European and global IPTV Forecasts Surpass 2005 Estimates

MRG: reveals some noteworthy developments since the last IPTV (IP TV) Forecast in September 2005, including subscriber growth from 4.3 million to 36.8 million in 2005-2009; and system (cap ex) revenue growth from $740 million to $4.3 billion in 2005-2009. Reasons behind the developments include:

• Europe is surging ahead with a large number of strong IPTV deployments that include France Telecom, Free, Neuf in France, Telefonica in Spain, FastWeb in Italy, and a number of strong competitive offerings in Scandinavia.

• Uncertainties in large carriers in North America and Asia holds the forecasts for these regions down.

• Europe should be the strongest IPTV market through 2009, with Asia catching up by the end of the forecast period.

• IP TV set-top boxes will dominate the capital spending for IPTV services and account for two-thirds of (cap-ex) spending.

In forecasting four major regions and seven product/service categories, this forecast includes growth projections (by region) of the top 65% Service Providers (SPs) in 2006 –2009. No other IPTV Forecast tracks global cap-ex spending on the Service-Provider level. This allows suppliers to develop highly focused marketing strategies by region.

• With Mergers and Acquisitions (M&As) among suppliers on the rise, how do smaller companies respond to the new market dynamics?

• Why are the competitive and smaller carriers the best opportunity for smaller vendors?

• Why will the large carriers dominate the IPTV market until the end of the forecast period, in terms of subscribers and system spending, and what does that mean to suppliers?

• Since Europe offers the most varied opportunities for IPTV vendors, what unique opportunities are offered by the large, incumbent carriers, the competitive carriers, and the Eastern European carriers?

IP TV global Forecast 2006 to 2009 — March 2006 i

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