David PillsburyPresident, PGA TOUR Golf Course PropertiesPresident, PGA TOUR Golf Course Properties

PGA TOUR Fans &Growth of the GamePGA TOUR Fans &Growth of the Game

• Fan growth converting into growth of game Fan growth converting into growth of game

• Update on PGA TOUR fan growth initiativesUpdate on PGA TOUR fan growth initiatives

• Connecting PGA TOUR initiatives and Connecting PGA TOUR initiatives and industry initiatives to maximize number of industry initiatives to maximize number of fans and playersfans and players

Objectives of GOLF 20/20Objectives of GOLF 20/20

• Increase participationIncrease participation

• Increase rounds of golfIncrease rounds of golf

• Fan base expansionFan base expansion

Viewers vs. ParticipationViewers vs. Participation

Less than Less than once a once a monthmonth

Once a Once a monthmonth

2-3 times 2-3 times a montha month

Once a Once a weekweek

2+ 2+ times a times a weekweek

Viewed 1-5Viewed 1-5 256256 359359 335335 271271 193193Viewed 6-10Viewed 6-10 278278 380380 657657 882882 779779Viewed 11-20Viewed 11-20 250250 328328 728728 10091009 991991Viewed 21+Viewed 21+ 226226 446446 458458 874874 19271927

Source: MRI, Doublebase 2005

Low High

Low

High

Claimed Golf Participation

Cla

imed

T

OU

R V

iew

ers

Index vs. US Avg. (US Avg.=100)

Expand Breadth and DepthExpand Breadth and Depth

Core Golfers

Golfers

Fans

Changes for PGA TOUR FanChanges for PGA TOUR Fan

Current Fan ExperienceCurrent Fan Experience 20072007

No clearly-defined seasonNo clearly-defined season •New era in golfNew era in golf•True season with playoffsTrue season with playoffs•Energized fan baseEnergized fan base

Broadcast has become fixed Broadcast has become fixed and somewhat predictableand somewhat predictable

•New initiativesNew initiatives

•Broadcast strategiesBroadcast strategies

•HDTVHDTV

•Long term TV partnershipsLong term TV partnerships

Evolving media platformsEvolving media platforms •Ability to consume product Ability to consume product in the way fans want itin the way fans want it

Inconsistent tournamentInconsistent tournament

experienceexperience

•Consistent executionConsistent execution•Standards & best practicesStandards & best practices

Fan/Golfer LifecycleFan/Golfer Lifecycle

BuildAwareness

CreateConnection

Trial/Introduction

Golfer/Retention

PGA TOUR

FedExCup

PGA of America

USGA

Other Media

Broadcast

pgatour.com

pga.com

Local events

Play Golf America

Free Lesson Month

Corporate Golf

Link Up to Golf

The First Tee

Local Programs

Executive Women’s Golf

Golf Operators

Golf Professionals

Broadcast ConsumptionBroadcast Consumption

19961996

Primarily network broadcastPrimarily network broadcast •Expanded six year agreementExpanded six year agreement•Higher quality telecastsHigher quality telecasts

20072007

424 network hours424 network hours

Golf Channel in 7.4 M homesGolf Channel in 7.4 M homes

•538 network hours538 network hours

•Golf Channel in 70 M Golf Channel in 70 M homeshomes•Primetime replay of eventsPrimetime replay of events

Inherent Limitations of TVInherent Limitations of TV

• Less than 2% of tournament play Less than 2% of tournament play is on TVis on TV

• Airs only 25% of competitionAirs only 25% of competition

• Cannot cover all players/shotsCannot cover all players/shots

• Fan access to the broadcast not Fan access to the broadcast not always possiblealways possible

New Media LandscapeNew Media Landscape

• Broadband means increased consumption Broadband means increased consumption of Internet contentof Internet content

Broadband Driving Internet ConsumptionBroadband Driving Internet Consumption

Actual Projected

Mil

lion

s U

.S. H

ouse

hol

ds

0

10

20

30

40

50

60

70

80

90

2002 2003 2004 2005 2006 2007 2008

Actual Projected

Mil

lion

s U

.S. H

ouse

hol

ds

0

10

20

30

40

50

60

70

80

90

2002 2003 2004 2005 2006 2007 2008

U.S. Broadband Internet PenetrationInternet

Broadband

Source: Forrester Research 2005

40 Million US Households

New Media LandscapeNew Media Landscape

• Broadband means increased consumption Broadband means increased consumption of Internet contentof Internet content

• Media platforms are fragmenting and Media platforms are fragmenting and proliferatingproliferating

Time on InternetTime on Internet• Time spent on Time spent on

Internet has Internet has increased increased dramatically and is dramatically and is comparable to TVcomparable to TV

• Pressure on TV due Pressure on TV due to increased to increased fragmentation and fragmentation and DVRsDVRs

• Additional pressure Additional pressure on traditional media on traditional media sourcessources 0% 10% 20% 30% 40%

Magazine

Newspaper

Radio

TV

Internet

Note: Internet = Home + Work

U.S. Percentage Time Spent by Media

Source: Forrester Research 2005. Online consumers

New Media LandscapeNew Media Landscape

• Broadband means increased consumption Broadband means increased consumption of Internet contentof Internet content

• Media platforms are fragmenting and Media platforms are fragmenting and proliferatingproliferating

• Media consumption is changing; we are Media consumption is changing; we are moving to an on-demand content worldmoving to an on-demand content world

Mobile PhoneMobile Phone• 207 million wireless 207 million wireless

subscribers in USsubscribers in US

• 50 billion SMS 50 billion SMS messages in last 6 messages in last 6 months of 2005months of 2005– Up 50% YTYUp 50% YTY

• Total 2005 carrier data Total 2005 carrier data revenues of $8.6Brevenues of $8.6B– Up 86%Up 86%

• Early as a content Early as a content platformplatform

Actual Projected

Mil

lion

s

0

50

100

150

200

250

2002 2003 2004 2005 2006 2007 2008 2009 2010

U.S. Mobile Phone Users

Source: Yankee Group 2005

3G – High Speed Mobile Networks3G – High Speed Mobile Networks• Analogous to Broadband Analogous to Broadband

InternetInternet

• Carriers invested $200B Carriers invested $200B to secure licenses and to secure licenses and deploy networksdeploy networks

• 3G adoption driven by 3G adoption driven by handset turnover every handset turnover every 18 months18 months

• Carriers focused beyond Carriers focused beyond commodity voice traffic. commodity voice traffic. Video content is criticalVideo content is critical

0

10

20

30

40

50

60

70

80

90

2004 2005 2006 2007 2008 2009 2010

U.S. 3G Mobile Users

Source: Yankee Group 2005

New Media LandscapeNew Media Landscape

• Broadband means increased consumption Broadband means increased consumption of Internet contentof Internet content

• Media platforms are fragmenting and Media platforms are fragmenting and proliferatingproliferating

• Media consumption is changing; we are Media consumption is changing; we are moving to an on-demand content worldmoving to an on-demand content world

• Consumers expect content whenever, Consumers expect content whenever, wherever, and however they want itwherever, and however they want it

Where the PGA TOUR is goingWhere the PGA TOUR is going

• Experiment with alternative distribution Experiment with alternative distribution

• Adjust strategies and business modelsAdjust strategies and business models

• Future: 3-screen video worldFuture: 3-screen video world

MobileMobileBroadband InternetBroadband InternetTelevisionTelevision

Golf Well-suited to Leverage New PlatformsGolf Well-suited to Leverage New Platforms• Nature of SportNature of Sport

– In-office audienceIn-office audience– Significant play outside Significant play outside

telecast windowtelecast window– Inability to provide full coverage Inability to provide full coverage

within telecast windowwithin telecast window

• Significant “fan-favorites”, Significant “fan-favorites”, interest around individual interest around individual playersplayers

• Fans are consuming content Fans are consuming content from new platformsfrom new platforms

There is fan demand for coverage beyond the TV window

pgatour.com & pga.compgatour.com & pga.com

• Largest non-TV audienceLargest non-TV audience• 30% yr-to-yr growth over five years30% yr-to-yr growth over five years• 5.1 M unique users5.1 M unique users• Over 31 minutes spent per user Over 31 minutes spent per user

per monthper month

• Leading instructional golf siteLeading instructional golf site• Access to 28,000 dedicated Access to 28,000 dedicated

professionals promoting the gameprofessionals promoting the game• Direct link to local instructorsDirect link to local instructors

pgatour.com

pga.com

Leverage synergies in new media landscape

PGA TOUR New Media PlatformsPGA TOUR New Media Platforms

Internet/Broadband

PGA TOUR Highlights

•First Round•Second Round•Third Round•Final Round

PGA TOUR Interviews

•Tiger Woods•Ernie Els•Phil Mickelson

Non-Standard TV*

Mobile

Rich content delivery Anytime, anywhere

VOD/DVR Data channels Two-Screen interaction HDTV

Increased mobility Interactive

Sat. Radio/Radio

Mobile medium Multi-programming

formats

On Venue

Information demand Multi-platform

deployment

Video Game

Rapidly growing Wired home

Fan Database

Direct marketing 1:1 fan communication

Close the LoopClose the Loop

FAN

pgatour.comBroadcastMedia

• Fan-centric broadcastsFan-centric broadcasts– ContestsContests– Voting (i.e. American Idol)Voting (i.e. American Idol)

• Content links from BroadcastContent links from Broadcast• Fantasy GolfFantasy Golf• Play Golf AmericaPlay Golf America• The First Tee School ProgramThe First Tee School Program

Fan Activation 2007Fan Activation 2007

Core Golfers

Golfers

Fans

Apply programs in new media environment

Focus in 2007Focus in 2007

• Leverage energy from FedExCup: “New era in golf”Leverage energy from FedExCup: “New era in golf”

• Growth opportunity with Baby BoomersGrowth opportunity with Baby Boomers

• Reach more fans with richer content through new mediaReach more fans with richer content through new media

• Maturity of national golf development programsMaturity of national golf development programs

• ““Close loop” for fan experienceClose loop” for fan experience

• Challenge to Industry Operators and MediaChallenge to Industry Operators and Media::– Continue to support player development programsContinue to support player development programs– Build and promote a development calendarBuild and promote a development calendar– Create innovative ways to convert fans into golfersCreate innovative ways to convert fans into golfers