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AFI'S DIGITAL CONTENT FESTIVAL

The Year’s Best iTV, Wireless and Broadband Entertainment

Visit www.AFI.com/dcl to register

Don't miss the opportunity to see the year's best digitally deployed programming.

Creative as presented by the creators themselves.

Presenters include:



Lucy Hood, SVP of content and marketing at News Corp.;

Jason Hirschhorn, SVP of digital music and media at MTV Networks;

Michael Goldstein, project manager for interactive programming at

EchoStar;

Robert Chua, founder of The Interactive Channel;

Christopher Lucas, VP/Ex. Producer of digital media at Showtime

Networks;

Paul Marcum, GM of Sesame Workshop Interactive Media Group;and

Robert Tercek of (M)FORMA).

Jonathan Miller, chairman and CEO of America Online;

Roma Khanna, SVP of content at ChumTV;

Philip Jay, BBC;

Fred McIntyre, VP of video at AOL Music on Demand;

Mugs Buckley, interactive sales manager at Comcast Spotlight; and

Dave Whetstone, chief marketing officer at Idetic





"AFI Digital Content Festival"

(Speech Notes for 20th July, 2005, Los Angeles)

After spending 41 years in the TV industry my experience tells me that 'cross-

media interactive' TV channel is the way to go and that is what viewers would

come to expect from future TV channels. Embracing that vision, I have

developed the world's first 'cross-media' interactive TV Channel called TIC ("The

Interactive Channel").

What do I mean by 'cross-media' interactive TV? Essentially, all the 'live' TV

programs are integrated with the Internet and Mobile phones and are simulcast

on the Internet. In Hong Kong TIC airs as an IPTV show and on Cable TV to over

three-quarter million Pay TV households. To give you some perspective, China

generated an average of over 18 billion SMS messages each month last year.

I believe 'cross-media interactive TV' channel will one day replace many

'traditional TV' channel. I am not saying that 'Passive TV' will die as they

predicted of Radio when TV first started because not all TV programs need to be

'interactive'. 'Passive TV' has its place when offering viewers Movies, Sitcom and

TV Dramas. These are best to be left alone to be viewed and appreciated without

any need for interactive participation. In my opinion, Interactive TV is best suited

to 'live' shows such as Current Affairs/Talk shows, Quiz/Game, Music, Sports,

Teaching/Training, Home Shopping/Auction, Dating shows, etc and even pre-

recorded programs like documentaries that end with a 'live' Show to follow-up on

the documentary's topic. (eg: "iHappy Hour", "iFriends", "iSuperMarket", etc)

But, what is appealing and interesting, is that 'Cross-Media' interactive TV allows

the viewers to be interactive. In 'cross-media interactive' TV, for example,

viewers with Internet access and Home/Mobile phones are able to interact with

each other while being seen simultaneously over TV and Internet. TIC's

viewers do not need the use of 'Set-Top Box' to participate in any of its shows,

and only while watching TIC can viewers interact with other viewers of the show

via the Internet and 3G Mobile phones. The 'cross-media' interactive TV

experience is unique and stands out.

# POWER POINT SLIDES

Definition of 'Cross-Media'

A 'Cross-Media' program showcases communications from different

technology platforms at the same time.

In 'Multi-Media' a program often runs independently in different forms or

versions over only one platform and often at different time without integration of

all platforms and is not shown simultaneously over multiple platforms.

As an example of Multi-Media program, I have a 'Java' and '3G' version of

"Everyone Wins" a TV Quiz/Game show that I had created that is currently airing

on terrestrial TV and because it is not integrated it must run independently so

that is just a TV Game Show. This becomes a 'multi-media' play and not 'cross-

media' play. (eg: how 'Everyone Wins' Java and 3G Quiz/Game works)

In 'Cross-Media' a program is integrated to run simultaneously over multiple

platforms on TV, Internet and Video/3G Phone. Internet users can watch and

participate from anywhere in the world to vote or send messages over the TV

Chatroom including the use of the Webcam. In addition Video phone and 3G

Mobile phone users can SMS or Call-In to the Shows to see themselves on TV.

Currently most interactive TV Shows and TV Games around the world need a

Set Top Box to participate. TIC does not use a Set Top Box but instead use

'Mobile phones' and 'Internet' to interact with its games and 'live' shows. Only

when the world finally settles on to one standardized STB system will TIC

develop shows that run over STB. I recall the early days before the world had

decided on VHS as the standardized home video recorder, there were VHS,

Betamax and Philip recorders. As we speak VHS is becoming obsolete in Asia

where many have moved to DVD instead of VHS tapes to record off-air TV

programs.

The future of merely casting votes in "American Idol" or "Big Brother" will not be

enough to attract viewers. TV shows that do not have the 'cross-media

interactive' features but simply the basic 'interactive' features such as 'voting' or

'text messaging' will not be good enough to successfully compete for viewers.

I would now like to play a video to show what TIC's 'cross-media' interactive TV is

like. You can see how we have successfully integrated 'Webcam' images, 'Video

phone' and '3G phone' to all TIC 's 'live' shows. After you see the video you will

all get a better understanding of what I am trying to present to you.





VIDEO





(90" TIC Promo and a video of one 'cross-media' interactive TV program)

As I mentioned earlier TIC operates without a set-top box and therefore 'red

button' is irrelevant for TIC. The fact that we do not need a set-top box is a

huge advantage for us as we can reach a much larger audience without the need

for viewers to purchase a set-top box to interact with TIC.

While traditional TV channels are chasing their share of advertising revenues

from the same pot, TIC has more than one revenue stream, and they are:





(1) 'Internet Advertising Dollars' by moving Internet Banner Ads

over to TIC Banner Ads and its Website.

(2) 'Mobile Operators' Revenues' from 'SMS' for playing TV

Games, Chat Room and Voting on 'live' Shows, 'Downloading Fee'

from ring tones, screen savers', Java games and fees from 'MMS'

including '3G' viewing.

(3) 'Viewers' Ad Dollars by moving Personal/Classified Print

Ads over to TIC Personal/Classified Banner Ads. (eg: Personal

Greetings Banner Ads, "iCelebrations", etc)

(4) 'Play Points' purchased for Internet use to participate in 'live'

Shows and ‘on-line’ games.

(5) 'Sales of Products/Services' revenue shares from 'Infomercial

Shows', 'TV Auctions' Shows and 'Pre-Paid Cards' for users to play

TIC 'On-Line Games'.



The potentials are only limited by our ability to create new formats and programs

where viewers can participate.

TV commercials aired over TIC can be more effective than those aired on

traditional TV because TIC's commercials are aired inside the 'live' Host screen

during all Program commercial breaks. Viewers are less likely to surf to other

channels during commercial breaks because their interest will remain on the TV

screen as the Chatroom and Voting remains active. TiVo cannot identify the

TIC's commercial breaks inside the Program Break but only between Programs

where commercials will be aired in full screen.

TIC's main assets are our ‘Brand Name’ TIC that is recognized as the world’s first

‘cross-media’ interactive TV Channel, our ‘cross-media’ program and technical

development experience, the ability to create 'cross-media' interactive TV

program formats and my Chinese television experience from being the first

media person in the world to enter China in early 1979. I secured sponsorship for

CCTV's first nightly 'Time Check' in 1980 and currently hold the record for

licensing the longest running TV Game Show format there, is still running day.

TIC will license the entire Channel as a turn-key operation to Channel Operators

or Content Providers to operate as a Cable TV or IPTV Channel. It could also be

as an enhancement to any channel's existing programs if one does not wish to

start their own 24 hours 'cross-media' interactive TV Channel. (eg. Thailand

Press Conference experience, expected first Licensee, multi-language text, etc)

Anyone having watched or taken part in any TIC's 'cross-media' interactive 'live'

shows will agree that TV viewing will never be the same again!



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