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2. MTV Networks AfricaA Case Study in Alternative Content Acquisition1st African Broadcast & Film Africa Conference24 September 2008 p. 2

3. Agenda Introduction to MTV Networks Africa Our brands Our content proposition Our multi-pronged approach to distribution across Africa • Program sales • Terrestrial block • 24-hour channels • Off-air channels Challenges Conclusion

4. The beginnings of MTV Networks Africa MTV as a global brand and institution • Recognized around the world as the foremost provider of music programming and entertainment • More than 20 years of experience and knowledge about what makes young people tick The idea of an MTV Networks Africa was conceived in 2004 • To win over skeptics, we needed to develop a business case for Africa • Brand: Needed to introduce and translate our global brand for an entirely new market • Content: Needed to develop content that catered to tastes and attitudes of local audiences Distribution: Get our content out to as many people as possible in as many ways as possible MTVNA launched in Africa in 2005 to huge success, far exceeding expectations • Now reaching >50M viewers and carried by all the major Pay TV operators and the largest terrestrials • Brand strength evident in all markets • In South Africa, MTV and MTV base are voted the #1 and #2 music channels for 3 years running • 2008 marked a year of milestones, paving the way forward for greater growth and experimentation • Host of the first-ever MTV Africa Music Awards, sponsored by Zain • Launch of Nickelodeon brand • Experimentation with incorporating and moving content onto digital platforms Going forward, our plan for growth focuses on further expanding our footprint and brand awareness in Africa

5. Aspirational Brands that young Africans aspire and relate to BRAND Emotional & Mental Compelling content that is locally relevant CONTENT Physical On every platform 360° - TV, on-the-ground events, radio, mobile and online DELIVERY MTVNA engages with its viewers on several levels MTV’s deep relationship with young people driven by a strong understanding of their aspirations, the content that excites them, and their preferences for media consumption

6. Our discussion today The opportunities and challenges we have in engaging with our African viewership while utilizing alternative content development and acquisition methods Aspirational BRAND Emotional & Mental CONTENT Physical DELIVERY Image sources: http://o.aolcdn.com/art/ch_travel/africa, www.our-picks.com, www.mrgadget.com.au, www.electricpig.co.uk, www.techpartz.com

7. Agenda Introduction to MTV Networks Africa Our brands Our content proposition Our multi-pronged approach to distribution across Africa • Program sales • Terrestrial block • 24-hour channels • Off-air channels Challenges Conclusion

8. Our brands Brand The power behind evoking the aspirations of viewers and audience is evident in the strength of our brands across the world MTV is the iconic global brand at the intersection of music, creativity and youth culture, giving each new generation a fresh creative voice that entertains, informs and unites MTV base stands for cutting-edge urban music entertainment with a local flavor for dedicated music fans of R&B, hip hop and rock VH1 is where mature music lovers go for their music, pop culture and entertainment Nick is the hugely successful brand that puts “kids first”, connecting kids with each other and providing them premium kid-centric educational and entertainment content All four MTVNA brands share a common mission to build up capacity and talent in the African entertainment industry

9. Agenda Introduction to MTV Networks Africa Our brands Our content proposition Our multi-pronged approach to distribution across Africa • Program sales • Terrestrial block • 24-hour channels • Off-air channels Challenges Conclusion

10. Examples Approach Our content proposition MTVNA benefits from having both credibility derived from world-class international content and local relevance from selective local content partnerships • Select shows with local appeal • Package with localized on-air look and feel • Promote with local VJ personalities • Pimp My Ride • Cribs • The Hills • Made • Total Request Live • My Super Sweet 16 • Dismissed • Making the Band • Video Music Awards • Europe Music Awards • Music videos and music programming Proven international content 1 • Hand-pick locally compelling content ideas • Partner with local players of a like mindset • Create / launch new programming • Promote with 360 exposure and on-the-ground events • MTV Africa Music Awards with Zain • Making the Video with Shell • Club MTV Angola with LG • TRL Radio with KFC and 5fm • Advance Warning with Zain • Player with Sony Ericsson • Be True with Nike • E. Africa VJ search with Coca-Cola • Nigeria VJ search with MTN Select localized content 2 The challenge is always to leverage our proven international content and concepts while catering to local tastes

11. Approach Local commercial partnerships To further build its local relevance, MTVNA takes proven concepts from MTV Networks International and translates them for the local market with select commercial partners VJ Search with Fanta • Initiation and briefing • Client may approach MTV with a particular occasion or intent (e.g., launch, branding, anniversary, etc.) • MTVNA may approach potential partners with a compelling international property it plans to localize • Brainstorming • Ideas refined in internal inter-department meeting with production, digital media, marketing, etc. • Proposal • Based on brief and brainstorm, proposal generated meeting both parties’ goals • Execution of all elements • On-air component • On-the-ground events • 360 advertising • Digital media elements and marketing 1 2 3 4 MTV adopts a heavily collaborative approach with all our commercial partners in order to deliver the best creative solutions

12. Agenda Introduction to MTV Networks Africa Our brands Our content proposition Our multi-pronged approach to distribution across Africa • Program sales • Terrestrial block • 24-hour channels • Off-air channels Challenges Conclusion

13. Market overview1 Multi-pronged distribution strategy Our distribution across Africa Distribution Given the dynamics of the African market, it is important for MTVNA to distribute its content across as many platforms and through as many channels as possible Overall market: • Slow but steady liberalization of the broadcast sector since the 1990s • Youngest population in the world with an average age of 18.2 years vs. 25.9 in Asia, 24.5 in Latin America and 24.1 for the developing world as a whole Advertising spend • Ad spend in Africa estimated to be $4.9B, with 69% in South Africa alone and nearly 90% concentrated in the top 10 markets • Strong growth in ad spend • From 2002-2006, South Africa experienced annual growth of 17-20% in ad spend • 45% YoY increase in Kenyan ad spend in 2006 • TV share of ad spend ranging 20-40% in key markets: 16% in Uganda vs. 40% in SA and Nigeria vs. >50% in Ghana Television • Nearly 50% of sub-Saharan countries have licensed free-to-air TV channels • Pay-TV dominated in Anglophone markets by DStv, GTV and Hi TV in Nigeria • TV ownership projected to grow 17% from 46M in 2007 to 54M in 2010, withpenetration <10% in most African countries (though 12% in Nigeria and 17% in SA) • Sell high-performing programs to local channels • E.g., Pimp My Ride with SABC Program sales 1 Terrestrial blocks • Partner with terrestrial players for specific time slots • Provide and tailor programming to that time slot • E.g., AIT, TV3, NTV, WBC, TBC 2 • Partner to air content 24 hours/day • To date, have only partnered with pay TV players • E.g., DStv, GTV, Hi TV 24-hour channels 3 • Partner for innovative delivery via radio shows, live events, online and mobile solutions • E.g., TRL Radio, Club MTV Off-air channels 4 Source: Balancing Act, African Broadcast and Film Markets (2008)

14. Distribution: Our reach MTVNA programming reaches >90M viewers in 21.5Mhouseholds in 48 countries across Africa while commercial activity concentrated in 6 markets Key commercial markets Source: Commercial distribution reports; Map from http://policyafrica.org/africa-map.gif

15. Overview Distribution: Program sales MTV Networks’ programs represent the best of what’s out there in youth programming, but critical to understand what will play well in the local market Cribs Approach • Program sales team receives interest from 3rd party broadcasters • Program team presents full suite of programs (from all MTV Networks channels) that suit the broadcaster’s particular needs Status • To date, >500 program sales deals conducted across the continent • Sample sales: • South Park to MNet • iCarly to KTV • Pimp My Ride to SABC in South Africa 1 2

16. Approach Distribution: Terrestrial blocks MTVNA seeks to work with terrestrial partners who are able to both add and derive great value from partnership Case study: STV Nigeria block Relationship initiated in 2005 • Late-night (10:30-11:30PM) time slot not performing well for STV and not attracting any ad spend • MTV began supplying content for the late-night slot • MTV base chart and other music based shows • STV and MTV began a joint sales effort for the block Outcome successful for both parties • Advertisers, especially beverage, responded very positively to content • Partnership was even successfully in generating advertising competition during what was previously a dead slot Value generated for STV on both ends • Input: Higher-quality content than would have otherwise been possible to produce in-house • Output: Higher ratings and greater advertising revenue • Identify the right partners, with shared goals, in order to create a win-win situation for all parties • MTVNA provides: • Compelling content • Pan-African advertisers • Brand association • Marketing • Terrestrial partner provides: • Distribution platform • Access to the mass market • Understand partner’s needs and determine the right content • Together with partner, go out and sell terrestrial block to advertisers 1 2 3

17. Distribution: 24-hour channels Ability to deliver 24-hour channels is the mainstay underlying all our operations To date, MTVNA has only partnered with pay TV providers to deliver our 24-hour channels • DStv (4 channels, pan-Africa): MTV base, MTV, Nickelodeon, and VH1 • GTV (2 channels, pan-Africa): MTV base, Nickelodeon • AIT (1 channel, Nigeria): MTV base • Hi TV (1 channel, Nigeria): Nickelodeon Having built an established, pan-African distribution network, MTVNA is now exploring partnerships to further localize our 24 hour channels • Terrestrials • An opportunity to tap new markets and bring high-quality music entertainment to the masses • Digital Terrestrial Television (DTT) • Potential to further develop and associate the MTV brands with cutting-edge innovation and content delivery

18. Highlights Distribution: Off-air channels MTVNA lives up to is creative and innovative reputation not only in its content, but also in its delivery methods TRL Radio On-the-ground events • The MTV Africa Music Awards • Club MTV parties • VJ searches Radio • TRL Radio – first-of-its-kind program to be adapted to both TV and radio platforms Online • MAMA My Video Award – a unique participatory experience for viewers to show off their video-making skills and rub elbows with stars Mobile • MXIT social networking community in SA – just launched in July and already one of the fastest-growing, acquiring 50,000 members/month TRL Radio

19. Agenda Introduction to MTV Networks Africa Our brands Our content proposition Our multi-pronged approach to distribution across Africa • Program sales • Terrestrial block • 24-hour channels • Off-air channels Challenges Conclusion

20. Challenges Selling and distributing in Africa faces challenges that are largely structural Limited infrastructure and capacity • High costs of delivery within Africa impact both production costs and timeline • Imperfect payment systems result in difficulties collecting payments • Limited high-quality production partners across Africa Regulatory environment • Compliance with local audience regulations difficult when you are in multiple markets and constantly producing new content • Piracy in many of our markets continues to pose a risk for our brands Sponsored Production • Focus on ratings and audience metrics, combined with lack of a reliable ratings system, undervalues the power of our brands, which extend far beyond our traditional viewership

21. Agenda Introduction to MTV Networks Africa Our brands Our content proposition Our multi-pronged approach to distribution across Africa • Program sales • Terrestrial block • 24-hour channels • Off-air channels Challenges Conclusion

22. The path forward Based on our business as a case study, the African content business has a strong growth opportunity but the following things must happen: Strike a better balance between international and local content Produce higher-quality local content that can travel so costs can be amortized Develop partnerships geared towards delivering value to each party’s bottom line Build an environment that provides programmers reassurance that their content will not be distorted or misused Increase our technological bandwidth and find a way to make the cost of delivery cheaper – e.g., tapeless Develop more expertise in content scheduling so that it can be monetized beyond the “Prime Time” sale Be more collaborative and share best practices across the continent – we need to trust and support of each other especially as we are pursuing new and innovative initiatives 1 2 3 4 5 6 7 Thank you