1. PROCAMS 2005 Chris Chinnock Insight Media

2. It’s a Jungle Out There A 10,000 foot view of the competitive landscape in consumer display markets

3. Focus – Only market research firm with an exclusive focus on microdisplay-based products Products & Services – Newsletters – Reports – Conferences – Consulting Services Insight Media Overview

4. The TV Revolution is Underway CRT to Multiple Technologies – Thin CRTs – Projection Front and Rear CRT, LCD, DLP, LCOS technologies – LCD – Plasma 4:3 to 16:9 Analog to Digital Standard Definition to High Definition

5. Technology Battlegrounds 30”36”46”56”66” CRT RP CRT FP LCD PDP µD RP

6. The Weapons Screen Size Resolution Brightness Contrast Price Form Factor Cosmetics Features Training Promotion Brand Channel Supply Chain

7. Big Screen Displays Increasing ASPs rising too – How many industries can claim that?

8. The Buying Process Promotion, friends motivate into stores PDP-TVs attract most attention Price may push to – Different Technology – EDTV Consumer gets educated – Resolution, DVR, TiVo, home theater, etc. Leaves frustrated to learn more or give up

9. Retail Environment New brands popping up rapidly – Retailers, Chinese, Taiwanese, Korean, others New ways to buy TVs – E-tailers, PC/IT channel, warehouse clubs Consumers buy on: – Price – Image quality – Form factor, features & style Consumers don’t really care about technology

10. The After Purchase Reality Too complicated to set up Too complicated to operate/too many remotes DVDs/HDTV looks great NTSC looks bad Far more peculiarities to deal with than an ordinary TV

11. MD-TV Challenges Form factor/Cosmetics Viewing angle Brightness-contrast Lamp lifetime RPTV perceptions and awareness 3 microdisplay technologies Aggressive PDP-TV price downs Massive LCD-TV capacity investment

12. Home Front Projection Challenges Wide range in prices and quality of projectors – $1,300 to $13K – Potentially best $/screen size value Complicated system – Projector, screen, accessories Needs installation – Who will do this? Consumers need education – Who will do it? Requires significant floor space to sell it – Only acceptable for big margins

13. PDP-TV Challenges PDP-TV prices have come down ~30% in 2004 – Driven a surge in sales – Reductions continuing (25-30% for 2005 likely) Challenging profitability – Fujitsu sells to Hitachi – Some de-emphasizing PDP-TVs – others increasing promotion – Samsung SDI reports profitability problems for Q2 – LG backing off aggressive pricing plans Consolidation in manufacturing base probably coming

14. LCD-TV Challenges Gen 6 and Gen 7 fabs will bring enormous capacity online in 2005 – $2B investments – Need to push panels into market – History of cycles of over supply and rapid price declines If demand is not strong, cash flow problems develop, more price reductions to stimulate demand – Could see prolonged periods of losses Push to 40” and 50” LCD-TVs coming sooner than expected

15. The 42” Battle 40-44” DLP RPTV 40-44” 3LCD RPTV 42” EDTV PDP 42-43” HDTV PDP 40-42” HDTV LCD 1Q2005 4Q2004 Source: PMA March 2005 FPD & RPTV Tracking Services

16. Crushing Price Reductions RPTV price to drop by 18% from 2004 LCD price to drop by 40% PDP price to drop and 25% Margins will be squeezed at retail New business models will develop Some will loose money

17. MCG Optimistic Forecast

18. Forecast vs. Actuals (2004/2005)

19. MD-TV Forecast

20. MD-TV Realities Many are giving up on the 40-49” size range abandoning to PDP Many are lowering forecasts for MD-TV in 2005 CRT-RPTV is hanging on longer than expected

21. MD-TV Options Vertically integrate to reduce margin stacks from many components and assemblies Offer more aggressive pricing in 42” segment to stop PDP – $1,000 DLP-RPTV planned for 2006, but need to survive 2005 – Buy market share buy lowering prices with loss leader product

22. TV Prospects Everyone forecasting the big-screen TV segment grows much bigger – Requires a shift in consumer spending MD-RPTVs in the middle of very dynamic market turmoil – Addressing most challenges, but unclear how all will play out LCD and PDP have the momentum in sales volume Who wins? – Consumers Who looses? – Almost everyone else

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26. DTC Forecast

27. US TV Size Trends (3MPO)

28. TV Market Size Total number of TVs WW in 2005 = 170M to 200M – Could grow to 215M by 2009