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Mobile TV to cars – the original offer

August 2009

© 2009 RaySat Broadcasting Corporation. All rights reserved. AT&T and the AT&T logo are property of AT&T Intellectual Property

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Introduction

AT&T CruiseCastSM – Live satellite TV for mobile consumers

• Designed for passengers in: cars, SUVs, trucks, RVs, boats

• Live television, the #1 form of media, joins phone, text and Internet in the car

Direct-to-Car satellite television (“DTC”) greatly expands the satellite TV market

• 30 million home satellite installs → new target installs: 250 million vehicles

Nationwide service launched June 2009, scalable, operational mass-market infrastructure

• Utilizes innovative proprietary technologies well positioned to be adapted by auto OEMs

• Used only $30 million to create a fully operational, national television service

Exclusively provided by RaySat Broadcasting Corporation

• Founded in July 2007: AT&T, Inc. and RaySat, Inc., a provider of in-motion antennas

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Investment highlights

Fully operational service, adding initial subscribers, commencing marketing activities

Unique technology addresses aftermarket and OEM requirements

AT&T partnership, brand and marketing power

Highest quality video and largest selection of content vs. expected competition

Unlimited expansion capabilities (content, services)

Clear distribution strategy with large base of existing partners

Leadership team of industry veterans from satellite and mobile content companies

1st mover in the massive addressable market for in-vehicle satellite television service

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In-vehicle: the largest untapped TV market

McKinsey & Co. study highlight:

• 66% of current /likely RSE users see AT&T CruiseCast as favorable

• 38% would buy service

• DoT estimates 25mm RSEs in 2009

Frost & Sullivan study highlight:

• 55% of respondents “interested” in live TV for their vehicle

• Includes 23% of respondents that are “very interested”

AT&T and RBC commissioned 2 comprehensive studies, both indicate market demand

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AT&T CruiseCast – The Service

Replicating the “at-home” television experience to maximize customer acceptance

• 22 premium channels of live television covering all age groups and interests

• Standard program guide and RF remote control

• 20 channels of satellite radio

• One package currently available: $28 per month, discounts for 1 or 3 year plans

• Subscribers purchase the AT&T CruiseCast viewing system, current MSRP $1,299, target $999 in early 2010

Kids, Tweens

& Teens

Family &

Entertainment

News &

Weather Sports

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How we do it…

Operate our own private broadcasting network

• Teleport and headend located at Intelsat’s world-class Mountainside, MD facility

• Lease transponders on geo-stationary satellites

• Aggregate content from premium providers

• Broadcast nationwide signal optimized for Direct-to-Car service

Supply proprietary in-vehicle television systems (receiver and antenna)

• Training and support of car dealerships and 12-Volt installers

• Simple 1 hour installation process

Manage provisioning and customer service

• Mass-market ready provisioning system, 6 months of trial and testing

• Supported by Synchronoss, provides same functionality for AT&T’s iPhone service and Oracle ERP system

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Service activation

1 Customer signs up online, or calls 866-

800-9030 to provide personal information,

credit card info, and programming

features desired.

2 Installer completes installation

of antenna and receiver in

vehicle and calls 866-410-4437.

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and the contact phone number used by

the customer for service sign-up.

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The contact

phone number is

used to look up

the customer and

determine which

channels they

have ordered.

NDS CA Headend

(ECMG)

NDS

Signature

Server

Mountainside, MD

5 ECMG & MUX encrypt A/V content (with help of

Signature Server) for uplink to the satellite.

Provides Fiat-Shamir

public key proof of

authenticity to the SIM.

6 Entitlements (EMMs) addressed

customer’s unique SIM card are

broadcast on every satellite

transponder. The EMMs identify

which programming the

subscriber is entitled to watch.

7 Receiver gets the EMMs and the SIM

ignores all packets not uniquely addressed

to it. It stores entitlements (programming

rights) defined for the user.

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Installer enters user ID and PIN

(received upon passing online

certification test), then enters

the STB ID, SIM Card ID,

The subscriber system has now been

activated over the air minutes after

installation is complete!

Harmonic MUX CruiseCast Receiver w/ ST 5202

SIM Card

SIM card and main

chip in receiver are

“paired” when

device is added so

communications

over the internal

bus is encrypted.

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Competitive advantage: The Technology

Our industry-changing Ku-band micro-antennas

• Traditional Direct-to-Home satellite antennas: useless in mobile environment

• Existing vehicle antennas: too large (36”, ~50 lbs.), expensive ($3,000 to $4,000 installed)

Solution: MMIC chips (Monolithic Microwave Integrated Circuits)

Results: the T7 Micro-Antenna

Small form factor - horizontal design, 4” high x 9” diameter

Low manufacturing costs

Signal reception across the continental United States

Virtually unlimited bandwidth capabilities for new content

…and, the OEM T9 Micro-Antenna

Same high quality video reception and nationwide coverage

Only 0.5” high x 7.5” length, can fit inside rooftops and spoilers

Current R&D targeting manufacturing cost reductions

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Competitive advantage: The Technology (cont’d)

Our in-vehicle receiver (the “set-top box”) brings the living room experience to the car

• Full program guide, RF remote in the car: the most comfortable mobile environment

• Compact 8” x 6” form factor fits easily in trunk or under a seat

Patent-pending interleaving transmission protocol and buffer in the receiver allows service continuity (2 mins.) when the antenna loses line-of-sight with the satellite

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Comparison of other in-vehicle technologies

ATSC “free-to-air” digital video broadcasting for local market television content

Portable cache and carry video content

SERVICE DESCRIPTION ISSUES

MediaFLO USA

Sirius Backseat TV

ICO Global Comm.

• Uses 6 MHz of 700 MHz band spectrum, wholesales to mobile operators

• 2008 announced in-vehicle plans

• Three channels of kids TV

• Second antenna/receiver]required

• DVB-SH mobile video service, announced commercial launch in 2009

• 10 – 15 premium channels

• Optimized for phones, not 10” displays

• ~25 channels maximum (lack spectrum)

• Terrestrial network, major markets only

• Low video bit-rate (~200 kbps)

• Limited to 3 kids channels

• 20 MHz of 2 GHz S-band spectrum (cannot scale to more channels)

• Expensive infrastructure (G1 satellite + costly terrestrial repeater network)

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Marketing and distribution

Core initial marketing channel: Aftermarket through car dealers and 12-volt retailers

• Over 700 car dealerships and 12-volt retailers, growing every day

• Aftermarket needs value-add product to replace commoditized satellite radio and GPS

• Big-box electronics retailers are next

Exciting marketing agreements completed, launching today and in Q3 2009

• Crutchfield catalog summer issue: 3 million audience

• AT&T U-verse catalog: 7.4 million audience

• AVIS/Budget Group: 50 units in select markets, targeting 1,000 by year-end

Every aspect of the business has been coordinated to produce the OEM solution

Currently in discussions / testing with:

• Mercedes Benz, BMW, Ford, GM and Audi/VW

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AT&T co-marketing

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Sample marketing literature

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Research and development in progress

Embedded antenna for the OEM market

Size reduction advancements for the T7 roof mount antenna

Cost reduction advancements for both the antennas and the receiver (set top box)

New service offerings

• Location-based mapping and advertising

• GPS traffic and weather

• Two-way vehicle diagnostics and trouble resolution

Future 2-way capabilities in the form of terrestrial (AT&T 3G resell) and satellite

Premium movie content

Satellite TV On Wheels: Ku versus Ka

• Ku band advantages: • Continent coverage

• Single teleport

• Lower rain fade (broadcast – ACM does not work)

• BUT: 2 TV channels for 47 dbW transponders (25 cm antenna)

• Ka band advantages • Regional, country by country coverage (focused service)

• Local channels (per country or big city)

• Rev share model for an operator

• Stronger EIRP = smaller antennas

• For 10% of the capacity, 25cm antenna, an operator can have 20-30 multiplexed SD channels

• In the future - Single antenna for Broadband and TV

Proprietary and Confidential

SatixFy Catniss ASIC • Catniss is a full DVB S2/X implementation

• Symbol rates – 100Ksps to 500Msps

• Full blockage protection STB on chip

• Full mobile antenna controller (gyro, motor controllers)

• Capable of 1-way (mobile TV, Satellite Radio) or 2-way

• Enable a single chip antenna controller/STB implementation

• Ka , Ku, C and L-band support

• Initial production chips in Q3 2014

The “New” versus the “Old”

Self installed

Proprietary and Confidential

Automotive infotainment offering Go-To-Market strategy

Product offering

• Self installed Mobile TV • Equipment cost to channels - $199 • Equipment cost to end users at POS - $299 • Service fee (20 TV channels) -$9.95 or $14.95 (or $499 with 2 year of service)

Go-To-Market

• Aftermarket • National distributor • 12V retail – Mom & Pop; CAR Toys • New car dealers – High End

• OEM • High End SUV – GM900: Escalade; Yukon; Denali; Suburban; Tahoe • RV Companies • Maritime

Year 5 Year 4 Year 3 Year 2 Year 1 Quantities

300,000 200,000 100,000 25,000 5,000 Aftermarket

250,000 50,000 OEM

Proprietary and Confidential

10 Mbps

Example: Satellite TV on Wheels in Middle East

10% of beam EIRP

G/T = +3 db/˚k

Size = 25 cm

Proprietary and Confidential

1 Mbps

#3: Satellite Radio Example: Satellite Radio in Europe

10% of beam EIRP

G/T = -3 : -5 db/˚k

Size = 8-10 cm

Modulator

Modulator

Modulator

1 stream = 10% of SuperStream™ time slots

Different languages in different countries

Proprietary and Confidential

Low cost Satellite Radio

• Integrated Mobile Radio : • Low cost <$75 • BT/FM wireless transmission to Car

Radio

• Powered from Car Battery

Item Cost

Ant +Assembly 15

LNB 7

Rec Chain 6.1

Ka Modem 14.8

RF/BT/sensors 7

Power circuits + others 11.6

Production(15%) 9.2

Total off factory 70.7 Proprietary and Confidential

Satellite Radio – Satellite provider view

• Aftermarket and later OEM

• 1 Mbps = 30-40 radio channels

• €100 for the equipment, €5 a month

• As alternative, €199 for the product and 2 years of service

• IF we could reach a market size of 1M in a country like France or

Germany – and the satellite operator gets 10%, potential of getting

€20M for 2 years out of 10% of 8 beams. Lucrative.

Proprietary and Confidential

#4 : Mobile Broadband Motivation

• Full broadband coverage, in motion: Cellular and satellite

(when no adequate cell coverage)

• Single bill from, say, T-mobile or sprint: $10/GB (Current price)

• Safety and security (OnStar coverage issue)

• Possible bundle with mobile TV

• Vertical markets: RV, Boats, Limo, trucks

• Next generation: Consumer offering (3-5 years)

• Requires low cost COTM antenna integrated with BUC and Modem

with satellite/cellular operation

Proprietary and Confidential

Example: Mobile Broadband in the US The Concept

100 Mbps – Full rate

10% of EIRP

G/T = +5 db/˚k

Size = 40 cm To car audio system

Mobile terminal W ATSC/MH

ASIC Mobile BB

Mobile TV Sat radio

Tx Path

Rx Path

WiFi HSPA 3G/4G

module

Cellular antenna

Car CPU/IP system

Flash

DDR

Proprietary and Confidential

Summary

• Interesting market pursued by 10 companies in the last decade

• Each one had it’s own advantages and disadvantages

• Big market waiting to be pursued

• “Satellite TV on Wheels” book

• Expect next attack in 2014/2015…