antena 3€¦ · iptv press www. 8 antena 3 – jpmorgan ceo conference – july 2009 structural...

ANTENA 3JP MORGAN MEDIA CEO CONFERENCE 2009

Silvio González (CEO)

30th June – 1st July 2009

2 Antena 3 – JPMorgan CEO Conference – July 2009

ACCELERATE CHANGES IN THE SECTOR

PUBLIC TV: TVEDTT PAY TVCONSOLIDATION

Severe cyclical and structural changes

INNOVATION& CREATIVITY

DTT STRATEGYANTENA 3.0

INTERNAL CHANGESFLEXIBILITY IN CONTENTS & COSTS


The Spanish TV Ad Market is suffering the biggest recession of the last two decades

Cyclical changes: Advertising market in Spain

-20 %

-16 %

-12 %

-8 %

-4 %

0 %

4 %

8 %

12 %

16 %

20 %

'92 '93 '9 4 '95 '96 '97 '9 8 '9 9 '00 '01 '02 '0 3 '04 '05 '06 '0 7 '0 8 '09E

Real GDP growth

TV Ad. Market growth

Source : Banco de España (GDP) and INFOADEX (Advertising Market). 2009 consensus

?

TV Ad market growth since 1992


Cyclical changes: Advertising market in Spain

Source : Infoadex

Spanish TV Ad market

TV Ad market is currently at 2003-2004 levels in nominal terms and <2002 in real tems

3,073

2,1722,317

2,670

2,951

3,188

3,467

2002 2003 2004 2005 2006 2007 2008 2009E

€ NOMINAL TERMS: 2003-2004 LEVEL2,496

2,172 2,222

2,4632,616

2,727

2,887

2002 2003 2004 2005 2006 2007 2008 2009E

€ REAL TERMS: <2002 LEVEL


8 operators in Free-To-Air TV + additional Pay TV players Around 20 channels at present in FTA, more than 40 after analogue switch off

Structural changes: Stronger competition in TV

Audience Share Jan-May 2009 Total Individuals

TVE Forta A3TV T5 Veo TVCuatro Sexta

Source: TNS Sofres24h, Total Individuals: 4+

Net TV Thematic

DTTAnalogue and rest

22.4

14.116.7

15.6

9.17.1

1.2 0.4

7.5

Public TVs FTA TVs Pay TVs


Structural changes: Competition from other media

Audiovisual content predominance increases competition, forcing innovation in advertising

Radio

Mobile CLIENT

Television Internet (Vídeos)

Magazines www

Outdoor www

IPTVPress

www


Structural changes: Changes in TV contents & advertising

TV contents and advertising need to adapt to structural changes

Structural changes

MagazinesNewsSports

Realities

In house productions

Live contents

Live contents

Control over the content and thus the advertising

Contents

Product placement

Special initiatives

Sponsorships

Integrating the adsinto the contentsAds


Despite cyclical and structural changes, TV has maintained its appeal throughout the years

Market share by media

35.7 37.5 40.143.9 43.4

1991 1995 2000 2005 2008

TV

RADIO

PRESS

INTERNETOTHERS

TV leadership

Source: Infoadex (except 1991: Nielsen)


54

89

42

53

32

Radio TV Newsp. Magaz. Internet

%

Coverage by media

TV leadership

Source: EGM 1st survey 2009

TV is the leading media in terms of coverage


7%

52%2%

11%

8%5%

15%

Television is the media with the highest notoriety

TV leadership

Notoriety by media

Television

Internet

Magazines

Newspapers

Cinema

Outdoor

Radio

Source: IOPE. Total brand mentions / media. Ind. +14. FY 2008


TV leadership

Source : Internal estimates*Cost per thousand: Cost per 1,000 views of the ad (in euros)

5.6

7.0

8.59.5

3.62.7

TV RADIO SUNDAY SUPPL. INTERNET NEWSPAPERS MAGAZINES

CPT benchmarking by media

The lowest Cost per Thousand (CPT*) among the media


Forecasted recovery of TV Ad market following GDP trend

Advertising market in Spain

Source : Banco de España (GDP) and INFOADEX (Advertising Market)

100

150

200

250

300

350

400

'91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09E

'10E

'11E

'12E

'13E

'14E

'15E

Nominal GDP : 7.0%CAGR 91-07

Nominal TV Ad Market: 7.1%CAGR 91-07

R²=98.3%A

B

TV Ad market vs GDP

Based on historical correlation between GDP and TV Ad growth, Scenario A is more likely than B

+5-1

0%


DTT Penetration in Spain

DTT will become a reality in April 2010

DTT Penetration

4.25.2

6.0

7.5

9.3

Jan-08 May-08 Sep-08 Jan-09 May-09

Penetration55,8%

12%

20%

68%

2008 Jun-09 Dec-09 Apr-10

12,6%

32.6%

100%

0.6%

Phase I Phase II Phase IIIPilot Project

Analogue switch off schedule

2.2x

Source : TNS Sofres Source : Impulsa TDT

In million households % population


Antena 3 DTT channels: Neox & Nova

Development of a family of channels in addition to the core channel: Opportunity to increase audience share

Improved market leverage to face fragmentation Marketing focused on enhancing brand image: Neox and Nova: Wide commercial target, no contraints to contents

growth

•Young Adults•Females Children Sports News Fiction Politics Music Household

• Variety of contents• Higher growth potential

• Narrower commercial target• Limited growth

DTT channels

Target

Orientation Client Product


Source: TNS Sofres. 24h, Total individuals 4+

DTT: Advertising bundling

Unique simultaneous advertising across the three channels, as of 1st February 2009

High audience High prices

Low audience Low prices

Feb-May 09

15.2

1.5

No bundling

16.7

More attractive for advertisers (+GRPs)Wider coverageHigher frequency Better Day part mix

Higher revenues in DTT

Bundling

Feb-May 09


GRPs: Gross Rating Point.Source: TNS Sofres. 24h, Total individuals 4+

Why did Antena 3 make it possible?


Advertising bundling

Spanish Ad market based on GRPs* vs discounts

13

54

Age

Male Female

Affinity among the channels

0.65

2.3x 1.48

May 09Jan 08

Relevant audience share in DTT



Relevant audience for advertisers: A3 Group´s audience share

1616.3

15.9

16.816.716.816.7

16.7

Feb Mar Apr May

2008 A3 2009 A3 Group

Total individuals Commercial Target

Source: TNS Sofres24hTotal individuals: 4+Commercial Target: 16-54 yrs. Up to 10,000 inhabitants

+5.0%

+2.7%+4.4%

-0.6%

16.717

16.3

17.2

17.917.918.017.9

Feb Mar Apr May

2008 A3 2009 A3 Group

+10.4%+5.3% +7.2%

+4.1%


DTT: 24 h Audience Performance

16.8 16.7 16.8 16.7

15.215.514.9

15.6 16.6

17.6

Jan-09 Feb-09 Mar-09 Apr-09 May-09

Total individuals (Jan-May 2009)

Commercial Target (Jan-May 2009)

Source: TNS Sofres24hTotal individuals: 4+Commercial Target: 16-54 yrs. Up to 10,000 inhabitants

Leadership in Commercial Target

17.9 18 17.8 17.8

16.116.4

14.916.3

13.313.6


A3 Group (A3+Neox+Nova) A3 Group (A3+Neox+Nova)


DTT: Prime Time Audience Performance

14.713.6

16.2

18.5

16.017.0 15.715.3

16.316.0


Source: TNS SofresPrime Time: From 20:30 to 24:00hTotal individuals: 4+Commercial Target: 16-54 yrs. Up to 10,000 inhabitants

Closing the gap in Prime Time

17.8

16.6

14.9 16.1

19.2

13.113.4

18.3

17.2

16.6


A3 Group (A3+Neox+Nova) A3 Group (A3+Neox+Nova)

Total individuals (Jan-May 2009)

Commercial Target (Jan-May 2009)


A3 Group leads the DTT offer in 2009: the only player to monetise its audience share through advertising bundling

DTT channel overview

Jan-May 2009 Total Individuals

1.431.33

1.18

0.61

0.37 0.35

0.13

A3 TVE Net TV T5 Veo TV Cuatro La Sexta

Source: TNS Sofres24h, Total Individuals: 4+

Young Adult

Female

Children

Sports

News

Politics

ChildrenFiction

Fiction

Fiction

Fiction News

Music

Decor

Client Product


13.3 13.212.4

11.2

9.08.2

3.5 3.4 3.1 3.02.0 1.8 1.4 1.3 1.2 1.0 0.9 0.8 0.8 0.7 0.5 0.5

DTT household

Source : TNS SofresShare DTT (DTT: 100).24h, Total individuals 4+

In a DTT household, A3 Group holds the leadership among TV private players, widening the gap with Telecinco

Antena 3 TV18.7%

Telecinco TV15.7%

Jan-May 2009 Total Individuals


Why 3.0?

Antena 3.0: A Three-screen model

Three screens

Three channels

How, when & where


Antena 3.0


New BUSINESS

OPPORTUNITIES

INNOVATIONAntena 3 leads

audiovisual changes

BRAND IMAGE Antena 3, Neox & Nova

aligned with Internet and Mobile

Increases the value of the

ADVERTISING BUNDLING

Reinforces the MULTIPLATFORM

CONTENTconcept


Antena 3.0: Launched May 2009

Antena3.com Multiplexation Antena3.mobi


Previews and re-runs Watch and chat Exclusive contents (making

of, deleted scenes,…)

Live contents on the mobile phone (“El internado”)

Exclusive contents (making of, deleted scenes)

Mobile games

• Navigator 3.0: Graphic tools informing on the three-screen offer• Presenter 3.0: Continuity presenter informs on the most interesting

events on the three screens

DTT: Previews and re-runs “El Internado”: 1st episode

Simultaneous emission


5.6

9.2

3.8

2.1

May-08 May-09

Unique Users Visits

Antena 3.0: Internet

Website redesign based on Antena 3.0 strategy boosts visits, unique users and video streams as of may 2009

A3 Visits & Unique Users (MM)

Source: OJD/Nielsen Market Intelligence

19.3

22.9

May-08 May-09

A3 Group Video Streams (MM)

+78%

+110% +19%

Source: Akamai, Flumotion, Admotion, Youtube


Flexibility in contents

Cost contention in contents

60%63%

68%

2006 2007 2008

Occupancy by contentsTV Programming costs

2002 2003 2004 2005 2006 2007 2008

In-house production

External productionNOMINAL TERMS CAGR: +4.1%

REAL TERMS CAGR: +0.6%

Source: Antena 3Source: Antena 3


Large variety in contents

Flexibility in Contents

MarisolMarisol, 23, 23--F, F, Días Días sin sin Luz, Luz, Una balaUna bala….….Share 09: 15.8%

TV MOVIESTV MOVIES FILMSFILMS

SPORTSSPORTS ENTERTAINMENTENTERTAINMENT

¿¿Donde estás corazónDonde estás corazón? ?

Share 09: 19.8%

Champions League Champions League

Share 09: 40.1%

CinematrixCinematrix

Share 09: 15.5%

SPANISH FICTIONSPANISH FICTION

Los hombres de Los hombres de PacoPacoShare 09: 15.8%

Doctor MateoDoctor MateoShare 09: 19.9%

Física Física o o QuímicaQuímicaShare 09: 16.2%

El El InternadoInternadoShare 09: 17.4%

Source: TNS Sofres. Total Individuals:4+.January-May 2009


Flexibility in contents

Key guidelines

Align the organization

towards multichannel

production

Produce MULTIPLATFORM

content

Use Cross-media promotion capabilities

Optimize our Newsroom

Seek to interact with the audience

Antena 3.0

Antena 3.0 SMSContexta

Espejo publicoAntena 3 newsA fondo


Flexibility in costs

Changes in the industrial area of the business

2009 2010

Production services

Make-up &Hairdressing

News operators

Storage

Scenography

Align the organisation to maximize resources

• Flexibility in the use of the resources• Adapting costs to market standards

Programming

Contentpurchase

Product definition

Service externalization

TV businesstoday

...

Programming

Contentpurchase

Product definition

TV businesstomorrow


Re-design the role of state-owned television (TVE):

Changes in the sector: TVE

Timing Bill to be passed by parliament via “urgent procedure” so that it may come into force as of Q4 09

Obligations in contents

• Banned to counterbid against a private player for premium contents • Expenses capped on sports rights (max 10% on operating costs) • Max 70 premiere movies/year• Obligation to broadcast political, cultural and children´s contents• 60% of prime time contents to be produced in Europe

FinancingTVE´s budget 1.200 M€,as of 2010

• Public budget

• 80% on radiowave spectrum canon (max 330 M€)

• 0.9% tax on yearly gross revenues for telecoms

• 3.0% tax on yearly gross revenues for TV players

• 1.5% tax on yearly gross revenues from Pay TV suscriber fee

Sources



100 98 97

78

7075

86 (with TVE)

89 (without TVE)+3.5%

Effect in average prices

Marginal increase in average price without TVE

Source: Internal estimates. Prices in conventional advertising jan-may 09

Antena 3= 100



Prices

Prices today at 2003-2004 levels

Source: Internal estimates. Prices in conventional advertising jan-may 09

100

131

81 8393

114119

126

2002 2003 2004 2005 2006 2007 2008 2009

IN NOMINAL €: 2004-2005 LEVELS

100

131128126

1079899

131

2002 2003 2004 2005 2006 2007 2008 2009

IN REAL €: 2002-2003 LEVEL

2009= 100



CPT benchmarking

TV, >30% price gap to match the next cheapest media

Source: Internal estimates.

TV RADIO SUNDAYSUPPL.

INTERNET NEWSPAPERS MAGAZINES

+33%

3.6 3.6

5.6

7.0

8.59.5

2.7



CON A3 GRUPO

100 200 300 400

80.778.1

67.9

50.1

81.7

77.1

69

51.1

81.2

76.5

68.4

50.6

Coverage maintained without TVE

Coverage in Adults

GRPs

Without TVE1

CON A3 GRUPO

100 200 300 400

80.676

67.7

50

79.6

74.7

66.1

48.1

78.4

73.3

64.6

46.8

Coverage in Commercial Adults

GRPs

Source: TNS, PyB, proportional share by channel 1)T5: 35%, TVE1:33%, Cuatro: 15%, La Sexta: 16%. 2) A3:36%. T5: 33%, TVE1: 31%.

3) A3: 37%, T5: 34%, Cuatro: 14%, La Sexta: 16%; Adults Commercial: 16-55 H MH MM ML +10,000 inhab. April 2009


24.9

5.0

20.7

30.4

4.6

9.0

31.1 29.8

34.1

10.4

'4-12 13-24 25-44 45-64 >65


Profile of advertising campaigns maintained without TVE

WITHOUT TVEWITH TVE

+1,4

+2,9

-4,2

43.2

56.9

43.2

56.8

Male Female

61.0

39.0

59.6

40.4

HMHMM MLL

21.8

78.2

24.0

76.0

Hab -10M Hab +10M

Source: TNS, April 2009, Total Day

Genre

+1,4+2,2+2,2

Age

SocialClass

Population


Pay TV in DTT: a market opportunity? Current status:

Royal Decree, pending approval, to permit at least one Pay TVchannel in DTT per FTA TV player without additional government approval

Changes in the sector: DTT (Pay TV)

Satellite2.0 m

Cable1.3 m

IPTV0.7 m

Market opportunity12.1m non Pay-TV

households...

...of which >7m are not currentlyreached by Cable or IPTV

Source: CMT. 2008

Pay TV market penetrationIn mill households


Changes in the sector: DTT (Pay TV)

Subscribers & Penetration in Europe

Source: Screen Digest. 2008

Penetration Pay TV

25% 23%

55%

51%

57%

0

5

10

15

20

25

Spain Italy France UK Germany

0%

10%

20%

30%

40%

50%

60%

70%

MM subscribers Penetration2001 2004 2008

Satellite Cable IPTV Rest households

28% 21% 25%

12.3

15.016.1

Source: CMT, Antena 3

Stagnant pay TV penetration throughout the last decade and below the rest of the european markets

In million households


Changes in the sector: Consolidation

Reducing competition New rules in place for consolidation process

Combined audience share below 27% in previous 12M Combinations limited to two players

Current scenario

4 Commercial FTA TV players

Audience share

Market share

2 State-ownedTV players

46%

70%

35%

30%

Future scenario

46%

88%

35%

12%

2 or 3 Commercial FTA TV players

MAIN COMPETITORSMAIN COMPETITORS

Power ratio1.5x 0.9x 1.9x 0.3x

?

Source: Audience share:TNS Sofres. Total Individuals:4+.January-May 2009 / Market share: Infoadex


Changes in the sector: Consolidation

Private Public Private Public

Private Public Private Public

Spanish future outlook similar to other european markets



Source: Internal estimates from several sources


Faced with the most important cyclical and structural changes ever seen before, TV will maintain its appeal

Advertising and content will align with the new scenario

Commitment to innovation will transform changes into opportunities (DTT, Antena 3.0)

Flexibility in costs and contents is key for the future TV business

Changes in spanish media sector are creating new major growth drivers

Conclusions


Legal Notice

The information contained in this presentation has not been independently verified and is, in any case, subject to negotiation, changes and modifications.

None of the Company, its shareholders or any of their respective affiliates shall be liable for the accuracy or completeness of the information or statements included in this presentation, and in no event may its content be construed as any type of explicit or implicit representation or warranty made by the Company, its shareholders or any other such person. Likewise, none of the Company, its shareholders or any of their respective affiliates shall be liable in any respect whatsoever (whether in negligence or otherwise) for any loss or damage that may arise from the use of this presentation or of any content therein or otherwise arising in connection with the information contained in this presentation. You may not copy or distribute this presentation to any person.

The Company does not undertake to publish any possible modifications or revisions of the information, data or statements contained herein should there be any change in the strategy or intentions of the Company, or occurrence of unforeseeable facts or events that affect the Company’s strategy or intentions.

This presentation may contain forward-looking statements with respect to the business, investments, financial condition, results of operations, dividends, strategy, plans and objectives of the Company. By their nature, forward-looking statements involve risk and uncertainty because they reflect the Company’s current expectations and assumptions as to future events and circumstances that may not prove accurate. A number of factors, including political, economic and regulatory developments in Spain and the European Union, could cause actual results and developments to differ materially from those expressed or implied in any forward-looking statements contained herein.

The information contained in this presentation does not constitute an offer or invitation to purchase or subscribe for any ordinary shares, and neither it nor any part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.

antena 3€¦ · iptv press www. 8 antena 3 – jpmorgan ceo conference – july 2009 structural...

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