1. Group Strategy Division | 2010 MRP Business Strategy Department Group Strategy Division February 17th, 2011 1 SPE Starz Netflix Current SPE – Starz relationship ・ License SPE Contents exclusively - 220 titles (Pay1: 57, Pay 2: 3, Library 160) - for 11 years from CY2005 to CY2016 - to Pay 1 and Pay 2 periods [*1] ・ Receive approx. 400M$ fees/year from FY13. ・ Obtain most favorable terms of Starz linear Pay TV or subscription on-demand channel on Sony internet platforms ・ Bundle 2 “free on demand” titles per year with purchase of Sony products (>$100) ・ Right for Sony/SPE to exhibit 6 titles (<$50m DBO) per year on our mobile linear Pay TV channels ・ Sub-distribution deal to allow Starz to offer SPE contents to Netflix ・ 220 titles licensed to Starz and 107 catalog features [*2] from SPE, out of 8,500. [*1] two 13-18 month periods, the first starting 7-10 months post theatrical, the second starting 8-8.5 years post theatrical via linear subscription pay television (cable, satellite) and subscription video-on-demand (cable, satellite, internet) [*2] For watch instantly streaming service only 11 Source: RIAA data 1996–2008; Needham & Co LLC estimates for 2009 B$ ・ Any risks? eg) Netflix grows into a dominant platform giant to control price? - music industry radically shrunk due to the advent of itunes Decrease of physical sales (CD)

2. Group Strategy Division | 2010 MRP Business Strategy Department Group Strategy Division February 17th, 2011 2 Netflix aspirations may threaten Qriocity service *1: Source from Netflix Strategy Deck, May 2010. *2: At 1/8/11 dinner, Netflix VP of Business Development told D. Benefield (SNEI) and N. Colsey (HEoA) *3; At 1/8/11 meeting, Netflix CEO told Bob Ishida and Tim Schaaff We expect Netflix to have more than 19 million subscribers by the end of 2010, representing about 6% of the U.S. population or 17% of the estimated 116 million U.S. TV households. Netflix is not far from surpassing Comcast subscriber base of 23 million cable subscribers. This would make Netflix the US leader in “pay TV”, ahead of players like Dish, DirecTV and Time Warner Cable.ComcastDishDirecTVTime Warner Cable Netflix’s management has stated that for most of its subscribers, streaming minutes are now exceeding DVD minutes when it comes to viewing the content. No challenge to create early release windows [*1] - New release window is not available for Netflix since studios wish to preserve current sell-thru/ rental - Avoid pay-per-view, ad-supported, sports, news, adult, UGC Intend to introduce lower price from $7.99/mth to $4.99 [*2] - Netflix will continue to increase the amount of content they offer AND reduce the price. - Cost of content is fixed, so the more subscribers they have, the lower they can price the service. They would like to be at $4.99/month (currently $7.99/mth) Aim to take current business model global [*3] - Already launched in Canada in fall 2010 - Will launch in Latin region in Fall 2011 (starting with Mexico and Brazil) - Will launch in Europe in 2012 Netflix is gaining customer touch points in Living Room TV equal to “Pay TV” Will further grow in US with lower pricing and expand similar model globally Analyst Comments Aspiration of Netflix

3. Group Strategy Division | 2010 MRP Business Strategy Department Group Strategy Division February 17th, 2011 3 Theatrical Hotel & Airline DVD and Blu-Ray Disc Sell-through Standard PPV/VOD Pay 1 (HBO, Starz, SHOW, EPIX) Pay 2 (HBO, Starz, SHOW, EPIX) Broadcast/Cable (F/X, TNT, USA, AMC) EST (Starz Studios) EST (HBO Studios) +2 Months +4 Months +5 Months +8-8.5 Years 0 Days Generally +8 Months (1) Early Window Day & Date PPV/VOD EST (HBO Studios) EST (HBO Studios) Broadcast/Cable (F/X, TNT, USA, AMC) Library PPV/VOD Library PPV/VOD Library SVOD (NFLX)/ FOD (Hulu) +2-2.5 Years Proposed New Window by Qriocity Subscription Disc Rental (Netflix) / Kiosk Rental (Redbox) A subset of titles avail. day & date Pay 1 SVOD* (Starz/EPIX w/NFLX, HBO GO) Pay 2 SVOD* (Starz/EPIX w/NFLX, HBO GO) SVOD (F/X, TNT, USA, AMC) Physical Rental/ Sell-through/EST PPV/VOD Linear TV SVOD/FOD * In order for Netflix to get an earlier window, they must either buy-out the Pay window or carry another pay service (Starz, HBO, EPIX or Showtime) (1) Pay 1 commences the earlier of 10 months from general theatrical, 4.5 months from initial home entertainment street, and 3.5 from PPV/VOD. It is feasible for Pay 1 to commence as early as 6.5 months post theatrical (assuming day-and-date VOD at 3 months post theatrical), but this is still an infrequent scenario. Netflix does not provide streaming content in “Broadcast/Cable” window; from 2-2.5 years to 8-8.5 years Qriocity service can offer EST starting with the new release window and continuing indefinitely with the exception of films from HBO studios (Time Warner, Fox and Universal) blocked out in Pay 1 and Pay 2. All VOD is blocked out during Pay 1 and Pay 2 Windows for TV series differ from windows for feature films QriocityNetflix Starz -Netflix Comparison of Release Windows 22

4. Group Strategy Division | 2010 MRP Business Strategy Department Group Strategy Division February 17th, 2011 4 Fact Finding: Netflix has acquired 20 million DVD rental and streaming subscribers through 2010, invested over $400MM in streaming rights in 2010, and committed to spend over $1BN on additional streaming rights in the future in order to become a major platform in the U.S. –17% of the estimated 116 million U.S. TV households –Not far from surpassing Comcast, the largest U.S. cable provider, subscriber base of 23 million cable subscribers –Becoming a U.S. leader in “subscription video services”, with more subscribers than other providers such as Dish, DirecTV, Time Warner Cable, etc. –Netflix provides content to multiple-devices, enabling one-content/multi-device UX Qriocity online video service puts strategic focus on transactional models (EST, VOD) in new release windows, while Netflix offers subscription via an online service (different windows, different business models) However, Netflix’s DVD-by-mail service offers films available in the new release window (Qriocity and Netflix compete in the same window, but with different models) Bounty fees from HE Devices contributes positively but its volume is limited, so is referral fees via Internet TV. SCEA receives approx. $10 Mil flat fee from Netflix in exchange for putting Netflix icon on PSN embedded in PS3. Key Implications: Unlimited expansion of Netflix to take price control power is unfavorable Qriocity video service alone is unlikely to compete head-to-head against Netflix in terms of scale given Netflix’s first mover advantage, brand recognition and required investment Need to further clarify unique value proposition of Qriocity video service Fact-findings Summary & Key Implications H/W Device Network Service ContentContent Pros Cons Drive H/W sales through improved brand and ease of use with Netflix More bounty fees (limited) Enrich 3 rd party offerings on Qriocity platform Cannibalize in catalog sales Shift customers to 3 rd party services within Qriocity Potential to earn sizable licensing fees from Starz if Starz extends Netflix relationship with acceptable terms Netflix may acquire dominant platform position in industry