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What we’ve done (so far)

…in Brazil :

• 100% of art house theatres are connected to the Rain Network

• 134 digital screens operating across 20 cities

• 157 films shown digitally

…in the USA :

• 26 theatres operating in 23 cities

• Over 350 digital titles available including:

- Full Frame film festival 2006, 2007 - Latin Beat film festival 2006, 2007 - Global Lens, 2007 - Undiscovered Gems, 2005, 2006, 2007 - The Metropolitan Opera (NYC) in HD, 2007, 2008 - La Scala Opera (Italy) in HD, 2008

DIGITAL ART HOUSESDIGITAL ART HOUSES

How we do itTechnology + Innovation

Operation

Database

Kinocast Player

IP Network

Central Server

Kinocast WebCapture and encoding

Ad Agencies ExhibitorsDistributors Projector

Local Server

VPN VPNMaster HD

Theatre Management System & Kinocast Web

• 24 hour phone and online support• Network operations center

Monitoring

Why we do itThe Market Opportunity

The Market Opportunity

“Our culture and economy are increasingly shifting away from a focus

on a relatively small number of hits (mainstream products and

markets) at the head of the demand curve, and moving toward a

huge number of niches in the tail.”    

Chris Anderson

The Long Tail

The Market Opportunity

“Recommendations have all the demand-generation power of advertising, but

at virtually no cost.” Chris Anderson

The Long Tail Facts

75%75% of of MySpaceMySpace members use the site to find musicmembers use the site to find music

60%60% of of NetflixNetflix rentals come from recommendations rentals come from recommendations

WHY WE DO ITWHY WE DO ITWHY WE DO ITWHY WE DO IT

Consumers want more options, access and control – niche products for all tastes

Give them access – Rain’s digital network

Make everything available – provide a robust

film library

Help them find it

A new business model

ESPAÇO DE EXIBIÇÃO

“Theatrical on Demand”

• Digital Theatre Network

• International Film Library

• New cross-media marketing strategies

• Web theatrical management system

• Web 2.0 booking

• Efficient revenue share model

• Agility, Flexibility, Security, Visibility

• Low risk – high return

A new business model

“Theatrical on Demand”

key advantages

• No print or delivery costs

• Secure online delivery via Virtual Private Network (VPN)

• Only one encrypted encode per film worldwide

• Multiple language subtitling

A new business model

ESPAÇO DE EXIBIÇÃO

Cross-Media Marketing Strategies

• Digital pre-show for trailers – programmed and controlled by Rain

• Digital Media Signage – programmed and controlled by Rain

• Digital word of mouth – widgets

• Online social network – YouRain

• Blog reviews

• Programming block / line up – collective advertising on tv and radio

• Publicity

• Guerilla marketing - events and promotions

A new business model

“Theatrical on Demand”

business proposal

• 50% - 50% from the film rental between Rain/Licensor

• $15K P&A, flat fee, retained per new feature

• No P&A retained for classic or catalogue films

• 30% DVD Royalty

• 50% VOD net revenue share

• 80% TV Royalty

A new business model

Theatrical on Demand

Partnering with one of Latin America’s most

important independent distributors…

A new business model

Benefits for ExhibitorsSales AgentsProducers

Benefits for Exhibitors

Rain offers programming independence

+ Access to more movies

+ Online programming

+ Remote access for scheduling sessions

+ Online exhibition control

+ Flexibility in programming - optimizing theatre occupancy

+ New advertising and event revenue

= AGILITY, FLEXIBILITY, QUALITY, & SECURITY

Benefits for Sales Agents

Rain offers lower risk release and provides savings in 35mm and logistics

+ More films on more screens

+ Simple logistics

+ One encoding per film worldwide

+ Multiple subtitles

+ Simultaneous release

+ Efficient revenue share based model

= NEW OPPORTUNITIES, SAVINGS, & LOWER RISKS

Benefits for Producers

Rain increases movie visibility

+ Low investment at release

+ Rights management

+ Multiple subtitles

+ Real time auditing

+ Larger number of screens

+ Delivery and transfer savings

= VISIBILITY + ACCESS + SECURITY + FLEXIBILITY

Case Study

Case Study “9 Songs”• Digital release generated positive cash flow for sales agents

• Digital content reduced the initial risk + costs involved with replication

• Movies being distributed in regions where there was no previous market penetration = new audiences + new theaters

2008 Global rollout of over 300 art house digital screens throughout the US, Europe and Latin America.

The Tools

Online social network connecting moviegoers to an e-box office for screenings on demand

Consumers can:

• Decide which films they want to see, when and where

• Schedule and book community demand based screenings

• Access a huge database from classics, to festival films to small foreign films

• Discover new and old films through the power of social media referrals

• Create and join film clubs

The Tools

The Tools

The Tools

Traveling seasonal film festival showcase for festival fans

Audiences can:

• Watch films from renowned international festivals

• See non-commercially released films

• Enjoy different film styles and genres from around the world

The Tools

E-Marketplace for indie film distribution

Sales Agents can:•Make real time negotiations and deal transactions using a revenue share based model

•Show more films on more screens due to savings in 35mm prints, delivery and subtitling

•Low risk – high return

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