1. Online Gaming Perceptions Survey

2. Background The purpose of these surveys is to understand awareness and perceptions about online gaming safety and privacy from parents of gamers and gamers themselves. 600 online interviews were conducted between Dec. 1 st and Dec. 10 th, 2010 300 parents of gamers aged four years or older 300 gamers aged 18-24 years. Parents reported behavior for themselves and the child who plays games most often in the household Conducted by Cross-Tab Marketing Services 2

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6. Explore online games together Know the types of games kids play as well as the risks: Kids may download the good with the bad, bump into bullies, or befriend strangers Check the game ratings for age appropriate guidance: http://www.xbox.com/Marketplace/gameratings http://www.xbox.com/Marketplace/gameratings Stick to well-know games or gaming sites Review the game’s terms of play Agree on rules of play: http://www.getgamesmart.com/tools/pact/start/ http://www.getgamesmart.com/tools/pact/start/ Teach kids rules for safer gaming Keep personal info a secret Protect accounts with strong passwords: microsoft.com/protect/fraud/passwords/create.aspx microsoft.com/protect/fraud/passwords/create.aspx Create safe gamer names that are not suggestive or reveal personally identifiable information Play fair Never meet an online “friend” in person without safeguards in place Help kids avoid online gambling Get help from technology Defend your devices from Internet threats: Install antivirus and antispyware software Never turn off your firewall Keep all software current microsoft.com/security/pypc.aspx microsoft.com/security/pypc.aspx Use family safety settings: microsoft.com/protect/tools/childsafety/compare.aspx microsoft.com/protect/tools/childsafety/compare.aspx Get family safety tools and expert advice for safer gaming: GetGameSmart.comGetGameSmart.com What to do if there are problems Teach kids to trust their instincts and to ignore, block, and report unsettling conduct Report improper behavior and content to the game service Immediately report serious threats to NCMEC at (800) 843-5678 NCMEC Recommendations Recommendations for Parents 6

7. Nearly 1.5 Hours per Day are Spent Playing Online Games Q6A. How many hours per week does your child play online games?; Q6B. How many hours per week do you play online games? Q4. How many hours per week do you play online games? Average Hours/Week Under 18 = 10.2 Parents = 10.0 18-24 = 10.4 Playing online games with others is the norm – especially for 18-24 year olds 7

8. Q6A. How many hours per week does your child play online games?; Q6B. How many hours per week do you play online games? Q4. How many hours per week do you play online games? Parents Spend Considerable Time with Their Children Playing Online Games Average Hours/Week: Parents + Child = 5.8 Represents 58% of total parents online game time 8

9. Entertainment is the Primary Reason for Playing Online Games S9. Do you play online games (e.g., World of Warcraft, Call of Duty, Poker, etc..)?; Q1A. What might be possible reasons and/or benefits for your child playing online games? Q1B. Why do you play games online? Q11. Primary reason - Why do you play games online? 9

10. Type of Games Played Under 18 gamers Parent gamers 18-24 gamers Base 300224300 Action, Adventure Platform (Super Mario, Castlevania, Castle Crashers, Resident Evil) 66%47%77% Card, Board, Family (Poker, Uno, Monopoly) 34%66%59% Puzzle & Trivia (Hexic, Zuma, Tetris) 35%53%56% Strategy and Simulation (Command and Conquer, Starcraft, Sims) 35%34%49% Shooter (Halo, SOCOM, Counter Strike) 36%31%48% Sports and, Recreation (Wii Sports, Football, Baseball) 42%41%45% Music (Rock Band, Guitar Hero) 41%33%44% Racing & Flying (Forza, Need for Speed, Gran Turismo) 38%32%44% Role Playing (Forza, Need for Speed, Gran Turismo) 31%29%42% Fighting (Street Fighter, Virtua Fighter) 30% 39% Educational (Carmen Sandiego, Nancy Drew) 32%17%20% Others 5%4%2% Q3A. What types of games does your child play? Q3B. What types of games do you play? Q2. What types of games do you play? Action/Adventure & Card/Board Games are Most Popular Ranked 1st Ranked 2nd Ranked 3rd 10

11. Gamers Aged 18-24 Correspond Most Often While Playing Q8A. How often does your child correspond with other gamers while playing, via voice or text? Q8B. How often do you correspond with other gamers while playing, via voice or text? Q7. How often do you correspond with other gamers while playing, via voice or text? 42% 31% 35% 11

12. Social Networking Sites are Popular Gaming Destinations Q9A. Does your child visit social networking sites to play online games (e.g., Penguin, RuneScape, Facebook)? Q9B. Do you visit social networking sites to play online games (e.g., Facebook, Twitter, MySpace)? Q8. Do you visit social networking sites to play online games? Q9A. Are you a member of any online gaming communities? Q9B. If yes, please indicate the number of online gaming community (s) of which you are a member? Average # of communities* Gamers 18-24 = 2.7 *not asked of parents/child

13. Ranked 1st Ranked 2nd Ranked 3rd Game Community Under 18 gamers Parent gamers 18-24 gamers Base 164130167 Xbox LIVE 34%35%43% Farmville 48%54%38% Cartoon Network: Fusion Fall 13%6%31% The Sims 24%22%27% World of War craft 15%21%23% Mafia Wars 14%28%22% Halo 19%17%22% Counter Strike 4%11%13% RuneScape 15%10%13% What the Future Holds 4%6%9% Xbox 360 Evolved 13%11%8% 360 HQ 9%8%5% Webkinz 23%8%5% Free Realms 7%4% Club Penguin 34%9%4% Others 5%18%1% Don't know 8%2% 0% Xbox LIVE and Farmville are the Most Popular Online Gaming Communities Q11A. If yes, please indicate the community of which your child is member? Q11B. If yes, please indicate the community of which you are a member? Q10. Please select the names of the communities of which you are a member? 13

14. Concerns About Online Gaming Ranks Low Compared to Other Activities Q15A. As a parent of a child who plays games, how concerned are you about online risks while gaming? Q15B. Top One Concerns - In terms of online safety, which of the following activities of your child concerns you most? 1 st Top Concern 2 nd Top Concern Online chatting43%32% Browsing social networks20%27% Browsing the Internet20%23% Online gaming13%10% Email4%9% Level of parental concern about online activities 55% 14

15. Luring & Unacceptable Content Are the Top Concerns For Parents Q16A. What concerns you the most about online safety? Parents concerns about online safety Online Safety (General) Online Safety (Gaming) Base164 Luring (net)36%32% Grooming of the child20%19% Luring someone into physical meeting for unsavory reasons16%13% Unacceptable User-generated content (pictures, graphics, texts)21%14% Poor Behavior of others12%10% Violence9%7% Bullying7%4% Nudity4%2% False identity4%3% Discriminatory Language2%3% Malware or Viruses2%10% Profanity1%3% Credit card fraud1%4% Account takeover1%4% Dont know1% Attacks on Reputation-1% Billing fraud-1% Others--

16. Malware/Viruses & Fraud Are the Top Concerns for Gamers Aged 18-24 Q12. As a gamer, how worried are you about the following online risks while playing games? Please rate them on a 5 point scale where in 1 is Extremely worried and 5 is Not at all worried. 18-24 gamers online gaming safety concerns 18-24 gamers Base 300 Malware or Viruses 48% Credit card fraud 44% Billing fraud 43% Account takeover 37% False identity 31% Luring someone into physical meeting for unsavory reasons 29% Sexual Grooming 27% Bullying 27% Discriminatory Language 26% Attacks on Reputation 25% Profanity 25% Poor Behavior of others 24% Unacceptable User-generated content 23% Nudity 21% Violence 14% Direct attacks against me Attacks against my ability to play 16

17. One In Five Gamers Under 25 Has Experienced Abuse While Online Gaming Q17B. Thinking specifically about online gaming, has your child ever been a victim of any of the above? Q18. Please indicate which of the following issues your child was a victim of? Q13. Have you ever been a victim of any of the above? Q14A. Which out of the following have you ever experienced? N=464 Type of Abuse Under 18 gamers 18-24 gamers Base 2571 Profanity 44%51% Discriminatory Language 40%39% Unacceptable User-generated content (pictures, graphics, texts) 36%37% Poor Behavior of others 28%62% Bullying 28%30% Attacks on Reputation 28%30% Violence 20%18% Nudity 16%15% Credit card fraud 12%13% False identity 12%13% Grooming of the child/Luring 8%17% Account takeover 8%14% Billing fraud 8%11% Don't know 4%1% Luring someone into physical meeting for unsavory reasons -3% Others -3% 18-24 gamers 2x as likely to be abused 17

18. Two-Thirds Of Under 18 Gamers Stop Or Play Less Often After An Incident Q19. Did this change your child's gaming behavior? Q19A. What impact did it have on your child's gaming habits? Q15. Did this experience lead to any impact on your gaming habits? Under 18 gamers18-24 gamers Base 1571 Have stopped playing online games 40%1% My child plays less games now/I play less games now 27%15% Have started playing different games 20%8% No impact on his/her gaming habits 7%61% Others 7%3% Have reported the experience to concerned authorities 0%11% Did behavior change?How did behavior change?

19. Parents Believe Steps They Take to Protect Their Children Are Effective Q20. Have you discussed the risks of online gaming with your child before allowing him/her to play games? Q23. Have you enforced any restrictions on how much time your child can play online games? Q24. Do you restrict the types of games they play online? Q25. Do you restrict who they play online with? Q27. Which of the following steps have you taken to address the online safety of your child while gaming? Q29. Do you believe the steps you've taken to safeguard your child from the risks of gaming online have been effective? Steps taken to protect your child while online gaming Under 18 gamers Base300 Limit the amount of time my child is gaming online 60% Communicated clear rules and consequences of using gaming sites 57% Discussed the risks of gaming online56% Monitor my child’s gaming account49% Online gaming only in a family area (not in room with closed door) 49% Used parental control software to block risky sites 40% Play with my child27% Others2% Total303% Steps taken by parents Steps are consider effective 19

20. Victim of online abuse Steps Taken NoYesDifference Play with my child 28%5%23% Online gaming only in a family area (not in room with closed door)53%35%18% Do you restrict who they play online with?81%65%16% Limit the amount of time my child is gaming online67%60%7% Discussed the risks of gaming online59%55%4% Monitor my child’s gaming account55%53%2% Used parental control software to block risky sites40% 0% Enforce restrictions on how much time they play online games85% 0% Restrict the types of games they play online81%85%-4% Communicated clear rules and consequences of using gaming sites59%65%-6% Close Monitoring Is Best Defense Against Online Abuse Q17B. Thinking specifically about online gaming, has your child ever been a victim of any of the above? Q27. Which of the following steps have you taken to address the online safety of your child while gaming? Effectiveness of steps taken to protect child from online abuse while gaming 20

21. Poor Usability and Lack of Awareness Limit Family Safety Setting Usage Q21. Have you used family safety settings to monitor your child's gaming? Q22. Why don't you or haven't you used family safety settings? Reasons why parents don’t use family safety settings Under 18 gamers Base 132 I trust my child 54% Don’t believe they are very effective 19% Not aware of safety settings 18% Child knows how to get around them 14% Others 13% Aware of the settings, but Don't know how to use 12% Settings are not flexible to my needs 8% Settings require too much oversight and management 7% Takes too much time to set up 5% Not a good value for the money 4% Not easy to use 4% 53% Usability and Awareness issues 21

22. How do you decide which games to play? Under 18 gamers 18-24 gamers Base 300 Category of game46%51% Word of mouth from other parents, friends/family *45%61% Online reviews and research43%45% Game ratings38%22% Friends37%55% Self taught31%41% ESRB ratings23%6% New articles about the game18%17% Game publishers and platform manufacturers14%16% Game publishers website14%12% Pricing11%32% Availability of device/platform at home8%26% Others5%2% Category of Game, Other Parents & Friends Help Inform Which Games to Play Information sources: additional guidance Under 18 gamers Base 300 Regular newsletters 34% Online videos and guidance 32% Information through child schooling 31% In-game messages 30% Rewards based programs 25% Local educational classes 19% On-platform messages 16% Others 10% Ranked 1st Ranked 2nd Ranked 3rd *Attribute wording for 18-24 gamers = Word of mouth from friends/family 22

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24. PC & MAC are the Top Platforms for Playing Online Games Q2A. Which platforms does your child use to play online games?; Q2B. Which platforms do you use to play online games? 24

25. Gamers Aged 18-24 Reporting Knowing How to Handle Online Abuse While Gaming Online Q14B. Do you know how to address these issues as they arise? Q14C. Have you ever reported the abuse/issues you have experienced above to a service provider? Q15. Did this experience lead to any impact on your gaming habits? 25

26. Most Gamers Aged 18-24 Practice Specific Etiquette While Gaming Q16. Do you follow any specific gaming etiquette while gaming? Q17. Specifically, how do you practice gaming etiquette? Base 184 Play Fair (no cheating) 86% Treating other gamers with respect 79% Be a good sport (minimize revenge, compliment good play) 73% Don't send spam communications 71% Use appropriate language 61% Be patient with new players 61% Use reputation systems appropriately 46% Manage your game sessions (remove players for bad behavior) 43% Encouraging other players 42% Report bad behavior 41% Others 2% 26

27. Mobile Phone (38%)PC or Mac(76%) Shooter (42%) Educational (81%); Card Board, Family (76%); Sports and, Recreation (76%) ; Puzzle & Trivia (75%) Massively Multiplayer (41%)No interaction (86%); Peer to Peer (73%) Less than 3 hrs (95%)8-14 hrs (43%) Always corresponds with other gamers online (50%)Rarely corresponds with other gamers online (87%) “Heavy” gamers = 15-22hours + 23-30 hours + More than 30 hours “Light” gamers = Less than 3 hours + 3-7hours + 8-14hours Gamer levels (43%); I can be anonymous while playing online games (43%) Entertainment & Fun (75%); Level of achievement (71%) 13 to over 18 year old Boys (41%) 13 to over 18 year old Girls (24%) 8 to 12 year old Boys (83%) 8 to 12 year old Girls (95%) Visit social networking site, and are member of online gaming communities, such as Halo (55%), Xbox Live (48%) and The Sims( 45%) Over 8 in 10 claim that their child does not visit social networking site, and are member of online gaming communities, such as Club penguin (78%) and Farmville (68%), Webkinz(68%) Correspondence with other gamers (voice/text) Age & Gender Social behavior Reasons for playing online games Platforms used Type of games Type of gaming interaction Hours per week played with other gamers S1, D1, Q2a,b, Q3a,b, Q4a,b, Q5a,b, Q6a,b, Q7a,b, Q8a,b, Q9a,b, Q10ab Profile of “Heavy” vs. “Light” Gamers – Kids “Light” gamers “Heavy” gamers “Heavy” gamers = 15-22hours + 23-30 hours + More than 30 hours “Light” gamers = Less than 3 hours + 3-7hours + 8-14hours 27

28. Correspondence with other gamers (voice/text) Very often correspond with other gamers online (63%) Sometimes correspond with other gamers online (90%) “Light” gamers “Heavy” gamers “Heavy” gamers = 15-22hours + 23-30 hours + More than 30 hours “Light” gamers = Less than 3 hours + 3-7hours + 8-14hours 18-24 (60%) Almost equal distribution among male and female 65-74 (85%) Almost equal distribution among male and female Age & Gender Social behavior Visit social networking site, and are members of online gaming communities, such as Xbox LIVE (44%) and Mafia Wars (38%) Visit social networking site, and are members of online gaming communities, such as Farmville (70%), Cartoon Network (63%), and Mafia Wars (62%) Reasons for playing online games Characters in the game/Fantasy (40%) Level of achievement (38%) Entertainment & Fun (77%), Game relieves stress (73%), and Friends online social networking (71%) Platforms usedPortable game (Nintendo DS) (51%)PC or Mac(78%) Type of games Educational (41%), Role Playing (39%), Strategy and Simulation (39%) Puzzle & Trivia (75%); Sports and, Recreation (73%); Card, Board, Family (72%) Type of gaming interactionMassively Multiplayer (43%)No interaction (89%); Peer to Peer (73%) Hours per week played with other gamers 3-7hrs (86%) 8-14 hrs (41%) S1, D1, Q2a,b, Q3a,b, Q4a,b, Q5a,b, Q6a,b, Q7a,b, Q8a,b, Q9a,b, Q10ab Profile of “Heavy” vs. “Light” Gamers – Parents 28

29. © 2011 Microsoft Corporation. All rights reserved. Microsoft is a registered trademark of Microsoft Corporation in the U.S. and/or other countries. The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation. 29