State of the Internet: Global Perspectives & the Role of Turkey in the Digital World

Google Day - Istanbul, Turkey

Jack Flanagan, EVP, comScore, Inc.
November 17, 2009

Agenda comScore Overview
– Who we are and what we do

Global Context
– Online trends by country & region – Usage intensity, top categories

Turkey: In Focus
– Usage Intensity – Penetration of Online Categories – Demographic Composition – Social Networking – News and Information

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comScore Overview

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comScore Is The Leader In Online Measurement
We are the largest provider of digital marketing intelligence, using a platform that helps our customers make better-informed business decisions and implement more effective digital business strategies We measure the continuous online activity of 2 million people globally who have granted us explicit permission to confidentially measure their Internet usage patterns Our products and solutions provide our customers deep insights into consumer behaviour, both online and offline

360°View of Consumer Behaviour °
Web Visiting and Viewing

Demographics Life Stages

Online Transactions

Streaming Video

Search Behaviour

Media Exposure

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Recognized For Outstanding Growth And Innovation

2007 Technology Pioneer
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Fastest Growing Global Research Firm
comScore is currently the fastestgrowing firm in the prestigious Honomichl Global Top 25 report, ranked as the 20th largest global research firm August 2008

High Tech Award
Recognized as a technology leader for successfully developing innovative products. November 2004

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comScore was identified by Inc. Magazine as one of the fastestgrowing private companies in the U.S. from 2003 to 2006 September 2007

World’s Largest Database
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Deloitte 2008 Technology Fast 500
comScore recognised amongst the Deloitte 2008 Technology Fast 500 November 2008
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Top 100 Innovative Companies
Named one of the 100 companies that will shape the next year in technology. December 2004

1,200+ Clients Worldwide Some of our European & Turkish customers

Agencies

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Data collected from more than 2M panelists in over 170 countries

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Almost 40 countries reported on each month

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Global Context

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The US is No Longer the Center of the Online Universe
US Internet Population vs. Rest of the World

Distribution of Worldwide Internet Audience

Rest of the World

Europe

North America Latin America Middle East - Africa

US

Asia Pacific

In 1996, 2/3 of the world’s Internet population was in the US, yet today Asia Pacific is the largest region. Many emerging regions are likely to bypass old modes, skipping dial-up to go straight to broadband, making multimedia, video, and collaborative content immediately accessible. Early adoption of mobile web in addition to PC web will likely be popular in many of these high-growth areas.
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Source: comScore World Metrix, July 2009

Europe Continues Audience Growth
Growth is flat in North America European growth mostly driven by Russia Asia continues rapid growth on a very large base Growth in LatAm expected to continue on the back of increased residential broadband penetration region-wide
August 2008 August 2009

Worldwide Online Population (Millions)
+4%

1,165.2 960.2

+22%
477.2 389.6

Online Population by Region (Millions)
+20%
325.6 271.1

Aug 2008 Aug 2009

+4%
183.8 191.0

+28%
70.3 90.2

+79%
45.4 81.2

Asia Pacific

Europe

North America

Latin America

Middle East - Africa

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Source: comScore Media Metrix, August 2008 to August 2009

China Surges Past the US

Internet Users Age 15+ (MM)

While US user growth has remained flat over the past year, China, Russia, and Brazil have experienced impressive growth rates of 31%, 26% and 23%, respectively.

Millions of Internet Users (15+, home & work locations)

Source: comScore World Metrix, July 2009
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Online Engagement by Country
Average Hours Per Visitor Per Month
Canada United States Turkey Israel United Kingdom Mexico South Korea France Venezuela Netherlands Chile Colombia Spain Brazil Sweden

43.1 32.5 29.7 29.5 28.5 28.3 27.9 27.2 26.6 26.4 25.2 25.1 25.0 24.9 24.6

Canada is the most engaged country, followed by the US, both of which increased time online over the past year (Canada +7%, US +17%)

Source: comScore World Metrix, July 2009
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The Majority of Top Properties’ Audiences Coming from Outside US
US Audience Non-US Audience 84% 84% 77% 77% 81% 66% 73% 70% 76% 64% 295 268 237 197 196 192
Source: comScore World Metrix, July 2009
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Total Worldwide Unique Visitors (MM) 854 702 592

370

The top 10 Global Properties attract a majority of Unique Visitors from outside the US; Google Sites and Microsoft Sites attain 84% of their audience from non-US countries. All top sites have experienced a shift in visitor composition to a more international audience: non-US visitors now represent 77% and 66% of Facebook’s and AOL’s visitors, respectively.

Extended Universe Reporting Is Important in Developing Markets: Usage Driven by Locations Outside of Home & Work
The Extended Universe has the most impact in Brazil, where over 50% of the online population is outside of the ‘aged 15+, online from home or work’ definition India has considerable room for growth; currently only 7% of the population aged 15+ is online Internet Penetration
30.8% 350,000 300,000 109,948 250,000 200,000 150,000 100,000 50,000 0 China 220,834 7.0% 28.9% 20,170 35,810 India 34,711 Russian Federation 48.1% 51.3% 38,111 31,933 Brazil 8,937 19,745 Turkey Extended Universe Additions comScore Defined Universe

Reach of Extended Universe

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Source: comScore World Metrix, September 2009, and CIA population estimates

Global Search Market Thriving
Online Searches (bn) by Country August 2008 – August 2009
August 2008 United States China Japan United Kingdom France Germany Korea Canada Brazil Turkey Russian Federation India Italy Spain Mexico 3.5 3.4 3.3 2.7 2.5 2.5 2.5 2.1 2.0 5.7 5.0 4.6 7.9 11.5 August 2009 21.8

A total of 117.3 billion online searches were conducted globally in August 2009 – 42% more than in August 2008 81.4% of these searches were carried out outside of the US More searches are conducted in Turkey than in Italy or Spain, despite having a smaller online population

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Source: comScore qSearch, August 2009

Google Dominates Search in Turkey, But Not Everywhere
Google dominates many search markets, especially where there is no established local alternative; in Turkey, 98% of search engine searches are conducted on Google However, Yandex accounts for over half of search engine searches in Russia, and Baidu is the clear search leader in China Share of Search Engine Searches
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Turkey Brazil India United Kingdom Russian Federation China 34% 15% 98% 55%

Baidu 72% Yandex Google

94%

92%

87%

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Source: comScore qSearch, August 2009

Users In Less Developed Markets Are Less Active Online
Average time spent online is an indicator of the state of development of internet markets, and Turkish users spending more time online than UK users shows the Turkish market to be highly developed The average user in Turkey is online for over 31 hours per month, compared to 11 hours in India Average Time Spent and Pages Viewed per Unique Visitor per Month
3,500 3,000 2,500 2,000 1,500 1,000 500 0 Turkey United Kingdom Brazil China Russian Federation India

Time Spent (mins)

Pages Viewed

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Source: comScore World Metrix, September 2009

Heavy Users Most Visible In Developing Markets
In all of the largest developing markets, heavy internet users account for a higher volume of total pages than in the UK Russia has the highest page consumption disparity, with 73% of pages viewed by 20% of the population Share of Page Views by User Segment

100% 80% 57% 60% 40% 34% 20% 0% 9% United Kingdom 11% Turkey 11% China 31% 30% 30% 10% Brazil 24% 7% India 57% 59% 60% 69% 73% Heavy Users Medium Users Light Users

23% 4% Russian Federation

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Source: comScore World Metrix, August 2009

Turkey: In Focus

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Profile of the Internet Audience in Turkey
Internet users in Turkey skew young: nearly 40% of the Internet audience is under the age of 24, and nearly 70 percent are under the age of 34 In comparison, only 54 percent of the global online population is under 34
Distribution of Internet Users 15+

Turkey

38%

31%

18%

10% 3%

Europe

26%

23%

21%

16%

14%

Worldwide

28%

26%
20% 30% Persons: 25-34 40% 50% 60%

22%
70%

14%
80% Persons: 55+ 90%

10%
100%

0%

10%

Persons: 15-24

Persons: 35-44

Persons: 45-54

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Source: comScore Media Metrix, September 2009

Top Properties in Turkey
Google ranks as #1 property in Turkey
– 18.3 million unique visitors, 93% reach

40% of top properties are US sites Dogan Online top Turkish property with 11.1 million unique visitors
Total Internet 1 Google Sites 2 Microsoft Sites 3 FACEBOOK.COM 4 Dogan Online 5 Milliyet Group 6 Mynet A.S. 7 BLOGCU.COM 8 Hurriyet Internet Group 9 Nokta Internet Teknolojileri 10 Yahoo! Sites Total Unique Visitors* (000) 19,745 18,361 17,597 16,050 11,148 8,785 8,321 8,239 7,471 7,072 6,448 % Reach 100.0 93.0 89.1 81.3 56.5 44.5 42.1 41.7 37.8 35.8 32.7

* Persons 15+ Home & Work – does not include shared internet access
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High Category Penetrations are Further Evidence of Turkish Development
The penetrations of key categories in Turkey are closest to those in the UK Turkey is the country with the highest category penetration in 5 of the 8 categories selected, with significantly higher reach for the News/Information and Games categories

Selected Categories Search/Navigation Conversational Media Entertainment Retail Multimedia News/Information Games Sports

Turkey 92% 89% 83% 61% 75% 76% 68% 48%

United Kingdom 91% 90% 86% 76% 72% 67% 57% 44%

Brazil 79% 79% 74% 62% 61% 56% 50% 40%

China 66% 52% 64% 50% 51% 50% 49% 22%

India 72% 71% 66% 40% 49% 43% 28% 22%

Russian Federation 64% 65% 65% 42% 50% 46% 44% 14%

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Source: comScore World Metrix, September 2009

But Demographic Composition Shows Turkey’s Online Development to be Incomplete
Young males are typically the earliest adopters in emerging internet markets and digital platforms The strong presence of these early adopters in Turkey – 71% of users are aged 15-34 and 58% are male – implies that there is still room for further advancement Percentage Composition of Unique Visitors by Age

UK
19 21
15-24 25-34 35-44

Turkey
10 3

18

40

19

19

45-54 55+

21

31

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Source: comScore World Metrix, September 2009

Facebook Leads Turkish Social Networking, but Less Developed Markets Prefer Local Players
The surge of Social Networking giant Facebook - accessed by 81% of the Turkish online population – has not been a truly global phenomenon. Of the 214 million people 15+ online in Brazil, Russia, India and China, only 5.7% visited the site in September China has a particularly fragmented Social Networking market, still in it’s infancy, where Facebook reaches only 0.1% of the online population Social Networking Share of Total Pages
50% 40% 30% 20% 10% 0% 43%
Turkey Country Leading Social Network Reach 81.3% 74.1% 71.5% 46.8% 44.0% 24.0%

40%
United Kingdom

20%

19%

18%

12%

Brazil Russian Federation India China

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Source: comScore World Metrix, September 2009

Online A Major Platform for News & Information Content in Turkey
While half (25.4m) of the UK population 15+ visited a site in the News and Information category in August, the 109 million who did so in China makes up only 10% of the Chinese population 15+ In Turkey, 76% of the online population and 27% of the total population 15+ access News/Information sites – almost as many individuals as in India
Total Population 15+ Reach of News/Information Sites 26.9% 49.9% 12.3% 10.2% 13.3% 1.9%

Countries

Online Reach of News/Information Sites 76.0% 68.1% 56.2% 49.6% 46.2% 42.8%

Unique Visitors to News/Information Site 15,016 25,387 17,948 109,480 16,025 15,339

Turkey United Kingdom Brazil China Russian Federation India

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Source: comScore World Metrix, September 2009

Top News & Information sites in Turkey
76% of the Turkey online population visited News & Information web sites
– 15 million unique visitors

Milliyet.com.tr ranked as the number 1 site in the category with 8 million unique visitors
Unique Visitors
News/Information MILLIYET.COM.TR HURRIYET.COM.TR Mynet News HABERLER.COM Ekolay News TUMGAZETELER.COM HABERTURK.COM SABAH.COM.TR NTVMSNBC.COM ENSONHABER.COM 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000

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Summary
Internet growth will continue to come from outside the US
– Asia Pacific best poised for continued growth

Extended universes very important in developing markets
– More than 50% in some markets (i.e. Brazil, China, India)

Turkey shares many characteristics with the most developed internet markets;
– Strong presence of Search and key categories – Dominance of Western supersites (Google, Facebook) – High usage intensity of those online and visibility of ‘lighter’ internet users

But there are signs that there is still ground to make up
– Internet penetration lower than Western European – Current high rate of growth in internet users – Demographic composition characterised by early adopters and young users

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Thank You

jflanagan@comscore.com

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