland 8 Netherlands 9 Latvia 10 … United States 12 United Kingdom 20 Germany 26 France 49 18.0 17.6 17.3 16.9 5.7 16.3 14.9 13.7 9.7 Connectivity

11. 11 “Mobile is the future, and there is no such thing as communication overload.” Eric Schmidt, Executive Chairman of Alphabet, Inc.

12. Smartphone sales reached almost 1.5 billion in 2016, with Samsung being the biggest vendor Source: IDC, Gartner 1: Original Equipment Manufacturer 2: Shipment information not available for each year; if no information available, sales are included in “Other” Note: Estimated figures for Lenovo and Xiaomi in 2016; market shares may not sum up in 100% due to rounding 12 Global smartphone shipments (in million) and market shares per OEM1 4.0% 5.3% 2016 1,437 2014 1,302 2013 1,020 2012 725 2011 495 2010 305 9.5% 6.8% 14.6% 21.2% 3.1% 35.6% 2015 1,471 Samsung Apple Huawei Oppo Vivo Lenovo Xiaomi Others 2 2 2 2 2 Connectivity

13. Android has become the dominating mobile OS, while Apple’s iOS has maintained market share Source: Gartner OS = Operating System 1: based on worldwide unit sales Worldwide smartphone operating system market share1 84.8% 14.4% 2016 100% 2013 20152014 14.4% 3.9% 2012201120102009 iOS AndroidWindowsSymbianOthers BlackBerry 13 Connectivity

14. Cross-device, Android even overtook Windows as the dominating OS for desktop and mobile Source: StatCounter.com 14 Global operating system market share from Feb 2016 to Mar 2017 0 5 10 15 20 25 30 35 40 45 50 Mar-17Feb-17Jan-17Dec-16Nov-16Oct-16Sep-16Aug-16Jul-16Jun-16May-16Apr-16Mar-16Feb-16 OS XiOSAndroidWindows Market share (in %) Android 37.93% Windows 37.91% Connectivity

15. Advanced mobile devices and a growing number of apps increase time spent on mobile devices Source: Statista Digital Market Outlook Note: Data is based on internet users aged 16+; non-internet users are excluded from averages 15 Time spent online via mobile device per user (hours per day) Canada United Kingdom France Germany Brazil United States Spain Italy South Korea China 2012 2016 4:48 3:03 2:37 2:34 2:11 2:10 2:10 2:09 1:37 1:32 1:54 1:48 1:35 1:37 1:52 1:35 1:14 1:16 1:20 1:01 Connectivity

16. Being ‘always online’ leads to larger mobile data traffic per device Source: Ericsson Mobility Report 16 Estimated data traffic per smartphone (in gigabytes per month) 22.0 7.0 6.0 18.0 11.0 6.5 3.7 North America Latin America Middle East and Africa Asia Pacific Central and Eastern EuropeWestern Europe 1.9 1.4 1.4 1.0 1.0 2021 2015 Connectivity

17. The sevenfold increase in global mobile data traffic is mainly driven by online video streaming Source: Cisco System; figures include only cellular mobile traffic (Wi-Fi or small cell from dual-mode devices are excluded) Note: Other mobile devices include Tablets, mobile PCs, M2M (incl. wearables), non-smartphone mobile phones, e-readers and portable gaming consoles 17 Global mobile traffic forecast per segment (in petabytesper month) 560 11,266 16,792 7,225 2,939 11,415 3,780 1,194 7,241 2,154 4,375 2016 2017 2018 2019 2020 2021 843259 403 24,452 592 1,621 17,565 4,675 34,531 821 2,104 26,068 5,539 48,360 1,103 2,674 38,148 6,435 152 Web, data, and VoIP Video streaming Audio streaming File sharing Consumed via smartphone 85.2% 85.8% 81.3% 82.8% 83.8% 84.7% 1 Petabyte = 1 million Gigabyte Connectivity

18. Mobile connection speed varies a lot between countries, with disappointing speed in the U.S. Source: Akamai Technologies Figure refers to Q3-2016; countries covered in mobile connection ranking – 61 Note: Evaluation of mobile connection speed for each country is based on a minimum of 25,000 observed unique IPv4 addresses 1: Megabits per second 18 Average mobile speed in Top10 and selected countries (in Mbps1) United States 38 23.7 7.5 China 31 8.9 South Korea 18 11.2 Japan 16 11.6 France 13 12.4 … United Kingdom 1 Australia 10 12.8 Austria 9 13.0 Germany 8 13.1 Ireland 7 13.2 UAE 6 13.3 Spain 5 13.4 Finland 4 16.9 Norway 3 17.4 Belgium 2 19.3 Connectivity

19. Pokémon Go was the most popular mobile game for iPhone users across the globe In cooperation with 19 Most downloaded iPhone apps per category and country in 2016 Categories covered: Shopping, Music, News, Gaming, Social Networks U.S. PandoraAmazon CNN Pokémon Go Messenger China Kugou Music Taobao Toutiao WeChat King of Glory Germany SpotifyKleinan zeigen Spiegel Online Pokémon Go WhatsApp U.K. SpotifyeBay BBC News Pokémon Go WhatsApp France DeezerWish Le Monde Pokémon Go Messenger Connectivity

20. Social Media

21. “If you make customers unhappy in the physical world, they might each tell 6 friends. If you make customers unhappy on the Internet, they can each tell 6,000 friends.” Jeff Bezos, Founder and CEO of Amazon

22. In 2016, Social Media platforms connected 2.8bn people, more than 1/3 of the world population Source: wearesocial, InternetWorldStats, Statista Digital Market Outlook 1: MAU = Monthly active users 22 Selected countries in terms of Social Media MAU1 (in million) 16 23 25 31 33 36 42 42 48 56 64 122 191 214 India 2,789 Germany Australia France China Spain 787 Japan 1,059 Canada Rest of the world Russia United Kingdom Global United States Turkey South Korea Brazil Italy 62% of global Social Media users Social Media

23. Users in Brazil are connected to Social Media for more than 4 hours a day Source: Statista Digital Market Outlook Note: Data is based on internet users aged 16+; non users are excluded from averages 23 Avg. time users spend on Social Media platforms (hours per day) Germany France Spain China Australia Canada United Kingdom Italy United States Brazil 2012 2016 4:18 3:03 2:33 1:49 2:21 1:55 2:08 1:35 2:02 1:33 2:01 1:42 2:00 1:31 1:57 1:47 1:49 1:31 1:27 1:26 Social Media

24. > 50,000,000,000 More than 50 billion messages are sent through WhatsApp every day. Source: Facebook (February 2017)

25. Facebook has the biggest Social Media reach, followed by Chinese tech-company Tencent MAU1 of selected social networks and messaging services (in million) Source: We Are Social, Hootsuite, Techcrunch, 1: MAU = Monthly active users, as of January 2017; WhatsApp and Facebook Messenger as of March 2017 2: Estimation as Snapchat only reports daily active users 90 150 297 300 317 632 700 846 877 VK Pinterest Snapchat Weibo Instagram Twitter Qzone 1,200Messenger WeChat Facebook 1,871 1,200Whatsapp QQ Tencent Inc.Facebook Inc. Others 25 2 Social Media

26. Facebook and LinkedIn Social Media exits1 were the most expensive per user to investors Source: Company Information, Yahoo! Finance, Business Insider, Forbes Note: Figures for monthly active users refer to the time of exit 1: Acquisition or IPO 2: MAU = monthly active user 26 Social Media exits (acquisition or IPO) in comparison 55 24 4 100 163 106 65 400 200 100 0 110,000105,000100,00025,000 800 20,00010,0005,0000 15,000 1,000 600 Monthly active users (in m) Tumblr Exit (US$m ) Price per MAU2 (in US$) Social Media Instagram LinkedIn WhatsApp Twitter Snapchat Facebook

27. Q1-’12Q4-’11Q1-’11Q2-’10 Q4-’10Q3-’10 Q2-11 Q3-’11 1.14 1.38 1.26 0.90 1.26 1.24 1.21 0.94 0.18 0.50 Q4-’15 0.84 Q3-’16 0.32 Q2-’16 Q4-’16Q2-’15 Q1-’16 0.06 0.31 0.05 Q1-’15 1.05 Q3-’15 Snapchat pre-IPO revenue per user performed well compared to its biggest competitor Sources: Snap Inc., Facebook Inc. 27 Global avg. revenue per user in the eight quarters before IPO (in US$) Snapchat Facebook Social Media

28. Post-IPO development is nothing to worry about for Snapchat Source: Yahoo! Finance Note: Figures as per 4-19-2017; all stock prices are closing prices; dividends are not considered 28 Stock prices of Snap, Facebook and Twitter in the first 30 days after IPO 0 30 US$44.9 US$38.2 US$19.5 US$25.9 US$39.1 US$20.2 US$31.1 US$57.5 US$24.5 Snap Inc. Twitter Inc.Facebook Inc.  -17.5%  -18.7%  +28.0% Low-point IPO 1st 30 days change3/2/2017IPO: 5/18/2012 11/7/2013 Days after IPO Social Media IPO-to- date  -15.8% - 67.6%  +272.1% 111213

29. If you are not Facebook, it remains challenging to transform Social Media into a profitable business Source: Company Information, as of Mar 2017 1: Statista estimated financial results for Q4-2016 29 FY2016 results of listed U.S. Social Media platforms (in US$ million ) 404 -515 -457 -162 Snapchat Twitter 2,530 Linkedin 3,868 Facebook 10,217 27,638 Net profit / loss Revenues 1 Social Media

30. Platform Economics

31. “A platform is a plug-and-play business model that allows multiple participants (producers and consumers) to connect to it, interact with each other and create and exchange value.” Twitter

32. The success of a digital platform is dependent on its external ecosystem Source: Harvard Business Review 32 Factors determining successful platforms Connection Gravity Flow Simplicity for partners to plug in, share and transact Capability to attract producers and consumers Promotion of co-creation and exchange of value Platform Economics

33. Digital platforms with varying business models can be found in multiple industries Source: Statista Research 33 Platform examples and their business models RepositoryDigital Media Infrastructure Search engines Application stores Social Media Ride sharing Market placesClassifieds Advertising Transactions Subscription Freemium Pay-as-you-go Digital Platforms store Platform Economics Didi Chuxing

34. Digital White Sharks - At the top of the food chain - › (Very few) digital economy leaders › Wide, diverse product portfolio › Gigantic assets Digital Swordfish - Big, fast, rarely get eaten - › (Few) big industry shaping players › Deep, vertical specific products › Already near peak growth Digital Piranhas - Small but aggressive for prey - › (Many) product specific players › Huge, product centric competition › Peak growth not yet reached The platform landscape consists of White Sharks, Swordfish, and Piranhas Source: Statista Digital Market Outlook 34 Platform economics in nutshell Platform Economics

35. Huge Chinese rivals are catching up on the big four U.S. platforms Source: Yahoo! Finance as per 04-12-2017 35 Top 15 publicly listed platforms by market cap (in US$ billion) 10 14 24 37 45 46 51 60 62 270 276 404 431 574 743 Rank Company Country Market Cap 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Apple Google Amazon Facebook Alibaba Tencent Netflix Baidu Paypal JD.com Yahoo! Ebay Snap Rakuten Twitter ∑ US$3,047bn Platform Economics

36. VC-backed platforms are vertically focused and 1/3 of the Top15 is located in China Source: CB Insights as per 04-12-2017 36 Top 15 privately held, VC-backed platforms by market cap (in US$ billion) 7 7 9 9 10 10 11 11 17 18 19 29 34 46 68 Rank Company Country Market Cap 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Uber Xiaomi Didi Chuxing Airbnb Lu.com China Internet Plus WeWork Pinterest Toutiao Flipkart Dropbox Stripe Spotify Snapdeal Lyft ∑ US$304bn China Internet Plus Platform Economics Category Ride Sharing Consumer Electr. Ride Sharing Online Travel E-Commerce Financing/Lending Collaboration Social Media Digital Media E-Commerce Collaboration Online Payment Digital Media E-Commerce Ride Sharing

37. Google Amazon Facebook Apple

38. The biggest White Sharks in the digital economy: Google, Amazon, Facebook, and Apple Source: Company Information, Yahoo Finance; Note: All figures refer to end of fiscal year 2016, except market cap which is as of 03-10-2017; figures related to Google correspond to Alphabet Inc. conglomerate 1: Unaudited as per released financial results 2: Full-time and part-time employees 38 Google, Amazon, Facebook and Apple key figures Founded: 04-1976 HQ: Cupertino, California CEO: Tim Cook (since 08-2011) Revenues: US$215.64 billion Net income: US$45.69 billion Employees: 116,000 Market cap: US$727.4 billion Founded: 09-1994 HQ: Mountain View, California CEO: Sundar Pichai (since 10-2015) Revenues1: US$90.23 billion Net income1: US$19.48 billion Employees: 69,953 Market cap: US$558.1 billion Founded: 05-1994 HQ: Seattle, Washington CEO: Jeff Bezos (since 05-1996) Revenues1: US$135.99 billion Net income1: US$2.37 billion Employees2: 341,400 Market cap: US$407.0 billion Founded: 02-2004 HQ: Menlo Park, California CEO: Mark Zuckerberg (since 2004) Revenues1: US$27.64 billion Net income1: US$10.22 billion Employees: 17,048 Market cap: US$399.5 billion Platform Economics

39. Revenues of the biggest four U.S. players show consistent growth Source: Company Information Note: FY2016 figures for Google, Amazon, Facebook are unaudited as per released financial results 39 Google, Amazon, Facebook and Apple global revenues (in US$ billion) 50.0 Apple 214.2 231.3 183.2 170.9 156.0 Facebook 27.6 17.9 12.57.95.1 Amazon 136.0 107.0 89.0 74.5 61.1 Google 89.7 73.6 65.8 59.7 20162015201420132012 CAGR +15.8% CAGR +22.2% CAGR +52.7% CAGR +8.3% Platform Economics

40. Apple has the highest net income, while Facebook has just started to make big money Source: Company Information Note: The size of circles corresponds to net income; FY2016 figures for Google, Amazon and Facebook are unaudited financial results 40 Google, Amazon, Facebook and Apple global net income (in US$ billion) 20152011 20132012 20162014 0.05 12.7310.62 14.14 -0.04 2.94 16.35 2.370.27 -0.24 39.51 45.6941.73 37.04 10.22 0.60 1.50 19.48 3.69 53.39 Platform Economics

41. Relationships with their users are key to the biggest digital platforms’ successes Source: Statista Research 41 User touchpoints of Google, Amazon, Facebook and Apple IT & Infrastructure Aquila Apple SIM Artificial Intelligence Google Assistant Jarvis Siri Hardware Devices Communication & Messaging Digital Media & Entertainment Connected Car & e-Mobility -Integration (Transportation) CarPlay E-Commerce & Retail Facebook ‘Buy-Button’ FinTech & Payment -Integration (Friend-to-Friend Payment) Navigation & Location services Amazon Maps API, MAPS.ME integration Advertising Facebook Business, Instagram Business Apple Search Ads Google+ Allo Pixel Chromecast Home Google Maps AdExchange Alexa integration Whatsapp facebook Messenger etc. etc. iBeacon store Apple Maps facebook.com/gaming ‘Purchase on Google’

42. Source: internetlivestats.com 59,141 Every second Google receives 59,141 search requests. On a single day, this number totals over 5.1 billion.

43. Google’s extensive product portfolio covers nearly all aspects of the digital experience Source: Google 43 Google product portfolio Data Analysis VR/AR Office Android System Translate Android Phones Android Auto Entertainment Google Play Music Youtube Chrome- cast Google Play Movies & TV Google Play Google Play Apps Play Games Play Newsstand YouTube Kids Social Gmail Google Allo Google Duo Google+Messenger Hangouts Inbox by Gmail Voice Docs Sheets Drive Slides Android for Work Forms Analytics Education Google Classroom Education Scholar Internet Browser Chrome Chromebook Chrome for Work Chrome Web Store Drawings Google Expeditions Blogger Google Cast Google Cloud Print Gboard TangoTilt Brush Sites Search Engine Search Google Search for Work Search Console Google Sync Navigation Maps Google Maps Business View Google Maps for Work Earth Waze Google Domains Google Surveys Designing Google Fonts Nik Collection Web Designer Android OS Android Pay Google Alerts News YouTube Gaming G Suite Google Cloud Platform Google Trends Android One Google Groups Google Input Tools Android Tablet Life Google Flights Google One Today Project Fi Google Fit Zagat Google Camera E-Commerce Google Express Trusted Stores Google Store Business & Marketing AdWords AdSense My Busines Google Shopping Campaigns Google+ Brands Local Inventory Ads Merchant Center DoubleClick by Google FinanceTag Manager AdMob Google Calendar Hardware Pixel Home Google Wifi Smartbox OnHub Cardboard Daydream View Android Wear Google Goggles Nexus Platform Economics

44. “Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1.” Jeff Bezos, Founder and CEO of Amazon

45. The key to Amazon’s success is Jeff Bezos’ “Day 1” philosophy Source: Amazon, Inc. 45 Amazon revenue development from foundation to 2016 (in US$ million) 61014816 135,987 2015 107,006 2014 88,988 2013 74,452 2012 61,093 2011 48,077 2010 34,204 2009 24,509 2008 19,166 2007 14,835 2006 10,711 2005 8,490 2004 6,921 2003 5,264 2002 3,933 2001 20162000 2,762 1999 1,640 3,122 199719961995 1 1998 Mission statement: ‘Earth’s biggest book store’ Vision statement: ‘Our vision is to be earth's most customer centric company […]’ Platform Economics

46. Source: Consumer Intelligence Research Partners, Statista Digital Market Outlook Note: 249 million e-Commerce users in the U.S. in 2016 (Statista estimates) About 32% of U.S. e-Commerce customers subscribe to Amazon Prime Amazon Prime subscribers in the United States (in million users) 63 54 44 40 28 25 80 June 2016December 2015June 2015December 2014June 2014December 2013 Mar 2017 46 Platform Economics

47. Amazon is far more than just an e-Commerce giant; it also controls the public cloud landscape Source: Synergy Research Group 1: includes platform as a service (PaaS) and infrastructure as a service (IaaS) revenues Global public cloud infrastructure1 market share (% of revenue) in Q4-’16 23% 40% Next 10 providers 18% 18% Long tail of small providers Public cloud infrastructure revenues are estimated at over US$7 billion per quarter 47 Platform Economics

48. 48 300,000,000 gigabytes Facebook stores more than 300 million gigabytes of user data. This data corresponds to 126 digital books about each active user.

49. Facebook has 1,860m MAU1 with 85.2% of them located outside of North America Source: Facebook Inc. Note: all figures as of Q4 ’16 1: MAU = monthly active user 49 Facebook key facts 5m Instagram business profiles 84% mobile share of advertising revenues 101 available languages 85.2% daily active users outside North America Feb 2009 invention of the ‘Like’ button 300,000 translators 1,860m monthly active users 65m business pages 4m businesses directly advertising Platform Economics

50. Facebook’s active user base has been consistently growing Source: Facebook Inc. 50 Global number of Facebook’s monthly active users (in million users) 197 955 901 845 800 739 680 608 550 482 431 360 305 242 1,189 1,228 1,276 1,317 1,350 1,393 1,441 1,490 1,545 1,591 1,654 1,712 1,788 1,860 1,155 1,110 1,056 1,007 2009 2010 2011 2012 2013 2014 2015 2016 Platform Economics

51. Imagine if Facebook’s worldwide average revenue per user equaled that of North America Facebook‘s average revenue per user, by user geography in US$ 5.91 19.40 2.35 7.29 Europe 13.58 62.23 1.84 4.66 5.32 15.98 Asia-PacificU.S. and Canada Rest of the World Worldwide 2012 2016 358% 228% 200%153%210% 51 Source: Facebook Inc. Platform Economics

52. 52 “There is no chance that the iPhone is going to get any significant market share.” Steve Ballmer in 2007, Former CEO of Microsoft

53. With nearly 70% revenue share in Q1-’17, the iPhone is the biggest success in Apple’s history Source: Company Information 1: Fiscal quarters; Apple’s fiscal year ends in September iPhone revenue as percentage of Apple’s total revenue since 20071 0 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 69.4% 69.4% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 53 Platform Economics 2017

54. Apple is the biggest vendor in a shrinking tablet market Source: IDC 54 Global tablet shipments in 2016 in millions 2016 174.8 24.4% 15.2% 6.9% 6.4% 5.5% 41.6% 2015 207.2 2014 230.1 2013 219.9 2012 143.4 2011 71.4 2010 17.9 Apple Samsung Amazon Lenovo Huawei Others Platform Economics

55. The number of active Apps in Apple’s App Store is predicted to reach over 5 million by 2020 Source: SensorTower 55 Projected number of active apps in Apple’s App Store worldwide by 2020 0 1 2 3 4 5 6 2020201920182017201620152014201320122011201020092008 Forecast million Platform Economics

56. Stock market prices reflect the tech-giants’ development Source: Yahoo! Finance Baseline for stock prices are GE, T, WMT, XOM, GOOGL, AMZN, AAPL, FB 1: Figures as per 03-10-2017; all stock prices are closing prices; dividends are not considered 56 U.S. tech-giants vs. Top U.S. non-tech giants stock market development 0 50 100 150 200 250 300 350 400 450 500 550 600 650 700 750 800 850 900 01/1801/1701/1601/1501/1401/1301/12 Stock price in USD +43.0% -0.9% +61.4% +14.8% 0 50 100 150 200 250 300 350 400 450 500 550 600 650 700 750 800 850 900 01/12 01/13 01/14 01/15 01/16 01/17 01/18 Stock price in USD +342% +188% +136% +339% Combined market cap1: US$1,070 billion Combined market cap1: US$2,119 billion Platform Economics

57. Only investing $1,000 in bitcoins would have been more profitable than in digital platforms Source: Yahoo! Finance; Coindesk.com Baseline for stock prices are GE, T, WMT, XOM, GOOGL, AMZN, AAPL, FB (NASDAQ) Note: Dividends are not considered 57 Pay-off in Mar 2017 for a US$1,000 investment in Jan 2012 991 778 207,071 4,419 4,387 2,364 1,614 1,429 2,882 1,148 Gold 2,805NASDAQ Platform Economics

58. As many western platforms struggle in China, Chinese competitors have stepped up Source: Statcounter.com, iResearch China, CNN, Bloomberg, Techcrunch, ChinaSalesCo.com, Fortune.com, Marketwatch.com 58 Major digital platforms and their appearance in the Chinese market 1.45% search engine market share 0.8% e-Commerce market share BANNED Fail and retreat a decade ago 0.0001% share of China e-Commerce transactions Acquired by Didi Chuxing Licensing partnership instead of own business 0.49% search engine market share Platform Economics

59. Baidu Alibaba Tencent Huawei

60. The untapped potential of 676m awakening digital customers makes China unique Source: Statista Digital Market Outlook 60 Online vs. Offline population in China and the U.S. in 2016 Online population Offline population (growth potential) 10,000,000 people Platform Economics 264 million 59 million 676 million 702 million

61. Baidu, Alibaba, Tencent, and Huawei (BATHu) are China’s overlooked tech-giants Source: Company Information; Yahoo! Finance Note: Alibaba Group FY2016 ended on 03-31-2016; revenues converted from RMB to US$ as per annual reports respectively press releases 1: Unaudited as per FY2016 released financial results 61 BATHu key figures Founded: 1987 HQ: Shenzhen CEO: Ren Zhengfei (since 1988) Revenues: US$75.10 billion Net income: US$5.34 million Employees: 180,000 Market cap: not listed Founded: 04-1999 HQ: Hangzhou CEO: Daniel Zhang (since 05-2015) Revenues: US$15.69 billion Net income: US$11.06 billion Employees: 36,446 Market Cap: US$258.47 billion Founded: 01-2000 HQ: Peking CEO: Robin Lu (since 01-2004) Revenues1: US$10.20 billion Net income1: US$1.68 billion Employees: 45,887 Market cap: US$60.04 billion Founded: 11-1998 HQ: Shenzhen CEO: Ma Huateng (since 11-1998) Revenues1: US$21.97 billion Net income1: US$5.99 billion Employees: 38,775 Market cap: US$257.57 billion Platform Economics

62. BATHu’s compound annual growth rates from 2012 to 2016 are consistently above 20% Source: Company Information Note: Tencent and Baidu monetary figures for FY2016 yet unaudited Revenues converted from RMB to US$ as per annual reports respectively press releases 62 BATHu global revenues (in US$ billion) HuaweiAlibaba TencentBaidu CAGR +20.7% Huawei 75.1 60.8 46.5 39.5 35.4 Tencent 22.0 15.9 12.7 10.0 7.0 Alibaba 15.7 12.3 8.5 5.7 3.2 Baidu 10.210.2 7.9 5.3 3.6 20162015201420132012 CAGR +29.9% CAGR +48.6% CAGR +32.9% Platform Economics

63. Alibaba’s FY16 net income was almost fifteen times higher than 5 years ago Source: Company Information Note: The size of circles corresponds to net income; Tencent and Baidu monetary figures for FY2016 not yet unaudited Net income converted from RMB to US$ as per annual reports respective press releases 63 BATHu global net income in US$ billion 201620152012 201420132011 1.97 11.06 4.503.47 5.992.05 3.77 3.92 2.47 1.71 0.75 2.57 1.685.011.67 1.43 3.85 5.69 4.49 5.34 Platform Economics

64. Accompanied by their financial prosperity, Chinese platforms invest in U.S. startups Source: Crunchbase 64 VC-investments of Baidu, Alibaba and Tencent in the U.S. 2014 2015 2016 IndoorAtlas Cloudflare IndoorAtlas Taboola GWC Dynamic Yield Velodyne LiDAR ZestFinance Peel Kabam Lyft Tango 1stdibs Lyft Mei.com Snap Inc. Quixey Barefoot Networks Magic Leap PlaceIQ Playdots Kamcord Heirloom Technology Tile Heirloom, Inc. Woqu.com AltspaceVR Moon Express, Inc. Vurb Women.com Scaled Inference TapZen Whisper Weebly Circle Medical Watsi Artillery FlightCar Clinicloud Nav Nixie Labs HomeHero Tute Genomics Tissue Analytics Lyft Pocket Gems CloudMedx Inc Scanadu Skymind VC Mobile Entertainment Inc. Cyanogen Satellogic Robot Entertainment Discord SketchMe Stae Clear Labs Barefoots Networks Petuum Skymind Nav Payoff Meta Tile Paradox Interactive Planetary Resources Kamcord Diffbot Discord Platform Economics

65. Source: CNBC Baidu was the first Chinese company to be listed in the NASDAQ 100 index. 1st

66. Although primarily operating in China, Baidu dips its toes into new markets Source: Chinainternetwatch.com, StatCounter.com, Alexa.com 1: The rank is calculated using a combination of avg. daily visitors and pageviews over the past three months 66 Baidu key facts Popularity Chinese Rank1: 1 Global Rank1: 4 Stock Market 1st Chinese company listed in NASDAQ 100 Performance 2nd largest search engine in the world Request Origin 1) China: 91.5% 2) Japan: 3.2% 3) South Korea: 1.5% Subsidiaries Tokyo, Sunnyvale (CA), Jakarta, Bangkok, Cairo, Sao Paulo Top Tech Keywords 1) VR 2) Gravitational wave 3) AlphaGo Platform Economics

67. In China, Baidu has strong brand awareness, with a large domestic market share of over 75% Source: StatCounter.com 67 Search engine market share in China (in percentage) 0 10 20 30 40 50 60 70 80 90 100 Dec ’13 69.8% 79.1% Dec ’15 74.8% 54.4% Dec ’14 Apr ’17 75.1% Dec ’16 Dec ’12 70.3% 3.7% 7.8% 10.2% 1.4% 1.8% Others Market share in % Platform Economics

68. AI will further improve search engines; Baidu’s face recognition software is a good example Source: Massachusetts Institute of Technology Note: Figures as of 2015, based on the Labeled Faces in the Wild (LFW) dataset 68 Face recognition software comparison as %-error in face recognition Platform Economics Human-Level: 0.80% Baidu 0.23% Google 0.37% University of Hong Kong 0.53% Facebook 1.65% Microsoft 3.67%

69. Source: Alibaba Group 175,000 Chinese e-Commerce giant Alibaba processed 175,000 transactions per second on the peak time of “Singles’ Day” in 2016. At the end of the day the number of orders processed totaled 657 million.

70. The Alibaba Group has evolved to become a platform with multiple user touchpoints Source: Alibaba Group 70 Alibaba Group Overview E-Commerce OthersDigital Media Platform Economics Core Business

71. Singles' Day is the largest shopping day in the world, and Alibaba benefits most of it Sources: Fundivo, Adobe, Alibaba Group, Tech in Asia, Thomson Reuters, MarketWatch 71 U.S. Cyber Monday spending and Alibaba Single’s Day GMV (in US$bn) 2012 9.30 2011 14.30 2010 3.45 0.14 20152013 2016 17.79 3.04 5.80 2014 0.82 1.30 1.98 2.982.652.29 1.30 Cyber Monday Single’s Day Platform Economics

72. Alibaba’s fast growth demonstrates how software is much more scalable than warehousing Source: Company Information Note: all figures correspond to calendar years and quarters; financial years do not equal calendar years 72 Walmart and Alibaba quarterly key-figure comparison (in US$ billion) 20 140 100 0 40 120 60 80 Q4Q3 Q2Q2Q2 Q3Q4 Q3 Q1Q1 Q4 Q1 Q2Q1 Q3Q2 Q4 2012 2013 2014 2015 2016 Net Sales / GMV Global net sales Chinese gross merchandise value Platform Economics

73. “Will Tencent join the likes of Amazon, Google, Facebook and Twitter? […] They already are in that league. The rest of the world just doesn’t know it.” Aditya Rathnam, Co-Founder of Kamcord

74. China‘s largest tech company can be compared with its U.S. Social Media counterpart Key financial and operating metrics of Tencent and Facebook in 2016 Revenue 5.99 10.22 21.97 Net Profit 27.64 TencentFacebook Source: Company Information, We Are Social, Hootsuite Key Financials (in US$ billion) Monthly Active Users (in million) 632 846 877 700 1,871 Qzone Whatsapp Instagram Facebook QQ 1,200 WeChat 74 Platform Economics

75. WeChat has a diverse business model with multiple revenue sources Source: Company Information, OLMA Capital Management 75 Direct comparison of WeChat and WhatsApp WeChat WhatsApp Geographical focus China US Europe Monthly active users 846 million 1,200 million Price Free of Charge Free of Charge Monetization Transaction Fees & Mobile Advertising › Social & Communication › Leisure & Commerce › Media & Gaming VideoPhoto- graphy Voice Message Location Texting Voice Chat Photography Video Moment Feeds Group Chats Video Chat Group Chats Video Chat Translation e-Commerce Event Organization Mobile Banking Location Official Accounts Voice Message Meet Strangers (Shake) Taxi Reservation Online Ticketing Mobile Gaming Desktop Gaming Texting QR Code Reader Newsfeeds Price Checks Music Platform Economics

76. 76 5G Huawei aims at playing a central role in 5G mobile technology, the next big evolutionary step in mobile connectivity. Along with large R&D expenditures, Huawei also initiated a number of collaborative research initiatives – widely known as Wireless X labs.

77. Huawei overtook Apple and became one of the most R&D-intensive tech companies Source: Company Information Note: Dell figures refer to FY2017 as this year ended on 01-31-2017 77 R&D spending of major global tech-companies in 2016 (in US$ billion) Google Samsung Intel 13.95 Microsoft Facebook 12.84 Amazon Apple 12.70 Huawei Oracle IBM Sony Dell 12.59 12.00 11.00 10.05 5.92 5.79 5.75 4.32 2.64 Platform Economics

78. 1,287% 909% 2009 1,027% 747% 2008 848% 653% 2007 580% 429% 2006 2,977% 336% 2005 281% 242% 2004 180% 144% 2003 127% 108% 2002 100% 100% 2,717% 2016 1,661% 4,029% 2011 1,522% 2012 2,859% 2013 2,186% 400% 3,192% 3,732% 2014 2015 3,529% 1,854% 1,885% 2010 Huawei and Apple show similar revenue growth Source: Company Information, Statista Digital Market Outlook Revenues converted from RMB to US$ as per annual reports respectively press releases; years 2007-2011 are calculated with the avg. exchange rate of the specific year with exchange rates from www.oanda.com 78 Annual revenue comparison of Huawei and Apple from ’02-’16 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 5.7 6.2 8.3 13.9 19.3 24.6 37.5 42.9 52.2 108.2 156.0 170.9 183.2 231.3 214.2 2.1 2.7 3.8 6.0 8.5 12.3 18.0 21.9 27.4 32.4 35.4 39.5 46.5 60.8 75.1 Annual revenue (in US$ billion) Indexed revenue development (year 2002 = 100%) Platform Economics

79. Baidu, Alibaba, Tencent and Huawei vs. Google, Amazon, Facebook and Apple – Who is taking the lead? 79

80. BATHu may catch up in the digital economy, but the big U.S. players remain the top innovators Source: Company Information; YCharts.com Note: Revenues and R&D expenditures converted from RMB to US$ from annual reports respectively press releases 80 Research & Development expenditures (in percent of total revenues) 15% 15%14% 13% 14% 8% 9% 10% 8% 10% 2%2% 2%2%2% 14% 14% 14% 13% 3%3% 3%2% 21% 21% 21% 27% 9%9% 10% 9% 10% 16% 17% 15% 14% 5% 10% 20152014 201620132012 12% 18% Total Research & Development expenditures: US$141.4bn Total Research & Development expenditures: US$48.6bn Platform Economics

81. Comparatively, U.S. tech-giants remain ahead of their Chinese competitors Source: Company Information, IDC, WeAreSocial, comScore Note: Monetary figures converted from RMB to US$ sourced from annual reports respectively press releases 1: CAGR = Compound annual growth rate 2: Statista estimates 3: MAU = Monthly active users; only take into account the biggest single Social Media Platforms Facebook and QQ 81 Key-figure comparison: GAFA vs. BATHu Revenues US$bn 89.73 10.20 CAGR1 ’12-’16 % 15.77 29.92 Profit margin % 21.71 16.44 R&D expend. US$bn 13.95 1.47 Domestic market share % 64.0 75.1 Revenues US$bn 135.99 15.69 CAGR1 ’12-’16 % 22.15 48.63 Profit margin % 1.74 70.5 R&D expend. US$bn 12.59 0.34 GMV US$bn 251.02 484.6 Revenues US$bn 27.64 21.97 CAGR1 ’12-’16 % 52.66 32.88 Profit margin % 36.97 27.3 R&D expend. US$bn 5.92 1.71 MAU3 m 1,871 877 Revenues US$bn 214.23 75.10 CAGR1 ’12-’16 % 8.26 20.73 Profit margin % 21.33 7.1 R&D expend. US$bn 10.05 11.00 Smartphone shipments m 215.4 139.3 vs. vs. vs. vs. Platform Economics

82. The Top 10 digital CEOs manage revenues of $846bn and own a combined fortune of $312bn Source: Company Information, forbes.com, celebritynetworth.com, therichest.com Note: Jack Ma is founder of the Alibaba Group, in 05-2015 Daniel Zhang became CEO Managed revenues referring to FY2016; Private fortune as of 04-10-2017 82 Top 10 business people in the digital economy Elon Musk 14.8 6.4 Jack Ma 29.5 15.7 Mark Zuckerberg 58.9 27.7 Larry Ellison 54.4 37.1 Michael Dell 20.5 58.2 Sadya Nadella 0.1 85.3 Larry Page 40.5 90.2 Jeff Bezos 76.8 136.0 Lee Kun-Hee 16.6 174.1 Tim Cook 0.4 215.6 Google Search Results (in million) Private fortune (in US$bn)Managed revenues (in US$bn) 79.3 28.3 18.1 67.2 29.8 0.8 0.5 23.9 6.0 1.3 Platform Economics

83. Venture Capital

84. 7,300,000,000 US$ In 2016 Didi Chuxing, the Chinese ride sharing company and major competitor of Uber, collected fresh capital funding totaling US$7.3 billion in order to strengthen its position in the Southeast Asian market Source: PitchBook

85. More deals and greater capital invested, bar 2016, complement growing average deal size Source: KPMG Enterprise, PitchBook 85 Global venture financing from 2010-2016 (in US$ billion) 21 39 39 9 10 10 11 15 18 16 32 46 43 47 72 82 72 68 2016 127 0 2015 141 2 2014 108 0 2013 65 1 2012 59 1 5 2011 64 0 2010 45 0 4 ROW Asia Europe Americas 8,459 10,842 18,157 17,992 13,66513,006 15,800 Capital invested Deal count Venture Capital

86. “Software is eating the world” – at least in the case of VC financing Source: KPMG Enterprise, PitchBook 86 Software sector share in venture financing in a regional comparison Americas Europe Asia Pacific 18% 21% 54% 22% 47% 2012 25% 13% 2010 2013 17% 21% 42% 33% 39% 22% 2014 32% 40% 36% 31% 2011 33% 2015 2016 33% 31% 24% Venture Capital

87. 10101010 3 8 5 2 Q1/2016 Q2/2016 Q4/2016Q3/2016 New Unicorns Exits > US$1 billion The stereotype Unicorn1 in 2016: digital and most likely to be Chinese or American Source: CB Insights 1: Unicorn = Startup company with a company valuation of more than US$ 1.0 billion 2: Company valuation as per 03-15-2017 87 New VC-backed Tech Unicorns and Exits in 2016 Skyscanner became Unicorn and exited in 2016 40 out of 41 new Unicorns were highly Tech-related 31 out of 40 Tech Unicorns were Chinese or American US$66.4 billion valuation2 of the 2016 Tech Unicorns US$34.4 billion value of the 18 Tech Unicorn Exits Venture Capital

88. U.S. and Chinese players take the top spots in terms of global VC financing and funding Source: PitchBook 88 Top 5 VC Financings and Funds in 2016 (in US$ billion) Top 5 VC Financings Top 5 VC Funds Snap Inc. 1.8 Meituan Dianping 3.3 Ant Financial 4.5 Uber 5.6 Didi Chuxing 7.3 Norwest Venture Partners XII 1.2 Founders Fund VI 1.3 Andreessen Horowitz 1.5 TCV IX 2.5 Baidu Capital Fund 3.0 Venture Capital

89. VC deals are primarily closed with male founders, particularly in the tech landscape Source: PitchBook 89 Global VC deals for companies with at least one female founder 9.4% 20162014 20152010 11.4% 14.2% 2011 20132012 15.1% 16.0% 16.5% 16.8% Energy Commercial Services Consumer Goods & Recreation Pharmaceuticals & Biotechnology Media Healthcare Devices & Supplies Software 28.2% 14.5% 7.5% 17.6% Healthcare Services & Systems 15.5% 11.8% 16.3% IT Hardware 12.6% 7.3% Percentage of deals Top industries Venture Capital

90. The U.S. and China are home to the greatest number of Unicorns, with Europe lagging behind Source: CB Insights Unicorn = Startup company with a company valuation of more than US$ 1.0 billion 1: countries with one ‘unicorn’: Argentina, Colombia, Czech Republic, Indonesia, Japan, Luxembourg, Netherlands, Nigeria, South Africa, United Arab Emirates 90 Private companies valued at one US$ billion or more as of 03-27-2017 1 2 2 2 2 2 3 4 7 9 45 99 Germany South Korea France Israel Singapore Sweden Switzerland 10 other countries China United States United Kingdom India 1 Venture Capital

91. AI, AR & VR

92. Source: MIT Baidu has developed a facial recognition software that recognizes human faces with a 99.77% accuracy. This surpasses average human-level facial recognition and many Silicon Valley competitors. 99.77%

93. There is a lot of activity in the Artificial Intelligence and Data Mining startup scene Source: CB Insights 93 VC-backed companies with certain words in their company description 2010 2011 2012 2013 2014 2015 2016 0.00% 0.07% 0.00% 2.18% 0.25% 0.42% 0.32% 0.61% 0.11% 1.96% 0.13% 0.31% 0.12% 0.74% 1.49% 0.33% 1.53%1.55% 0.94% 0.61% 0.34% Deep LearningArtificial Intelligence Machine Learning AI, AR & VR

94. VC-backed companies with the terms Machine Learning, VR & AI drastically increased since ‘10 Source: CB Insights 94 Change of VC-backed companies with given terms in their description Rank Word % in 2010 % in 2016 Change Rank Word % in 2010 % in 2016 Change 1 Virtual Reality 0.0% 1.0% - 21 Human 1.7% 3.5% 106% 2 Machine Learning 0.3% 2.0% 507% 22 Connected 1.0% 2.0% 102% 3 Natural Language 0.2% 1.0% 507% 23 Genetic 0.8% 1.5% 102% 4 Ingredients 0.3% 1.2% 385% 24 Videos 0.6% 1.1% 91% 5 Cyber 0.3% 1.5% 355% 25 Risk 2.4% 4.2% 78% 6 Artificial Intelligence 0.4% 1.8% 337% 26 Intelligent 1.7% 3.0% 76% 7 Reality 0.3% 1.4% 325% 27 Algorithms 0.8% 1.3% 75% 8 Automates 0.3% 1.0% 304% 28 Treatments 0.8% 1.3% 75% 9 Sensors 0.3% 1.3% 294% 29 Audio 0.6% 1.0% 73% 10 Feedback 0.4% 1.3% 215% 30 Culture 0.6% 1.0% 73% 11 Seconds 0.3% 1.0% 203% 31 Women 0.6% 1.0% 73% 12 Minutes 0.4% 1.2% 191% 32 Body 0.8% 1.4% 70% 13 Oncology 0.4% 1.2% 191% 33 Healthy 0.8% 1.4% 70% 14 Therapy 0.7% 1.9% 188% 34 Language 0.8% 1.4% 70% 15 Modern 0.5% 1.4% 183% 35 Stream 2.4% 4.1% 67% 16 Tumor 0.4% 1.1% 167% 36 Threat 0.4% 1.5% 65% 17 Stealth 1.3% 3.3% 143% 37 Hand 2.1% 3.5% 65% 18 Workflow 0.7% 1.6% 143% 38 Labs 1.7% 2.8% 64% 19 Insurance 0.8% 1.9% 130% 39 Bank 0.8% 1.3% 58% 20 Software Platform 0.5% 1.1% 122% 40 Measure 1.4% 2.2% 57% AI, AR & VR

95. 155 260 77 60 33 91 83 65 121 106 Startups in the machine learning / AI segment have benefited from the largest VC funding Funding and number1 of startups working in the AI market, by category 120190220240 330 390 490520 660 Recommen- dation engines Speech recognition Gesture control Virtual personal assistants Computer vision (applications) Smart robots Machine learning (general) Computer vision (general) Natural language processing Machine learning (applications) 2,070 Number of companies Total funding (in million US$) 95 Sources: Statista estimates, Medium 1: as of March 2016 AI, AR & VR

96. AI will also enable human voices to become a new powerful communication layer Number of third-party skills available for Amazon‘s virtual assistant 135 Q1 ’16 Q3 ’16 5,000 10,000 1,000 3,000 Q2 ’26 Q4 ’16 Q1 ’17 96 Sources: Amazon, Press reports AI, AR & VR

97. Augmented & Virtual Reality may be the next big tech opportunity Estimated global virtual & augmented reality headset development 2021 72.0 27.3 2016 10.0 0.1 Augmented Reality Virtual Reality Source: IDC Unit Shipments (in million) Revenue (in US$ billion) 97 2.1 48.7 0.2 18.6 2016 2021 AI, AR & VR

98. Global VR revenues are expected to increase to almost US$40 billion by 2020 Forecasted VR hard- and software revenues by platform in US$ billion 2020 1.2 1.6 40.4 2019 2.6 0.8 22.7 2018 2.0 1.8 12.1 2017 4.5 4.6 6.4 2016 8.6 3.0 3.6 8.3 5.8 16.3 15.6 8.5 PC Console Mobile Source: Superdata via VRFocus 98 AI, AR & VR

99. Table of Contents 99 › Connectivity: Numbers behind the “always on” trend………………………….. › Social Media: Love it, hate it, but accept that you need it…………………... › Platform Economics: A story about White Sharks and Swordfish……… › Venture Capital: Feed for new Tech-Unicorns…………………………………...... › AI, AR and VR: The next big Technology Hype………………………………………. Statista’s Digital Market Outlook Global Trends › e-Commerce……………………... › eServices……………………………. › eTravel ………………………………. › Digital Media……………………... › FinTech…………………………………. › Digital Advertising…………….... › Smart Home……………………...... › Connected Car…………………….. 91 83 30 20 5 181 171 160 148 138 129 117 106

100. The Digital Market Outlook (DMO) provides KPIs and insights for eight digital markets 100 Statista Digital Market Outlook coverage FinTech Digital Payments, Business Finance, Personal Finance Smart Home Home Automation, Security, Home Entertain- ment, Ambient Assisted Living, Energy Mgmt. eTravel Online Travel Booking, Mobility Services e-Commerce Fashion, Electronics & Media, Food & Personal Care, Furniture & Appliances, Toys, Hobby & DIY eServices Event Tickets, Fitness, Dating Services, Food Delivery Digital Advertising Banner Ads, Video Ads, Search Ads, Social Media Ads, Classifieds Connected Car Connected Hardware, Vehicle Services, Infotainment Services Digital Media Video-on-Demand, Digital Music, Video Games, ePublishing DMO

101. The DMO markets and forecasts cover a broad range of products and services 1: B2B and C2C markets are excluded 2: Resale of used goods is not included 101 DMO scoping B2C1 markets and revenues for… new2 products and services… covering 7 years, from ’15 to ’21.in over 50 regions and countries... DMO

102. Forecasts based on market-specific knowledge, enriched with macroeconomic developments Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 102 Macroeconomic overview 2016 United States Europe1 China GDP / Capita: US$57,220 US$27,599 US$8,240 Population: 323.3 million 671.2 million 1,382.2 million Households: 126.6 million 269.3 million 399.6 million Internet penetration: Mobile penetration: Social Media penetration: 81.9% 85.8% 69.6% 80.6% 20212016 60.5% 64.6% 72.2% 76.6% 60.2% 70.6% 20212016 48.5% 53.6% 50.9% 67.9% 44.9% 58.6% 20212016 37.3% 48.5% DMO

103. In 2018, China will overtake the U.S. and will become the biggest digital economy Source: Statista Digital Market Outlook 1: including all revenues generated within the e-Commerce, eTravel, eServices, Digital Media and Connected Car market 2: including France, Germany, Italy, Spain and the United Kingdom 103 Digital market1 development of the three major regions (in US$bn) 874 824 763 698 633 575 901 765 626 500 549 515 476 434 390 351 1,135 202120192016 2020 1,028 20182017 U.S. China EU 5 2 DMO

104. In 2016, digital expenditure in % of household consumption per capita are the biggest in China Source: Statista Digital Market Outlook 1: including all revenues generated within the e-Commerce, eTravel, eServices, Digital Media and Connected Car market 2: including France, Germany, Italy, Spain and the United Kingdom 104 Digital expenditure1 as share of household consumption per capita in ‘16 U.S. 10.6% 4.5% 5.0% Euro EU 5China EU 52 DMO

105. 18 101 78 584 997 1 10 24 54 273 13 41 63 355 623 E-Commerce is by far the biggest digital market people spend their money on Source: Statista Digital Market Outlook 1: including France, Germany, Italy, Spain and the United Kingdom 105 Digital expenditure per capita in the major regions per category in ‘16 Connected CarDigital MediaeServiceseTravele-Commerce EU 51 US$1,777 US$362 US$1,096 DMO

106. E-Commerce

107. 12,000,000 Chinese online retailer Tmall ships an incredible 12 million boxes per day

108. 108 Global1 e-commerce revenue (in US$bn) and CAGR2 16-21 by segment Global e-Commerce revenue is expected to almost double to US$2,108bn by 2021 Toys, Hobby & DIY 440.72 252.75 Furniture & Appliances 342.88 199.04 Food & Personal Care 218.35 104.67 Electronics & Media 472.62 290.61 Fashion 633.53 332.13 2016 2021 +13.8% p.a. +10.2% p.a. +15.8% p.a. +11.5% p.a. +11.8% p.a. Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 2: CAGR: Compound Annual Growth Rate E-Commerce

109. Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 109 The top e-Commerce markets exhibit growth and maintain their position in global ranking Total e-Commerce revenue by region (in US$ billion) Germany 56.25 81.01 Japan 74.40 111.80 United Kingdom 84.09 124.51 United States 322.17 485.27 China 376.18 839.54 2016 2021 E-Commerce CAGR1 ’16-’21 +17.4% p.a. +8.5% p.a. +8.2% p.a. +8.5% p.a. +7.6% p.a.

110. There are many product-specific big players in addition to large all-encompassing platforms Source: Statista Digital Market Outlook 110 Key players by segment and business model Fashion Electronics & Media Food & Personal Care Furniture & Appliances Toys, Hobby & DIY Market Places Online Retailer Direct Seller Key Player E-Commerce

111. China will dominate the online fashion world with a turnover of more than US$285bn in 2021 Source: Statista Digital Market Outlook 111 Projected online turnover from fashion (in US$ billion) 228.0 140.5 96.4 221.2 285.3 90.3 236.9 260.5 203.1 83.9 184.5 76.8 130.8 119.2 159.0 63.3 150.0 86.8 125.8 96.7 193.9 107.7 69.8 166.5 Europe China USA 2016 2017 2018 2019 2020 2021 E-Commerce

112. The Chinese B2C e-Commerce market outper- formed the U.S. both in size as well as in growth Source: Statista Digital Market Outlook 1: Prediction 112 B2C e-Commerce turnover from 2015 to 20171 in US$ billion 30.6 33.9 61.4 84.5 75.8 84.1 63.8 74.4 37.3 376.2 93.2 298.9 294.5 322.2 470.1 353.7 51.6 56.2 16.1 12.1 14.2 20.0 12.9 16.1 16.9 19.1 21.4 16.9 18.3 20.2 2017 2015 2016 China Russia South Korea Germany India U.S. Canada France Japan United Kingdom E-Commerce

113. Transparency and simple processes are most important for online shopping delivery Source: IPC online survey with 23,331 respondents (Sept. to Oct. 2016) 113 Most important aspects of online shopping delivery for customers 51%Possibility to select the delivery company Possibility to select speed of delivery 64% Possibility to place an order anytime, anywhere, on any device 64% Variety of payment options 69% Knowing which company will deliver goods 71% Landed cost calculator at check-out 79% Rapid response customer service 83% Free returns 86% Free delivery on purchases over a particular value 86% Simple and reliable returns process 88% Clear information about delivery charges before purchase 92% E-Commerce

114. Amazon leverages loyalty from Prime members; thus, incentivizing them is an important strategy Amount spent by U.S. Amazon customers in the past 12 months 0% 3% $20,000+$10,001 to $20.000 0% 2% $6,001 to $10,000 0% 3% $4,001 to $6,000 1% 7% $2,001 to $4,000 2% 10% $1,001 to $2,000 5% 16% $501 to $1,000 13% 24% $100 to $500 46% 26% Less than $100 34% 9% Prime Members Non-Prime Members Average spend per customer (past 12 months) Non-Prime $544 $2,486 114 Sources: Morgan Stanley Research, AlphaWise E-Commerce

115. Despite being #1 in the U.S. and Europe, Amazon has not yet cracked the Chinese market Source: iResearch China, U.S. Department of Commerce, Statista Digital Market Outlook 115 Market share of e-Commerce websites in China (in % of B2C sales) Amazon.cn 0.8% 6.7%Others Dandang.com 0.7% Jumei.com 0.5% Yhd.com 1.1% Gome.com.cn 1.2% Vip.com 3.5% Suning.com 4.3% JD.com 24.7% Tmall.com 56.6% B2C e-Commerce sales in 2016 US$376 billion US$322 billion E-Commerce

116. Discover more Online Shopping is not as profitable as you think 116 Discover more of our topic-related research for e-Commerce Statista‘s point of view + exclusive country-specific forecasts about: › Fashion › Electronics & Media › Food & Personal Care › Furniture & Appliances › Toys, Hobby & DIY Get the study Every topic in a nutshell – all relevant statistics in one single document: E-Commerce

117. eServices

118. Source: Tinder 1,400,000,000 Online dating app Tinder registers a daily average of 1.4 billion swipes on its platform

119. 119 Global1 eServices revenue (in US$ billion) and CAGR2 16-21 by segment Food delivery is the most dynamic eServices market, with revenues expected to triple by 2021 Food Delivery 210.32 72.86 Dating Services 5.874.60 Fitness 9.65 4.45 Event Tickets 50.81 25.06 2016 2021 +15.2% p.a. +16.7% p.a. +5.0% p.a. +23.6% p.a. Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 2: CAGR: Compound Annual Growth Rate eServices

120. Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 120 An estimated eServices market value of US$86bn by 2021 will increase China’s lead over the U.S. Total eServices revenue by region (in US$ billion) United States 61.18 25.28 China 85.99 33.10 Japan 10.02 3.81 Germany 11.29 5.01 United Kingdom 14.69 6.95 20212016 eServices CAGR1 ’16-’21 +21.0% p.a. +19.3% p.a. +16.2% p.a. +17.7% p.a. +21.4% p.a.

121. Event Tickets Fitness Dating Services Food Delivery Startups1 Established players Market complexity2 New market entrants create competitive pressures in the eServices market Source: Statista Digital Market Outlook 1: Founded after or in 2007 2: Estimate; considers value chain complexity and competitor landscape Selected key players by segment and market complexity 121 eServices

122. ElitePartner Baihe OurTime In Dating Services, different offerings are targeted at various audiences and types of relationship Source: Statista Digital Market Outlook Company information 122 Dating portals/apps segmentation of selected players Type of relationship Audience/coverage Casual Serious Mass Niche AshleyMadison Firstaffair Zoosk VictoriaMilan C-Date Badoo OkCupid ChristianMingle JDate BDSMSingles WooPlus Tinder Whiplr eDarling Grindr EuropeChinaUnited States Headquarters: Parship Momo Lovoo Meetic Chemistry TanTan Blued Neu LoveScout24 Match Plenty of Fish eServices

123. Sportswear giants are acquiring fitness apps; Under Armour is the most active player Sources: DC Reinmaker, Fortune, Runnersworld, Statista Digital Market Outlook 1: Under Armour also acquired Gritness in July 2015 for an unknown amount. 123 Sportswear companies’ fitness app acquisitions 45 70 20 80 20 $85 $240 $85 $475 $150 Endomondo Runtastic Runkeeper MapMyFitness MyFitnessPal Registerd users at the time of acquistion in million Acquistion price in million Acquisition price per user $7.50 $5.94 $4.25 $3.43 $1.89 1 Nov 2013 Feb 2015 Feb 2015 Aug 2015 Feb 2015 eServices

124. Fitbit leads the global wearables market; what can be expected from the Apple Watch? Source: IDC 124 Worldwide wearable device shipments by the Top 5 vendors in million 4.4 3.2 6.15.8 10.7 11.6 15.7 12.0 22.5 22.0 20162015 81.9 Global wearable device shipments 2015 20162014 28.8 102.4 eServices

125. Tinder and Badoo are the top 2 dating apps in terms of global1 downloads Sources: BBC News, App Aniie, Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook The most downloaded dating app by country 2015  Tinder  Badoo  Lovoo  Frim  Momo  Heartbeep  YYC  Paktor  WhosHere eServices

126. Selling food online is a promising business – especially in the U.S. Source: Statista Digital Market Outlook 1: includes meals ordered online and delivered by restaurants, delivery services and online orders collected by the customer; does not include phone orders and grocery deliveries 126 Online food delivery1 revenue forecast (in US$ billion) 9.6 2.5 0.8 13.3 39.9 GermanyUSA UK SpainFrance 6.0 2.1 3.8 2.8 7.3 20212016 +24.6% p.a. +20.2% p.a. +20.8% p.a. +23.2% p.a. +24.8% p.a. eServices

127. Despite not owning a single car, Uber’s market valuation is closing in on the big OEMs Source: Yahoo! Finance, CB Insights, livemint Note: Market cap as of 04-20-2017 127 Market cap/valuation of selected companies in 2017 (in US$ billion) 3.0 Lyft Inc. ANI Technologies Pte Ltd. (Ola) 3.0 Volkswagen AG 74.3 Toyota Motor Corp. Daimler AG 68.0 75.3 GrabTaxi Holdings Pte Ltd. Didi Chuxing Tesla Motors Inc. 33.8 6.9 49.8 General Motors Co. 51.0 Uber Technologies Inc. 147.3 Ride sharing providersAutomobile manufactures eServices

128. Discover more Everyone is taking a stab at online food delivery 128 Discover more of our topic-related research for eServices Statista‘s point of view + exclusive country-specific forecasts about: › Event Tickets › Fitness › Dating Services › Food Delivery Get the study Every topic in a nutshell – all relevant statistics in one single document: eServices

129. eTravel

130. 06-18-2016 The day online ride sharing company Uber reached a record breaking 2 billion users

131. 131 Global1 e-commerce Revenue in US$ billion and CAGR2 16-21 by segment The global eTravel market will almost double to around US$1 trillion by 2021 Mobility Services 288.11 Online Travel Booking 667.66 377.27 178.78 20212016 +12.09% p.a. +10.01% p.a. Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 2: CAGR: Compound Annual Growth Rate eTravel

132. Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 132 China displays the fastest growth in terms of eTravel revenues Total eTravel revenue by region (in US$ billion) France 25.61 40.93 Germany 32.53 44.35 United Kingdom 38.81 53.56 China 75.04 170.89 Untied States 188.76 269.74 2016 2021 eTravel +7.4% p.a. +17.9% p.a. +6.7% p.a. +6.4% p.a. +9.8% p.a. CAGR1 ’16-’21

133. Online Travel Booking Mobility Services Startups1 Established players Market complexity2 Companies in the eTravel market can be grouped into startups and established players Source: Statista Digital Market Outlook 1: Companies founded in or after 2007 2: Estimate; considers value chain complexity and competitor landscape Key players by segment and market complexity 133 eTravel

134. Four big players account for the major M&A activity within the Online Travel Booking industry Source: Statista Digital Market Outlook, Dealroom.co Selected players and selected acquisitions/ investments Ctrip eDreams ODIGEO Expedia Priceline 2016 Skyscanner US$1700m 2013 Liligo.com N/A 2015 Homeaway US$3900m 2015 PriceMatch N/A 2016 MakeMyTrip US$180m (27% stake) 2011 Opodo N/A 2015 Orbitz, eBookers US$1600m 2014 Hotel Ninjas N/A 2015 Tuniu US$500m 2011 eDreams Merger 2015 Travelocity US$280m 2014 Buuteeq N/A 2015 eLong US$400m (38% stake) 2011 GoVoyages Merger 2014 Wotif US$658m 2014 OpenTable US$2600m 2015 Travelfusion US$160m 2014 Auto Escape US$85m 2012 Kayak US$1800m 2015 Qunar 45% stake 2012 Trivago US$632m (62% stake) 2010 Rentalcars N/A 2015 Suanya US$16m 2008 CarRentals.com N/A 2010 Swoodoo N/A 2014 ToursForFun US$100m 2008 Venere N/A 2007 Agoda N/A 2014 Tujia US$100m 2001 Hotels.com N/A 2005 Booking.com US$135m 2013 Yongche US$60m 134 eTravel

135. Airbnb has reshaped the way we book accommodations Source: Airbnb Data & Analytics 1: Listings refer to entire flats, private rooms and shared rooms 135 Number of Airbnb listings in cities worldwide in 20161 23,000 26,000 20,000 23,000 33,000 46,000 Paris London 17,000 20,000 Los Angeles Barcelona Rome New York Rio de Janeiro 78,000 Sydney Copenhagen Amsterdam 47,000 eTravel

136. Fair deal? In major cities, taxi drivers earn significantly less than Uber drivers Source: Uber 136 Estimated hourly earnings of driver services in major U.S. cities San Francisco 23.87 12.96 18.43 Washington D.C. 14.53 Boston 16.23 14.26 20.68 12.54 18.46 New York 13.92 Chicago 23.69 Los Angeles 15.74 Uber Drivers (Net Earings Per Hour) Taxi Drivers & Chaufffeurs (Hourly Wages) vs. eTravel

137. Discover more Rethinking travel: Airbnb is just the beginning 137 Discover more of our topic-related research for eTravel Statista‘s point of view + exclusive country-specific forecasts about: › Online Travel Booking › Mobility Services Get the study Every topic in a nutshell – all relevant statistics in one single document: eTravel

138. Digital Media

139. 88,400,000 Virtual Reality is trending in Digital Media. In 2016 88.4 million Google Cardboards (Google’s budget VR solution) were shipped, demonstrating how big a trend it really is. Source: SuperData Research

140. 140 Global1 Digital Media revenue (in US$ billion) and CAGR2 16-21 by segment Revenues generated by Video Games overshadow other Digital Media 50.52 Video Games 15.27 ePublishing 67.10 21.22 16.16 23.89 13.20 Video-on-Demand 9.14 Digital Music 20212016 +8.1% p.a. +7.6% p.a. +5.8% p.a. +6.8% p.a. Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 2: CAGR: Compound Annual Growth Rate Digital Media

141. Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 141 The U.S. has the largest Digital Media revenues, while China shows promising development Total Digital Media revenue by region (in US$ billion) South Korea 4.36 2.90 Germany 4.16 3.07 United Kingdom 7.10 5.54 Japan 15.13 12.76 China 31.38 13.35 United States 39.98 32.51 20212016 Digital Media +8.5% p.a. +6.3% p.a. +5.1% p.a. +3.5% p.a. +18.6% p.a. +4.2% p.a. CAGR1 ’16-’21

142. In most Digital Media segments, very few players dominate the market Source: Statista Digital Market Outlook 142 Selection of key players in Digital Media Digital Music Video-on-Demand Video Games ePublishing Digital Media

143. Youtube is the world’s largest music streaming service and at no charge to users Source: YouTube, IFPI, Ipsos, Spotify, Apple, Pandora, Apple Music Youtube has 1+ billion users. According to a survey among 10,552 YouTube users from 13 countries, 82 percent use it to listen to music 143 Largest services for online music consumption and their number of users 820m 81m 4m 100m 50m 20m Total listeners Paid subscribers Digital Media

144. Spotify is the leading streaming service with the largest number of paying subscribers Source: Company Announcements, MIDIA 144 Worldwide paid subscribers of music streaming services (in million) ’Apr 2016 1.1 Dec 2016 4.4 Dec 2016 4.5 ’Jan 2017 6.9 Dec 2016 20.0 Mar 2017 50.0 Digital Media

145. 51.3 In Q4-’16, Netflix had more paying subscribers in the U.S. than the top cable companies combined Source: Company Information, MarketingCharts, Leichtman Research Group 145 Netflix subscribers vs. top cable companies customers in the U.S. (in m) 23.923.4 25.1 27.2 29.2 29.8 31.1 33.4 35.7 36.2 37.2 39.1 41.4 42.3 43.2 44.7 47.0 47.1 47.5 49.4 Q1 Q42012 Q1 Q42013 Q1 Q42014 Q1 Q42015 Q1 Q42016 17.2 4.6 0.8 0.4 3.1 48.7 Q4-2016 22.5 Charter Comcast Other major CableOne Mediacom Altice Paying U.S. Netflix subscribers Top Cable Companies Digital Media

146. eBooks and hardcovers are most expensive in Germany Source: Statista Digital Market Outlook As of April 5, 2017 146 Avg. price of the Top 10 bestsellers on Amazon (in US$) 1.19 20.49 24.64 3.39 7.86 10.96 eBook Price (US$) Hardcover Price (US$) 28% 17% 65% NY Times Bestsellers Spiegel Bestsellers Open Book Bestsellers eBook discount rate Digital Media

147. Discover more What comes after subscription in digital media? 147 Discover more of our topic-related research for Digital Media Statista‘s point of view + exclusive country-specific forecasts about: › Digital Music › Video-on-Demand › Video Games › ePublishing Get the study Every topic in a nutshell – all relevant statistics in one single document: Digital Media

148. FinTech

149. “If banks cannot truly be customer intimate, they are doomed to be just dumb commodities, acting behind the scenes, like utilities.” JP Nicols, Bank innovation consulting expert

150. 150 Global1 FinTech transaction value and Assets under Management (in US$ billion) and CAGR2 16-21 by segment Global1 Digital Payments are expected to more than double by 2021 Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 2: CAGR: Compound Annual Growth Rate 260 120 565 Personal Finance 1,753 Business FinanceDigital Payments 4,644 2,222 2016 2021 +15.9% p.a. +36.4% p.a. +46.5% p.a. FinTech

151. Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 151 It's early days for FinTech markets; however, the U.S. and China have promising prospects Total FinTech transaction value by region (in US$ billion) 104 126 156 765 824 163 225 323 China Germany Japan United Kingdom United States 2,861 1,983 2016 2021 FinTech +9.4% p.a. +12.3% p.a. +15.6% p.a. +30.2% p.a. +19.2% p.a. CAGR1 ’16-’21

152. Most prominent FinTech players can be found in the Digital Payment segment Source: Statista Digital Market Outlook 152 Representative FinTech key player by segment Digital Payment Business Finance Personal Finance Digital Commerce P2P Money Transfers Mobile Payments Crowd- lending Crowd- investing Crowd- funding Robo- Advisors Marketplace Lending FinTech

153. Profiteers in Marketplace Lending are Borrowers, Marketplaces, Banks and Investors alike Source: Statista Digital Market Outlook 1: Includes determination of loan interest rates, based on a prior credit scoring 2: Including initially agreed interest rate 3: Interest rate is based on credit worthiness of marketplace and therefor lower than for indivudual borrowers 153 Generic process overview and revenue streams Personal Lending Marketplace Loan application Borrower evaluation1 Loan listing Investment payout2 Loan issuing Loan repayment Investors funding Issuing Bank Loan purchasing Investors Loan granted Transaction fee from Bank, service fee from Investors Interest rate from loan issuance3 Return on investment from Marketplace Borrowers Borrower: Lending Market Place: Issuing Bank: Investor: Financial Benefits for parties involved FinTech

154. U.S. Mobile Payment transaction volume is expected to increase tenfold from ’16 to ‘21 Estimated U.S Mobile Payment transaction volume (in US$ billion) 2015 8.6 55.0 2016 24.9 99.4 20182017 2020 214.7 154.4 2019 2021 274.4 Average annual growth rate 2016-2021 62% 154 Source: Statista Digital Market Outlook FinTech

155. Robo-Advisors are most prevalent in the U.S.; only two of the biggest advisors are from Europe Top Robo-Advisors by assets under management (in US$ million) 403 454 574 671 751 808 222Scalable Capital Rebalance IRA Financial Guard Wealthsimple AssetBuilder Nutmeg Futur Advisor (Blackrock) Personal Capital 3,600 Wealthfront 5,010 Betterment 7,360 Schwab Intelligent Portfolios 10,200 Vanguard 47,000 155 Sources: Statista estimates based on company information, Press Releases, Graphiq, Nerdwallet, CNBC, Business Insider Information based on latest available data, as of February 2017. We do not claim that the information provided is complete. FinTech

156. Bitcoin remains the largest crypto-currency with a market cap of more than US$14 billion Market caps of the ten largest crypto-currency markets (in US$ million1) Bitcoin Steem 38.0 Augur 48.0 MaidSafeCoin 50.4 Dash 93.0 Ethereum Classic 109.3 Monero 148.3 Litecoin 203.4 14,003.7 Ripple 260.5 Ethereum 900.4 156 Source: CoinMarketCap 1: as of January 16th, 2017 FinTech

157. In 5 years, Bitcoin & Blockchain start-up funding increased from US$1m to over US$570m Source: CB Insights 157 Bitcoin & Blockchain funding and investment of start-ups (in US$ million) 572 501 343 90 1 20162015201420132012 FinTech

158. If you can‘t beat the FinTechs, join them No. of major bank investments in VC-backed FinTechs (Q3-'15 – Q3-’16) 27.7% 65.3% 6.9% Partner Irrelevant Competitor Competitor, partner or irrelevant? How banking executive view Fintech firms1 8 8 7 5 3 3 Citigroup Banco Santander Goldman Sachs Mitsubishi UFJ Financial Group UBS AG Sumitomo Mitsui Financial Group 158 Sources: KPMG, CB Insights, Capgemini 1: Worldwide survey; 2016 FinTech

159. Discover more How FinTech is reshaping the financial world 159 Discover more of our topic-related research for FinTech Statista‘s point of view + exclusive country-specific forecasts about: › Digital Payments › Business Finance › Personal Finance Get the study Every topic in a nutshell – all relevant statistics in one single document: FinTech

160. Digital Advertising

161. US$935.71 The most expensive keyword for Google AdSense (best mesothelioma lawyer) was closing in on a truly incredible cost of US$1,000 per click in March 2016. Source: searchenginewatch; Semrush

162. Digital Ads are expected to grow across all categories, with Search Ads taking the top spot Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 2: CAGR: Compound Annual Growth Rate Global1 digital advertising revenue forecast (in US$ billion) 69.8 Social Media 142.5 43.3 90.7 27.1 48.9 Banner ClassifiedsVideo 25.6 16.5 45.4 20.7 Search 2016 2021 162 +9.5% p.a. +12.5% p.a. +17.0% p.a. +9.28% p.a.+10.0% p.a. Digital Advertising

163. Digital Advertising revenues in China are expected to more than double by 2021 Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 163 Total Advertising revenue by region (in US$ billion) Germany 6.78 8.65 Japan 8.67 12.60 United Kingdom 14.25 21.51 China 43.90 98.69 United States 80.18 116.08 2016 2021 Digital Advertising +5.0% p.a. +7.8% p.a. +8.6% p.a. +17.6% p.a. +7.7% p.a. CAGR1 ’16-’21

164. SSP/Ad Network Trading Desk Ad Exchange Publisher $0.15 $0.14 $0.29 $0.05 $0.10 $0.15 Advertising Client Agency DSP $0.12 DMP/Date Provider $1.00 In programmatic advertising 60% of the budget can be allocated to service contractors Allocation of US$1 in programmatic advertising $0,61 164 Source: IHS Markit 2016, interviews with over 100 market players Note: share of DMP/Date Provider and DSP might be slightly higher Digital Advertising

165. There is a significant ‘ad spend gap’ for mobile Percent of time spent by consumers with media & percent of ad spend allocate to media in the U.S. 2015 39% Radio TV 36% 10% 13% Print 22% Internet 4% 16% 23% Mobile 25% 12% Time spent Ad spend 165 Source: KPCB Note: Print includes newspaper and magazine. Internet includes desk top, laptop & other connected devices; Excludes out of home, video games, and cinema advertising. Digital Advertising

166. Mobile Ad spending will continue to boom over the next three years Estimated change in advertising spending between ’16 – ’19 in US$bn p.a. -7.7 Radio -3.7Magazines -11.9Desktop Internet Cinema 0.8 6.8 Newspapers 2.9 80.5 0.9 Television Mobile Internet Outdoor 166 Source: Zenith Optimedia Digital Advertising

167. Social media & content marketing are top priorities for marketers Digital marketing budget plans for 2017 (in % of respondents)1 56% 55% 51% 50% 48% 46% 40% 34% 32% 29% 39% 42% 44% 43% 47% 47% 49% 53% 55% 63% 7% 11% 13% 13% 8% 7% 5% 5% 5%Social media marketing 3% Video advertising Content marketing Personalization Mobile marketing E-Mail marketing Webinars Display advertising Affiliate marketing Paid search Keep the sameIncrease Decrease 167 Source: Econsultancy, Adobe 1: based on a survey of 3,347 marketing professionals around the world Digital Advertising

168. There is a clear generational divide in news consumption Main news source by age group 12% 8% 24% 8%7% 7%8% 29% 37% 46% 53% 25% TVRadio 47% 36% 57% 64% PrintOnline 5% 6%6%6% 35-4425-3418-24 45-54 55+ 168 Source: Reuters Institute for the Study of Journalism Note: Based on a survey of 52,225 news consumers across 26 countries; numbers may not add up to 100% due to rounding Digital Advertising

169. 2019 will be a paradigm change: mobile/desktop internet ad spend is expected to overtake TV Source: Zenith Advertising Expenditure Forecast 169 Share of global ad spend by medium (in percentage) 0.6% 6.7% 6.4% 5.8% 10.9% 15.2% 18.9% 35.5% 0.7% 6.4% 5.8% 4.4% 8.3% 27.0% 14.7% 32.6% 2016 2019 Cinema Outdoor Radio Magazines Newspapers Mobile Internet Desktop Internet Televesion Television:  - 2.9% points Desktop Internet:  - 4.2% points Mobile Internet:  +11.8% points Digital Advertising

170. Discover more The future of advertising is 'fewer, better ads' 170 Discover more of our topic-related research for Digital Advertising Statista‘s point of view + exclusive country-specific forecasts about: › Banner Advertising › Video Advertising › Social Media Advertising › Search Advertising › Online Classifieds Get the study Every topic in a nutshell – all relevant statistics in one single document: Digital Advertising

171. Smart Home

172. Source: Statista Digital Market Outlook 57% of all Smart Homes in 2016 were located in the United States

173. The global Smart Home market will more than quadruple by 2021 173 Global1 Smart Home Revenue (in US$bn) and CAGR2 16-21 by segment Source: Statista Digital Market Outlook 1: only includes countries of the Digital Market Outlook 2: CAGR: Compound Annual Growth Rate 3.11 Security 22.12 4.17 Home Automation 25.31 16.82 12.03 2.91 Ambient Assisted Living (AAL) 5.59 Energy Management 0.56 Home Entertainment 14.25 20212016 +33.1% p.a. +39.6% p.a. +35.6% p.a. +58.4% p.a. +32.6% p.a. Smart Home

174. Smart Home market development is most dynamic in China and Germany Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 174 Total Smart Home revenue by region (in US$ billion) South Korea 0.64 2.84 United Kingdom 4.60 0.89 China 1.18 13.43 United States 10.43 32.19 Germany 0.93 3.76 2016 2021 Smart Home +34.5% p.a. +39.1% p.a. +32.3% p.a. +62.5% p.a. +25.3% p.a. CAGR1 ’16-’21

175. The Smart Home ecosystem consists of many intersections and entry points Source: Statista Digital Market Outlook 175 Illustration of the Smart Home ecosystem and value chain Manufacturer Offers devices Service provider Offers control software/ platform, connectivity, additional services Supply side Retail Websites Owned or third party Stores Owned or third party Technicians Sells, installs and maintains system data and/ or revenue Devices and/ or services Smart Home devices Sensors/ actuators to automate the home Demand side/ Customer ecosystem Control devices e.g. Smartphone, tablet or connected buttons Internet Enables remote access Platform Software to control devices Gateway Provides connectivity : Data Smart Home

176. The Smart Home company landscape comprises all kinds of origins Source: Statista Digital Market Outlook 1: Using the most relevant segment as most companies are active in multiple product segments 2: Estimate; considers the potential for integration with devices from other segments 176 Key players by segment1 and integration potential Generalists and Home Automation Security Home Entertainment Ambient Assisted Living (AAL) Energy Management Dedicated Smart Home companies Players entering the market from foreign industries Integration potential2 Smart Home

177. Digital Assistants will become increasingly more common in people’s homes Source: Statista Digital Market Outlook; Tractica, 2015 to 3rd quarter 2016 1: Forecast, figures do not include business usage 177 Estimated global number of virtual digital assistant users (in m) 710 504 390 2021 1,831 2020 1,642 2019 1,376 2018 1,016 201720162015 Hi, how can I help? 1 1 1 1 1 1 Smart Home

178. Echo & Co. will enter the Home Automation market and increase revenues fivefold by 2021 178 Smart Home automation market revenue (in US$ billion) 0.36 2015 2020 20.78 4.10 2.10 Total home automation market Thereof VPA-enabled wireless speakers Source: Statista Digital Market Outlook, Gartner Smart bulbs Traditional gateways/hubs Window/door sensor General control buttons/dimmers Garage door controls Shading devices Other home automation solutions VPA-enabled wireless speakers Smart Home

179. Americans are keen on Smart Home Security; could it be due to the high burglary rate? 179 Domestic burglaries per 100,000 inhabitants Smart Home security revenue per 100,000 inhabitants Source: Statista Digital Market Outlook, UNODC 290 282 196 $275,000 United States $209,000 $881,000 United Kingdom Germany Smart Home

180. Discover more Smart Home = Connected devices + integration 180 Discover more of our topic-related research for Smart Home Statista‘s point of view + exclusive country-specific forecasts about: › Home Automation › Security › Home Entertainment › Ambient Assisted Living › Energy Management Get the study Every topic in a nutshell – all relevant statistics in one single document: Smart Home

181. Connected Car

182. Source: Statista Digital Market Outlook 190,850,000 Connected Cars The predicted global number of Connected Cars on the road in 2021

183. Widespread connectivity is a prerequisite for the development of self-driving cars Source: Statista Digital Market Outlook 1: Following Zuboff‘s Laws about the implications of information technology Note: Width and height of bars does not correspond to the actual timeline or digital maturity 183 Gradual automotive development towards autonomous vehicles Mechnical devices replace manual actions › Indicators › etc. Mechanization Technological im- provement of car parts › Electric windows › Power door locks › etc. Electrification Introduction of embedded digital components › Radio data system technology › Parking cameras › Working parts sensors › etc. Digitization Interconnection of digital components › Embedded in-car connectivity › Connected working parts › Monitoring Real- time operating car- data › etc. Connectivity Incorporation of intelligent hard- and software › Autonomous driving › Vehicle-to- Everything communication › Automatic self- diagnosis systems › etc. AutonomizationDigital Maturity Time2017 “Every digital application that can be used for surveillance and control will be used for surveillance and control.1” ABC Mass market focus Digital maturity level Selected focus technologies per stage Technological status quo in the mass market Connected Car

184. Connected Car service subscription revenues are still falling short of OEM’s expectations Source: Statista Digital Market Outlook 1: Only includes countries listed in the Digital Market Outlook 2: CAGR: Compound Annual Growth Rata/ average growth rate per year 184 Global1 Connected Car revenue (in US$ billion) and CAGR2 by segment Infotainment Services 7.91 1.06 Vehicel Services 1.92 0.19 Connected Hardware 71.82 14.83 20212016 +37.1% p.a. +58.5.4% p.a. +49.4% p.a. Connected Car

185. A pioneer in integrated connectivity, the U.S. will stay the biggest Connected Car market by 2021 Source: Statista Digital Market Outlook 1: CAGR: Compound Annual Growth Rate 185 United Kingdom 1.33 5.24 5.92 1.03 Japan China Germany 16.92 1.84 1.91 United States 5.82 18.14 8.27 2016 2021 Total Connected Car revenue (in US$ billion) by region Connected Car +42.0% p.a. +31.5% p.a. +55.8% p.a. +34.1% p.a. +25.5% p.a. CAGR1 ’16-’21

186. Connectivity-related service packages are now available from most OEMs Source: Statista Digital Market Outlook 186 Key players and their digital service programs1 Europe North America Asia Manufacturer ConnectedDrive Audi Connect MercedesMe Car-Net R-Link UConnect Porsche Connect InControl OnStar MyCitroën Peugeot Connect Škoda Connect OnStar Sensus Connect SYNC3 OnStar OnStar OnStar UConnect EVE MZD Connect Mitsubishi Connect Entune Nissan Connect Enform UVO BlueLink Honda Connect Connect World STARLINK InTouch / Connection UConnect UConnect Connect Connected Car

187. Real-time traffic information is already widespread across the Western world and Asia Source: Company Information, Statista Digital Market Outlook 1: the four providers are Google (available in 61 countries), Here (52), TomTom (52) and Apple (46) 187 Availability of real-time traffic information by the four largest providers1 Covered by … 1 provider 2 providers 3 providers 4 providers Connected Car

188. Operating data collected from connected cars generates both potential and challenges Sources: AT&T, McKinsey, Verizon 188 Data generate per hour by Connected Cars compared to online activities 25,000 MB Vehicle data generated HD video streaming Web browsing Turn-by-turn navigation 5 MB 15 MB Music streaming 29 MB 869 MB Connected Car

189. Tesla’s investment intensity in R&D is much bigger than that of VW and BMW Sources: Company Information, Statista 1: R&D intensity is defined as the ratio between a company’s investment in research and development and its revenue R&D intensity of Tesla and selected car manufacturers in 20161 Toyota 3.7 Daimler 4.9 Ford 4.8 General Motors 4.9 BMW 5.5 VW 7.3 Tesla 11.9 Connected Car

190. Discover more Monetizing vehicle data – the future for OEMs? 190 Discover more of our topic-related research for Connected Car Statista‘s point of view + exclusive country-specific forecasts about: › Connected Hardware › Infotainment Services › Vehicle Services Get the study Every topic in a nutshell – all relevant statistics in one single document: Connected Car

191. Imprint Contacts and authors Released: Imprint Statista ▪ Johannes-Brahms-Platz 1 ▪ 20355 Hamburg ▪ +49 40 413 49 89 0 ▪ www.statista.com Disclaimer This study is based on survey and research data of the previously mentioned sources. The forecasts and market analysis presented were researched and prepared by Statista with great care. For the presented survey data, estimations and forecasts Statista cannot assume any warranty of any kind. Surveys and forecasts contain information not naturally representing a reliable basis for decisions in individual cases and may be in need of further interpretation. Therefore, Statista is not liable for any damage arising from the use of statistics and data provided in this report. April 2017 Tobias BohnhoffFelix Wegener Philipp HuhnSebastian Buss Kathrin Schreiber E-MAIL DMO@statista.com WEB statista.com/outlook

192. About the Digital Market Outlook 192 FinTech Digital Payments, Business Finance, Personal Finance Smart Home Home Automation, Security, Home Entertainment, Ambient Assisted Living, Energy Management eTravel Online Travel Booking, Mobility Services e-Commerce Fashion, Electronics & Media, Food & Personal Care, Furniture & Appliances, Toys, Hobby & DIY eServices Event Tickets, Fitness, Dating Services, Food Delivery Digital Advertising Banner Ads, Video Ads, Search Ads, Social Media Ads, Classifieds Connected Car Connected Hardware, Vehicle Services, Infotainment Services Digital Media Video-on-Demand, Digital Music, Video Games, ePublishing Exclusive part of the Statista Corporate Account Access to more than 1,000,000 statistics and all digital markets more informationmore information Details › 50 countries › Direct access & downloads › 7-Year coverage: 2015 – 2021 › Revenue forecasts › User count & penetration › Comparable data 9 Markets, 34 segments & 85 sub-segments