SPTI’s Unscripted Format Strategy Business Plan and Investment Requirements November 15, 2004

1. SPTI’s Unscripted Format Strategy Business Plan and Investment Requirements November 15, 2004

2. Executive Summary • Unscripted / Reality TV dominates the TV landscape and will be remain an important genre in the future • To benefit from the opportunities in this space, SPTI plans to leverage its worldwide production infrastructure, build on the successful Starling acquisition in France and expand its Reality TV efforts in Germany • Such an initiate will significantly close the gap to market leaders Endemol and Fremantle and keep SPTI ahead of the studio competition • Under conservative assumptions, this initiative will require investment capital of $11MM and new SPTI headcount of 7 in FY 06 (10 eventually).Pre-tax returns are very attractive: NPV of $6MM, IRR 38% • We request approval of the strategy and permission to start implementation asap

3. Agenda • Unscripted/Reality TV Overview • Proposed SPTI Strategy • Financial and Organizational Analysis • Next Steps

4. Unscripted TV Is Here To Stay Trista, Donald and Richard have established a bona-fide genre • Reality TV covers 22% of U.S. network primetime schedules in 04/05, vs. 10% in 03/04 • 7 of Top 20 shows in 03/04 were Reality: • 1. Idol, 4. Survivor All Stars, 6. The Apprentice, 19. Fear Factor • 63 Reality shows in 04/05 across all U.S. cable & broadcast networks • Launch of Reality-themed channels • Fox Reality Channel (2005) • Reality 24-7 (previously Reality Central) • ‘Reality TV’ channel (35MM subscribers, 125 countries) • Formats are being exported and exploited globally • Worldwide sales of The Apprentice, Queer Eye for the Straight Guy, The Bachelorette, Joe Millionaire, TheRestaurant, The Simple Life, The Swan,Next Action Star, etc. While the recent rush to Reality TV will abate, the unscripted genre will remain a key component of network schedules in the future

5. Economics Of Reality TV Highly attractive returns provide a strong incentive for networks to keep commissioning Reality TV shows • Higher profit margins for the networks due to lower production/commission expenses • Reality TV show cost $500K-1MM per hour, compared to average scripted shows of $2-3MM Source: Primetime Programming Cost Analysis, Morgan Stanley, March 2003 Source: Variety, 4/25/2004 • Successful Reality TV hits generate the same or higher advertising rates as scripted shows • Advertiser capitalize on new promotional opportunities, upside for producers and networks (e.g. GM/Viacom deal to make Saturn Ion the car of Survivor: The Amazon)

6. Unscripted TV Hits The big performers have proven to be highly profitable endeavors for the networks Source: Primetime Programming Cost Analysis, Morgan Stanley, March 2003

7. Origin Of Unscripted Formats International markets are a proven ground for developing successful formats with worldwide appeal

8. SPTI Is Currently Not A Player SPTI’s unscripted format library (primarily game shows) has been exhausted and can no longer provide momentum for the format business • Sales growth increasingly comes from titles acquired from 3rd parties • Limited funds for acquisitions provide access to B and C product only • Biggest revenue drivers in the past were Dating Game and Russian Roulette, both of which have passed revenue peaks

9. Agenda • Unscripted/Reality TV Overview • Proposed SPTI Strategy • Financial and Organizational Analysis • Next Steps

10. Crossroads For SPTI’s Format Business In order to take advantage of the global TV format opportunities, SPTI needs a new strategic direction Maintain Status Quo Increase Acquisition Efforts Strategic Alliances with Producers Original Format Development • Continue to exploit declining library • Pursue low-cost acquisitions without significant investments • Acquire formats and filmed episodes with guarantees • Co-finance development efforts • Form close associations to guarantee early access to fresh formats • Establish capabilities to develop formats with global appeal • Rapid worldwide implementation New Unscripted / Reality TV Initiative • Limited or no growth • SPTI marginalized as format player

11. Strategic Goals SPTI has set specific strategic goals for the Unscripted TV Format space • Become a relevant global creator and producer of Unscripted / Reality TV • Close the gap to market leaders Endemol & Fremantle Strategic Goals • Stay ahead of the studio competition & other emerging players • Contribute high profit margins to SPE after initial short period of investment

12. Format Development Focus To meet broadcaster’s shifting demands, SPTI will pursue the full range of unscripted programming Pure Game Shows Pure Reality Shows Reality-based Competitions SPTI Format Focus • Distinctions between categories are increasingly blurred • Demand from broadcasters is shifting across categories • Diversification protects against risk of betting on single niche genre

13. SPTI’s Leveragable Infrastructure SPTI’s worldwide production presence is a key competitive advantage for a new direction in Unscripted Formats • Worldwide Reach • Ability to leverage staff and relationships with broadcasters in all key markets Russia U.K. Germany France Italy Spain Latin America • ‘Project 2004’ in Germany • Enhance successful Reality TV project • 9 months (thru 12/04) • 6-person team • 20 formats created so far, 3 considered marketable • 1 being pitched to RTL, 1 to ZDF • Low-budget experiment; total expenses of <$250K • ‘Starling’ in France • Capitalize on acquisition of 2nd largest light entertainment production company in France • Starling is actively developing and pitching new formats • FY 05 revenue of Starling of $31MM, EBITDA $5.5MM

14. Operational Strategy SPTI plans to enhance its existing infrastructure in key markets and establish partnerships with proven players everywhere else Dual Strategy Goal: Balance between solid presence in key markets and rapid global establishment Tactic 1: Establish Worldwide Development Teams Tactic 2: Enter into Strategic Alliances • Align with proven production companies to develop formats • Leverage expertise & relationships of local players • Overcome barriers to entry • Key territories • Develop original unscripted concepts • Adapt 3rd party formats from around the world • Localize SPTI formats

15. Tactic 1: Development Teams Dedicated development teamswould be established in the key markets U.K., Germany and France (existing Starling operation) Head of InternationalProduction Roles & Responsibilities • Key executive in charge of unscripted/reality strategy • Strategic guidance of local reality teams • Management of Reality network Senior Format Executive (Los Angeles) • Manage development and acquisition effort in territory • Coordinate creative process with other territories • Collaborate closely with local head of production to sell formats to local broadcasters Local Format Executive (one per territory) Development team 1 Senior Producer 4 Freelance Jr. Producers (per territory) • Develop and test formats • Tap into local trends at early stage • Assess third party formats

16. Tactic 2: Strategic Alliances Alliances will expand SPTI’s reach into new territories and solidify the presence in the major markets Non-Major Markets Strategic Alliances are SPTI’s main effort to establish presence Major Markets Alliances will suplement SPTI’s dedicated development teams • U.K. • Germany • France • Spain & Italy - core E.U. markets for SPTI production • Benelux & Scandinavia - proven talent pool for successful formats • Latin America - strong overall growth potential • Forge close association with established local players • first-look deals, co-development efforts, etc. • Partners provide access to fresh formats and relationship to broadcasters • SPTI provides production infrastructure, library and international distribution • Potential equity investments in attractive local players • Relationship managed by local/regional SPTI production executive

17. Possible Alliance Targets

18. Dedicated Development Teams and potentially strategic alliances Strategic Alliances only Targeted Format Infrastructure SPTI’s Unscripted Format network will have critical mass and be able to compete with format players on a global level • Large and culturally diverse creative pool • Immediate assessment of worldwide appeal for new formats • Tap into local trends early • Rapid and coordinated implementation of formats across many markets • Synergies during production efforts in different markets

19. Agenda • Unscripted/Reality TV Overview • Proposed SPTI Strategy • Financial and Organizational Analysis • Next Steps

20. Business Volume SPTI will focus on fewer, but higher quality and higher margin formats than in the past Historic Product Volume/Mix (Number of Acquisitions) Planned Product Volume/Mix (Number of Acquisitions & Original Productions)

21. Estimated Production Slate Long-term focus on original development and higher-quality acquisitions Number of New Formats Brought To Market (Conservative Base Case) • Move towards higher quality acquisitions will require increased investment in upfront guarantees • Business plan assumes $2MM upfront budget per year • Acquisitions assume revenue split of 40% to original creator

22. Focus On Original Development Originally developed shows will be the main long-term driver for revenues and profitability Revenue in US$MM

23. Proposed Organization Head of International Production Sr. Format Exec Los Angeles (existing headcount) U.K. Format Exec (existing) Germany Format Exec (existing) France (Starling) Spain Format Exec (new, FY 07) Italy Format Exec (new, FY 07) Lat Am Format Exec (new, FY 07) Sr. Producer (new, FY 06) Sr. Producer (new, FY 06) 4 Jr Producers(freelance) 4 Jr Producers(freelance) Potential Strategic Alliance Potential Strategic Alliance Potential Strategic Alliance Strategic Alliance Strategic Alliance Strategic Alliance • New headcount of 10 required (5 per chart + 5 support admin staff) • 8 Jr Producers in development teams are freelance and not part of SPTI overhead • Personnel & freelance expenses starting at $2.2MM per year ($4.3MM in FY 10) • Local Format Execs closely cooperate with Head of Production in their respective territory

24. Financial Summary The financial base case applies very conservative revenue assumptions and provides attractive financial returns • Significant upside opportunities if production slate performs better than assumed in conservative financial base case model

25. Additional Upside Opportunities TV Distribution / Syndication Home Entertainment Product Merchandising • Self-contained shows have high syndication potential • FX paid $30 million over 4 years for Fear Factor. • AXN networks worldwide have paid $4.8MM for U.S. Versions of Amazing Race, Survivor and Fear Factor • Survivor: Higher volume of sales in English speaking markets than format sales • Launch of multiple reality cable channels provides another outlet for prints derived from int’l formats • Celebrity reality formats have significant Home Entertainment potential • Sequential shows have more upside • Simple Life sold 40K units on DVD • Survivor and The Apprentice also released on DVD • American Idol: • Sold over $50M at retail (May 2004) • Merchandising includes music, fashion, beauty, lifestyle and fan products; reaches a wide-spread audience loyal to the TV show and Idol brand

26. Next Steps • Approve strategy • Hire Sr. Format Exec • Set up development teams in key territories – U.K., Germany, France

27. Appendix

28. Detailed Financials