2. 2
1 Initial PMC Strategy
PMC Product Overview2
3
4
PMC Results
Opportunity
Summary
5 New Business Model
3. 3
Develop an integrated and unique customer proposition in the Brazilian market taking
advantage of:
■ GVT’s cutting edge broadband technology and value chain control
■ Universal Music content catalogue and entertainment service development know how
Empower GVT brands with unique marketing and communication assets
Develop a new revenue stream
■ Innovative music service
■ Paid subscription for non GVT customers
■ Unique content offers (up to unlimited MP3s bundle packages)
■ Aggregate more content in the future
Initial PMC Strategy
4. 4
#1 Increase Sales
Increase the broadband gap offer thru differentiation
Give brand stature through association with
important artists
#2 Keep customers
for a longer period
Increase customer loyalty
#3 Increase POP´s
audience and stickness
Increase audience and time spent in POP portal with
new exclusive content
Increase POP s revenues with new paid services
Expectations on Music adding value to GVT
5. 5
#1 Increase Sales
Increase the broadband gap offer thru differentiation
Give brand stature through association with
important artists
#2 Keep customers
for a longer period
Increase customer loyalty
#3 Increase POP´s
audience and stickness
Increase audience and time spent in POP portal with
new exclusive content
Increase POP s revenues with new paid services
Expectations on Music adding value to GVT
Main Strategy
6. 6
1 Initial PMC Strategy
PMC Product Overview2
3
4
PMC Results
Opportunity
Summary
5 New Business Model
8. WebMobileAppTVApp
Oct/10
Launch New activation
process
Apr/11 Jun/11 Nov/11 Jan/12 Feb/12 Jun/12 Sep/12
New
layout
Sony content
Concert
New search
New layout
(actual)
Daily Playlists
Facebook likes
campaign
First live show
transmission
New logo
Favorites
Radio
Facebook login
Nov/11 Mar/12 May/12 Jul/12 Sep/12
Mobile App
launch
Version
1.2
Versions
1.3
1.4
Version
1.5
Version 1.6
New logo,
Favorites, Radio,
Facebook login,
Video playlists,
New player
Mar/12 May/12 Sep/12
TV App
launch
New version
with bugfixes
New Version
New logo, Shows
and Videos,
Favorites, Radio,
Video playlists,
Screen saver
PMC development timeline
8
9. WebMobileAppTVApp
Oct/10
Launch New
activation
process
Apr/11 Jun/11 Nov/11 Jan/12 Feb/12 Jun/12 Sep/12
New layout Sony content
Longforms
New search
New layout
(actual)
Daily Playlists
Facebook likes
campaign
First live show New logo
Favorites
Radio
Facebook login
Nov/11 Mar/12 May/12 Jul/12 Sep/12
Mobile App
launch
Version
1.2
Versions
1.3
1.4
Version
1.5
Version 1.6
New logo,
Favorites, Radio,
Facebook login,
Video playlists,
New player
Mar/12 May/12 Dez/12
TV App
launch
New version with
bugfixes
New Version
New logo, Shows
and Videos,
Favorites, Radio,
Video playlists,
Screen saver
PMC development timeline
9
Dez/12
Ivete Sangalo
live streaming
concert
Dez/12
Ivete Sangalo
live streaming
concert
Sep/12
Ivete Sangalo
live streaming
concert
10. PMC development timeline
WebMobileAppTVApp
2010 2011 2012
Portal Launch
Features
New activation process
New Look & Feel
Sony Content
Longform
New Search
Mobile App launch
Features
Daily Playlists
Facebook likes campaign
First live show
New logo
Favorites
Radio
Facebook login
Ivete Sangalo live streaming concert
Features
Version 1.2 - bugfixes
Version 1.3 - bugfixes
Version 1.4 - bugfixes
Version 1.5 – bugfixes
Version 1.6 - New logo, Favorites, Radio, Facebook login, Video
playlists, New player
Version 1.7 - Ivete Sangalo Live Streaming concert
TV App launch
Features
New version with bugfixes
New Version
New logo, Shows and Videos, Favorites, Radio,
Video playlists, Screen saver
Ivete Sangalo live streaming concert
10
11. 11
cost per user
R$ 1,0468
Label Pool Clearing
cost per user
R$ 0,9030
MKT Content
> 200K active users
Up to 200K active users
UMGI agreement
MKT Fee
MKT Fee 12,25% MKT Fee Net
HR
Artist image copyright
Marketing Initiatives GVT & PMC
Live concerts and showcases
Exclusive video or audio
Cultural contests
Taxes
12. 12
1 Initial PMC Strategy
PMC Product Overview2
3
4
PMC Results
Opportunity
Summary
5 New Business Model
13. 13
PMC results overview
272,000
ACTIVE USERS
DOWNLODED APPS
100,000
6 MILLION
STREAMS/MONTH
1 MILLION
STREAMS/MONTH
1 MILLION
LIKES ON FACEBOOK
240 K
PLUS 1 ON GOOGLE+
1 MILLION
MUSICS
50,000VIDEOCLIPS
14. 14
PMC customer base and gross additions
Customer base evolution (thousands)
Jun 2013:
10% penetration over broadband customer base
53% penetration over TV customer base
Gross additions (thousands)
29
36
33
37
22
25
27
21
28
16
Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13
Taylor Swift
project
User activation was boosted by the projects with UMGI
Ivete Sangalo
project
Highlights
■ Gross additions is composed of 83% TV’s customer
■ Exclusive content and highlight at Pay TV increase the
customer base
■ Taylor Swift and Ivete Sangalo Projects boosted the
gross additions
■ The lack of excluvsive content in 2013 lower the gross
additions
188
211
241 249 253 261
270 275
285
272
Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13
15. 15
PMC: active User Experience
Music and video streams (thousands)
4,977
3,864 3,908
4,214
3,633
3,109
3,711
3,060
2,733
2,166
20
1,133 1,064 1,158 956
697
1,000
794 780 767
Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13
Music Video
Video release
on Pay TV
Unique Login (thousands)
79
91
98
120
83
91
82
74
84
55
sep/13 oct/13 Nov-13 dec/13 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13
Ivete Sangalo
project
6 MM MUSIC
STREAMS PER MONTH
DOWNLOADED MOBILE APPS
100.000
1 MM VIDEOSTREAMS PER MONTH
16. PMC in social media
FACEBOOK
16
+256.417
PLUS+1 ON GOOGLE +
+1.186.987
LIKES ON FACEBOOK
+8.417
SEGUIDORESON TWITTER
GOOGLEPLUS
TWITTER
250 AVERAGEREACH
MILUSERS
2,5 AVERAGEREACH
MILLIONSUSERS
150 AVERAGEREACH
MILUSERS
18. PMC Key Takeaways
#1
#2
#3
#4
PMC TV is the most important factor for PMC activation
PMC helps improve GVT customer engagement
The investment on promotions are not bringing the desired activations and
buzz results
Exclusive and relevant content drives PMC activations like Justin Bieber pre-
listening , Ivete Sangalo Project and Taylor Swift showcase
18
19. 19
1 Initial PMC Strategy
PMC Product Overview2
3
4
PMC Results
Opportunity
Summary
5 New Business Model
20. PMC Strenghts
STRENGTH
PMC customer base relationship
300K active users
Strong presence in social media
More than 1 million likes on Facebook
and more than 190K plus 1 on Google
Plus
3 years product and delevop
experience
Strong relationship with record labels
Consistent platform
Young audience proximity
Specialists journalist in music
Music drives young audience
High cost of actual model
Cost per active user turn the current
business model unhealthy
Create Value Added for GVT
customers
Give proper value to a priceless asset
Add a new revenue
PROBLEMS
20
21. Music is a TOP interest on the target consumer: 20 – 35 years in Brazil
GVT is a well known brand scoring 90% of ‘aided brand awareness’
Despite that fact, the brand awareness decrease to 31% on ‘unaided awareness’
However, GVT is ahead of NET and Embratel (28%) and Telefonica (16%)
PMC is a excellent sales driver – 36% of PMC users define it as important/much important on choosing GVT
GVT is a strong brand – recognized by being the best offer and best service
PMC users registered a positive perception, higher level of satisfaction with the provider and are more likely to
recommend to friends and family
Recommendation is a key factor when choosing a telecom offer
GVT Brand
Consideration
95%
92%
74%
61%
GVT Customer - PMC User
GVT Customer - Not PMC User
Non-GVT Customer - Music Important
Non-GVT Customer - Music Unimportant
GVT Brand
Recommendation
Satisfaction with
current provider
Loyalty to
current provider
90%
90%
53%
48%
95%
92%
77%
83%
74%
68%
44%
57%
GVT and music relationship
21
22. PMC on Facebook has more likes than others online music player like XBOX music and Rdio
2nd brazilian online music service in Brazil on Facebook likes (Radio UOL is the first)
Less than a year, PMC grew more than 1 million likes with Facebook Ads campaign and interactions
PMC is gaining relevance in social media
1.6 MM
0.056 MM
0.3 MM
Portal Pop GVT TV GVT PMC
Likes on Facebook’s GVT Produts (MM)
0.8 MM
2 MM
3.7 MM
30 MM
XBOX Music Rdio Deezer
worldwide
Spotify
Worldwide
Itunes
Worldwide
… compare with others worldwide music services
(MM)
1.2 MM
PMCPMC 0.4 MM
22
PMC
23. Globalrecordedmusicindustry’growth
■ In 2012, the brazilian music market grew 5%
comparing with 2012 with R$ 392,8 MM
■ Brazil digital sales took off in 2012, following
the launch of itunes at the end of 2011, with
revenues expected to have nearly doubled
in the past 12 months
■ The total recorded music market grew by
11.2% in the first half of 2012 and by 8.6%
in 2011
■ In 2013, Deezer, Xbox Music, Tim
Music, Unlimited Music were launched in
Brazil
■ Spotify is expected to be launched in Brazil
on September 2013
Brazil:Amarketsettosurge
Global music revenues (US$ billion)
24
44 43 54 61
111
2007 2008 2009 2010 2011 2012
Digital
Share on market
+28%
Brazil digital music revenues (R$ million)
+83%
16.4 13.9 12.2 10.4 11.1
16.5
3.1 4.3 4.7 4.8 5.1
5.6
19.5 18.2 16.9 15.2 16.2
22.1
2007 2008 2009 2010 2011 2012
Colunas1 Digital
23
24. Onlinemusicplayers
Subscribers Catalog Business Model
n/a 12 MM 7 days trial
Unlimited
Web
Streaming
R$ 8,99
Mobile +
off-line
R$ 14,90
R$ 22,90*
R$ 29,90*
Highlights
Oi Partnership
Solid multi screen plataform
6 MM paid
subs
24 MM
total subs
20 MM
Free – Ad
supported
Unlimited
Streaming
$4,99
Streaming
+Mobile
Offline
$9,99
4 MM paid
subs
10 MM
total subs
20 million
15 days
Trial
Streaming
Ilimited
R$ 8,90
Mobile +
off-line
R$ 14,90
n/a 28 MM
Download a la carte: US$ 0.99/ US$ 1.29
Album a la carte: R$ 18
63% share digital music revenue
29% share global music revenue
Orange partnership
4 million pay subscription
150 countries
Brazil launched in January 2013
Worldwide expansion with 28 territories
Will be launch in September 2013
SFR Partnership
n/a n/a
Unlimited streaming + download
(Mobile, PC and Game Console)
$10 a month
•Launched in late October 2012
•Windows 8 will have shipped 350 million
units by the end of 2012.
24
25. 25
1 Initial PMC Strategy
PMC Product Overview2
3
4
PMC Results
Opportunity
Summary
5 New Business Model
26. 26
Develop a new
service
Current
business
model
discontinued
Convert PMC
base to a
subscription
paid music
service base
High added-
value features
and catalog
Add
Warner, EMI
and Som Livre +
New Features
Change the cost model
to a new revenue stream
model
New identity: new
brand, new look &
feel...Only the paid
subscription model
available
Assumptions adopted
28. 28
R$ 6,90 R$ 12,90
OTTserviceBase
New Business model offers
Exclusive offer for PMC user
Features:
• audio
• videoclip
• offline Mode
• SVOD (15 titles catalog)
• Available on
web, mobile, tablet and GVT
TV
R$ 4,90
Eliminate the current cost business model
PriceFeatures
R$ 4,90
PMCBase
29. 29
R$ 4,90 R$ 12,90
PMCBase OTTservice
New Business model offers
New GVT costmers offer
para novos
Features:
• audio
• Videoclip
• Offline Mode
• SVOD (15 title catalog)
• Available on
web, mobile, tablet and GVT
TV
Generate new revenue
Features Price
R$ 6,90
R$ 6,90
Base
30. 30
R$ 4,90 R$ 6,90
PMCBase Base
New Business model offers
OTT clients
Features:
• Audio
• Videoclip
• Offline Mode
• Available on
web, mobile, tablet, Conn
ected TV e Game Console)
Add Value for GVT customers
Features Price
R$ 12,90
R$ 12,90
OTTservice
37. 37
HR Organizational Structure
Gerente de
música
Editorial
Analista Sênior /
GP Pleno
Programador da
Rádio
Jornalista - Editor
Jornalista Jornalista
Comunicação &
Relacionamento
Coordenação
Comunicação e
Relacionamento
Analista sênior de
comunicação
Analista pleno de
comunicação
Analista de rede
sociais
Analista de
Relacionamento
Analista
Web design
Produto
GP Sênior
Analista de
marketing Sênior
Analista de
marketing Pleno
Comercial &
Novos Negócios
GP Sênior
Estratégia &
Marketing
GP Sênior
Áreas do novo serviço
Manutenção da equipe atual (em cinza no organograma) – 1 HC + 5 terceiros
39. 39
Development timeline – Expected Launch Q1 13’
Q2
NewMuiscBusiness
Business
Product
Strategy
BP development
BP
Approval
Q3 Q4 Q1
Features development
Record Deals Agreements
Launch strategy
Headcount
4 - 6 months
Layout development
IT development
Launch
New Music Service
40. 40
#1
#2
#3
#4
#5
The new revenue stream model offsets content costs with revenue e keeps
the GVT customer loyalty
The revenue share model offers a business division risk
The low capex involved makes this new model very attractive
The music industry is expanding and 2013 will be an important year for digital
music in Brazil with the release of worldwide player such as Deezer and Spotify
With 3 years music product experience makes easier to ensure a more
consistent and assertive development
New Business Model Key Takeaways