Nielsen Interactive Entertainment: The Mobile Entertainment Consumer & Active Gamer Studies E

1. Nielsen Interactive Entertainment: The Mobile Entertainment Consumer & Active Gamer Studies Emily Della Maggiora, Vice President March 29, 2006

2. Presentation Agenda • NIE Overview / Research Background • Mobile Entertainment Market Opportunity • Mobile Attitudinal Segmentation • Mobile Segments vs. Standard Demo’s • Mobile Gaming through lens of NIE Segmentation • Mobile Gaming and Active Gamer Crossover • Active Gamer Market Opportunity • Economics of the Video Game Marketplace

3. Mobile Entertainment Consumer & Active Gamer Studies prepared by: • Nielsen Interactive Entertainment (NIE) is a dedicated unit of Nielsen Entertainment, a VNU company • We aim to provide our clients the benefits of both global scale and industry specialization: • A client proactive division focused on the interactive entertainment industries delivering tactical research and strategic services • Our goals are based upon a disciplined and creative approach to market information and research: • To better understand and provide for entertainment and interactive consumers • To maximize clients’ profit potential and increase the overall commercial prospects of the industry

4. Research Background • For the first time in 2004/2005 videogame sales eclipsed US box office figures and the discussion of the ‘third screen’ regarding mobile was gaining fast momentum • Marketplace factors were dictating the need for consumer insights and a distinctive benchmark of consumer behavior to be trended over time • Subsequently Nielsen embarked on 6 months of marketplace interviews with industry stakeholders to define the research scope identify the need to know information in mobile and gaming • In October 2005 Nielsen conducted 2,000+ interviews per study, online, and weighted to offline incidence checks to deliver statistically significant results

5. Percent Projected US Population US Population 13-54 years 100% 170 Million Cell Phone Owner Population 85% 143 Million Mobile Ring tone Population 37% 56 Million Mobile Gaming Population 19% 28 Million Mobile Video Population 7% 10 Million Mobile Entertainment Market Opportunity Nielsen Media Research Home Tech Report provided offline incidence statistics Mobile Market Defined US Population – 2004 US Census 13-54 years Cell Phone Owner – Have active contract with US carrier (50/50 male/female) Mobile Ringtone – Have downloaded a ringtone Mobile Gaming – Have downloaded a game Mobile Video – Have downloaded and viewed “mobisodes”, mobile-exclusive commercials, movie trailers, music videos, broadcast TV, or watchtones onto their cell phone

6. 20 million 29 million 29 million 33 million 29 million Mobile Attitudinal Segmentation • In addition to providing marketers the traditional media breaks (age/gender) Nielsen chose to also pursue a multi-variant attitudinal segmentation strategy • Consumer were exposed to a list of 20 statements regarding their attitudes about cell phones and asked to rate the question on a scale of 0 “does not describe at all” to 10 “describes me very well” • Five market segments emerged out of question battery: Communicators, Busy Bees, Spearheaders, Technophobes & Utilitarian's

7. Entertainment gluttons view their phones as entertainment devices and spend a significant amount of their time on gaming, watching DVDs and movies in theatre and internet Spearheaders Highest Priority Segment 20% of mobile pop 29 million people 45 to 54 35 to 44 13 to 17 18 to 24 25 to 34 Feature Usage

8. Phones are a means to socialize and seek features that enhance their ability to communicate; they are the biggest fans of movie-going and DVD watching during off hours Communicators High Priority Segment 15% of mobile pop 20 million people 45 to 54 35 to 44 13 to 17 18 to 24 25 to 34 Feature Usage

9. Interested In Dowloading Games In Future • Males under 25 (11%) show the highest interest in future downloads, while the Spearheaders have an appreciable number of people interested in downloading. Important to note that Spearheaders have a notable 25-34yr constituency Highlights broader market segment

10. Average Cost Paid Downloading Games • Traditional media segmentation highlights men under 25 as driving the price point for downloading games at $4.77; however the opportunity becomes more robust when you unveil the profile of the Communicator segment as 56% female and also over indexing to the total at $4.51 per game

11. Times Downloaded a Game in 3months • Spearheader segment skews male and has the highest frequency of game downloads during the 3 month period at 2.9 games, which synchronizes with the males <25 segmentation at 3.1 games

12. Times Played a Mobile Game in 3months • A reported average of 16.7 for 13-17 years is the second highest frequency of gaming; however on either side of the 13-17 segment lands very robust figures for both the Communicators at 17.8 and Spearheaders at 13.9 where 52% of these segments are 18-34 years – an audience with clearly a higher discretionary income/market opportunity

13. Gaming Devices Total Active Gaming Population (All persons in Household) Installed Base among Active Gaming Population (Individual Gaming Devices) PC 74% 83,378,503 32,068,655 Sony PlayStation 2 61% 68,316,216 26,275,468 Microsoft Xbox 36% 41,102,556 15,808,675 Nintendo GameCube 31% 34,750,445 13,365,556 Mobile Gamer & Active Gamer Crossover

14. Active Gamer Market Opportunity • The Active Gamer is defined by being a minimum of 13 years old, own and personally plays on a gaming device and play at least one hour per week 8,958,394 6,146,578 33,143,801 9,130,101 18-34 representing 36% of the total marketplace 11,408,625 11,578,197 20,861,550 11,602,929

15. PC 11% 33% 2% 29% 1% 18% 7% Handheld Console What Do They Game On? • There is significant levels of platform cross ownership with the majority owning at least a console (Playstation2, Xbox or Nintendo GameCube) and then one other platform – PC or handheld device. Interesting three in ten or 29% of gaming own all three platforms demonstrating category commitment

16. Who Do They Game With? • Gaming is largely an independent activity however when someone else is involved it is more likely to be a friend or family member. In essence a game receives on average 1.9 exposures to consumers each time it is played The connected experience has growing importance

17. The WOW Factor… • World of Warcraft – currently the most popular MMO game; as of February 2006 reporting over 5 million subscribers paying an average of $12 per month and it is not just men… • Current console connectivity has moderate numbers of adoption where next gen hardware is designed for an online experience (Xbox 360 / PS3 / Nintendo Revolution)

18. Economics of Video Game Marketplace • Marketplace economics • Royalties • Development costs • Porting costs • Next Gen Programming • Learning curves • Product delays • SKU planning • Challenges of 11 platform options • Smaller penetration levels of next gen consoles

19. Learning’s Summary Gaming • Next Gen: 50% of active gamers stating they may wait until both the Xbox 360 and the PS3 are released before making a final decision • Moving Online: 57% of active games have played online • Women are Playing: While online-enabled console, MMO and gambling gamers are disproportionately male - 76% vs. 24% - casual gamers who play free online games such as puzzles are just as likely to be women as men, 49% vs. 51% respectively • Good Scores on Mobile Gaming: 18% of active gamers have downloaded a game to their cell phone, with nearly two-thirds (63%) rating their experience from good to excellent

20. Thank you! Questions please contact: Emily.DellaMaggiora@NielsenEntertainment.com 323.860.4608