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Internet Trends and Web Basics
Copyright © Ellis Horowitz & 1999-2022 1

The Internet and the WWW are Different

•The Internet is a global digital infrastructure that connects hundreds of millions of computers and people
•The World Wide Web is a mechanism that unifies the retrieval and display of a subset of data on the Internet
•An intranet is a local/global information structure that connects an organization internally. Intranets today often make use of Web technologies
•An extranet is a private network that uses the public telecommunication system to securely share part of a business’s information or operations with suppliers, vendors, partners, customers, or other businesses.
Copyright © Ellis Horowitz & 1999-2022 2

Recent Trends in Internet Development
• Growth in number of users connected
• Growth in Smartphone use, particularly iOS and Android
• Growth in digital data, especially photos and video
• Growth in Social Media
• Growth in Internet use from Mobile over desktop/laptop
• Growth in tablet usage over desktops/laptops
• Decreased dominance of Microsoft Windows
• Growth in use of the cloud
Copyright © Ellis Horowitz & 1999-2022 3

How Big is the Internet (historical) https://www.isc.org/network/survey
hosts were doubling every 18 months, but growth has slowed
See the survey background at: http:///www.isc.org/network/survey
It counts the number of IP addresses that have been assigned a name. The survey queries the domain name system for the name assigned to every possible IP address. But rather than sending a query to every one of the 4.3 billion possible IP addresses, the survey starts with a list of all network numbers that have been delegated within the IN-ADDR.ARPA domain. This survey has been discontinued.
Copyright © Ellis Horowitz & 1999-2022 4
Jul 93 | 1,776,000
Jan 93 | 1,313,000
Date | HostCount
——-+———–
Jan 19 |1,012,695,272
Jul 18 |1,015,787,389
Jan 18 |1,003,604,363
Jul 17 |1,074,971,748
Jan 17 |1,062,660,523
Jan 16 |1,048,766,623
Jul 15 |1,033,836,245
Jan 15 |1,012,706,608
Jul 14 |1,028,544,414
Jan 14 |1,010,251,829
Jul 13 |996,230,757
Jan 13 |963,518,598
Jul 12 |908,585,739
Jan 12 |888,239,420
Jul 11 |849,869,781
Jan 11 |818,374,269
Jul 10 |768,913,036
Jan 10 |732,740,444
Jul 09 |681,064,561
Jan 09 |625,226,456
Jul 08 |570,937,778
Jan 08 |541,677,360
Jul 07 |489,774,269
Jan 07 |433,193,199
Jul 06 |439,286,364
Jan 06 |394,991,609
Jul 05 |353,284,187
Jan 05 |317,646,084
Jul 04 |285,139,107
Jan 04 |233,101,481
Jan 03 |171,638,297
Jul 02 |162,128,493
Jan 02 |147,344,723
Jul 01 |125,888,197
Jan 01 |109,574,429
Jul 00 | 93,047,785
Jan 00 | 72,398,092
Jul 99 | 56,218,000
Jan 99 | 43,230,000
Jul 98 | 36,739,000
Jan 98 | 29,670,000
Jul 97 | 19,540,000
Jan 97 | 16,146,000
Jul 96 | 12,881,000
Jan 96 | 9,472,000
Jul 95 | 6,642,000
Jan 95 | 4,852,000
Jul 94 | 3,212,000
Jan 94 | 2,217,000

Global Internet Users =
China @ 21% of Total…India @ 12%…USA @ 8%
China India United States Indonesia Brazil Japan Russia Mexico Germany The Philippines United Kingdom Iran (I.R.) Nigeria France Turkey
Internet Users 􏰀 Top Countries, 2018
Internet Users Non-Internet Users
Internet Trends 2019
Internet user data is as of mid-year. Source: United Nations / International Telecommunications Union, USA Census
Bureau. (USA), China Internet Network Information Center (China), Islamic Republic News Agency / 11
InternetWorldStats / Bond estimates (Iran), Bond estimates based on IAMAI data (India), & APJII (Indonesia).
The following slides are based upon a presentation by of Bond and formerly of Kleiner Perkins Caufield and Byers, see https://www.bondcap.com/#internettrends
Copyright © Ellis Horowitz & 1999-2022 5

Global Internet Users = 3.8B >50% of Population
Internet Penetration, 2018
2009 2010 2011
2014 2015 2016
Internet Trends 2019
Internet user data is as of mid-year. Source: United Nations / International Telecommunications Union, USA Census
Bureau. (USA), China Internet Network Information Center (China), Islamic Republic News Agency / 9
InternetWorldStats / Bond estimates (Iran), Bond estimates based on IAMAI data (India), & APJII (Indonesia).
Copyright © Ellis Horowitz & 1999-2022 7
Internet Penetration, Global

Global Internet User Growth =
Solid But Slowing +6% vs. +7% Y/Y
Internet Users vs. Y/Y Growth
0 0% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Internet Trends 2019
Internet user data is as of mid-year. Source: United Nations / International Telecommunications Union, USA Census
Bureau. (USA), China Internet Network Information Center (China), Islamic Republic News Agency / 7
InternetWorldStats / Bond estimates (Iran), Bond estimates based on IAMAI data (India), & APJII (Indonesia).
Copyright © Ellis Horowitz & 1999-2022 8
Internet Users, Global (Blue Bar)
Y/Y Growth (Red Line)

Examining smartphone operating systems, over the past seven years, iOS and Android have made major gains with Nokia disappearing and Linux a very small piece of the pie
Copyright © Ellis Horowitz & 1999-2022 11

Global Unit Shipments = Declining -4% vs. 0% Y/Y
Unit Shipments vs. Y/Y Growth
Source: @ (3/19), IDC.
Internet Trends 2019
Copyright © Ellis Horowitz & 1999-2022 12
Shipments, Global
Y/Y Growth (Red Line)

􏰁􏰂􏰃􏰂 􏰅􏰆􏰇􏰈􏰉􏰊 􏰋 􏰌􏰍􏰃􏰎􏰂􏰆􏰎􏰏􏰐􏰑􏰂􏰎􏰒 􏰓􏰎􏰆􏰔􏰃􏰕􏰖 ~13% Structured / Tagged & Rising Rapidly
There has been exponential growth in online information;
1 Zettabyte = 1,024 Exabytes
1 Exabyte = 1,024 Petabytes
New Data Captured / Created / Replicated, per IDC
1 Petabyte = 1,024 Terabytes
1 Terabyte = 1,024 Gigabytes
1 Zettabyte = 1,000,000,000,000 gigabytes
Replicated Data
Original Data
9% Structured
2010 2015 2020E
Internet Trends 2019
􏰗􏰆􏰈􏰎􏰘􏰊􏰙 􏰚􏰁􏰛 􏰜􏰁􏰐􏰝􏰐􏰃􏰐􏰞􏰂􏰃􏰐􏰆􏰑 􏰆􏰟 􏰃􏰕􏰊 􏰠􏰆􏰎􏰇􏰏 􏰡􏰎􏰆􏰉 􏰌􏰏􏰝􏰊 􏰃􏰆 􏰛􏰆􏰎􏰊 􏰠􏰕􏰐􏰃􏰊 􏰢􏰂􏰣􏰊􏰎􏰤 􏰏􏰊􏰥􏰊􏰇􏰆􏰣􏰊􏰏 􏰐􏰑 􏰘􏰆􏰇􏰇􏰂􏰦􏰆􏰎􏰂􏰃􏰐􏰆􏰑 􏰔􏰐􏰃􏰕 􏰗􏰊􏰂􏰝􏰂􏰃􏰊 􏰧􏰨􏰨􏰩􏰨􏰪􏰫􏰬 􏰚􏰁􏰛 􏰁􏰂taSphere. Note: 1 petabyte = 1MM gigabytes, 1 zeta byte = 1MM petabytes of new data created / captured each year. The grey area in the graph represents data generated, not stored. Structured data indicates data that has been organized so that it is easily searchable & includes metadata & machine-to-machine (M2M) data. Replicated data = data that is a copy of the original..
Copyright © Ellis Horowitz & 1999-2022
Data Volume, Annual, Global (ZB)

500 million photos are uploaded every day and that number is doubling every year
Instagram was recently (2010) purchased by Facebook for
$1 billion
Snapchat is a photo messaging application developed by two Stanford students (IPO March 2017, $17B valuation);
bobby Murphy –
Copyright © Ellis Horowitz & 1999-2022 14

Online Platform Time =
YouTube + Instagram Gaining Most
% Internet Users Using Select Platforms > 1x per Day, Global*
31% 30%
25% 23% 23%
Facebook Messenger
Q2:17 Q3:17 Q4:17 Q1:18 Q2:18 Q3:18 Q4:18
Source: Global Web Index Survey of 50K+ Global Internet users aged 16-64 (3/2017-12/2018). Note: WeChat is displayed as “Weixin” in China. *Countries surveyed include major Internet populations 􏰀 Argentina, Australia, Austria, Belgium, Brazil, Canada, China, Colombia, Denmark, Egypt, France, Germany, , India, Indonesia, Ireland, Italy, Japan, Malaysia, Mexico, 47
Internet Trends Netherlands, , Philippines, Poland, Portugal, Romania, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, UK, 2019 􏰭􏰗􏰮􏰬 􏰭􏰑􏰐􏰃􏰊􏰏 􏰮􏰎􏰂􏰦 􏰌􏰉􏰐􏰎􏰂􏰃􏰊􏰯􏰬 􏰅􏰐􏰊􏰃􏰑􏰂􏰉􏰰 􏰱􏰆􏰈􏰃􏰐􏰂􏰆 􏰊􏰯􏰃􏰐􏰉􏰂􏰃􏰊 􏰋 􏰲􏰳􏰴 􏰆􏰟 􏰚􏰑􏰃􏰊􏰎􏰑􏰊􏰃 􏰈􏰯􏰊􏰎􏰯 􏰈􏰯􏰐􏰑􏰝 􏰁􏰆􏰈􏰒􏰐􏰑 􏰐􏰑 􏰵􏰶􏰨􏰪􏰖􏰰􏰷􏰆􏰃 􏰐􏰑􏰘􏰇􏰈􏰏􏰊􏰏 􏰆􏰔􏰐􏰑􏰝 􏰃􏰆 􏰇􏰂􏰘k of trend data & regulatory action in period.
Copyright © Ellis Horowitz & 1999-2022 16

China Mobile Internet Users = 􏰪􏰨􏰸􏰹􏰹􏰖􏰺􏰻􏰴 􏰥􏰯􏰰 􏰺􏰪􏰴 􏰼􏰩􏰼
China Mobile Internet Users vs. Y/Y Growth
1000MM 80%
0 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
China Mobile Internet Users Y/Y Growth
Internet Trends 2019
Source: China Internet Network Information Center Note: Mobile Internet User Data is as of Year-End.
Copyright © Ellis Horowitz & 1999-2022 20
Mobile Internet Users, China
Growth, Y/Y

Video Time =
Digital +2x in Five Years @ 28% of Total (vs. TV)
Video Watching Daily Minutes 􏰀 Digital vs. TV, USA
2012 2013 2014 2015 2016 2017 2018
Digital Video
Television
Internet Trends 2019
Source: eMarketer (10/18). Usage includes both home & work for consumers 18+. Non de-duplicated defined as time spent with each medium individually, regardless of multitasking.
Copyright © Ellis Horowitz & 1999-2022 23
Average Daily Time Spent (Minutes), USA

􏰮􏰏􏰈􏰇􏰃􏰯 􏰜􏰮􏰇􏰉􏰆􏰯􏰃 􏰛􏰆􏰑􏰯􏰃􏰂􏰑􏰃􏰇􏰒􏰤 􏰽􏰑􏰇􏰐􏰑􏰊 􏰋 26% vs. 21% Three Years Ago
􏰴 􏰆􏰟 􏰮􏰏􏰈􏰇􏰃􏰯 􏰽􏰑􏰇􏰐􏰑􏰊 􏰜􏰮􏰇􏰉􏰆􏰯􏰃 􏰛􏰆􏰑􏰯􏰃􏰂􏰑􏰃􏰇􏰒􏰤
By Age Group
All Adults
25% 50% % of Respondents in , USA
Source: (7/15 + 1/18)
Internet Trends 2019
Copyright © Ellis Horowitz & 1999-2022 24
% of Respondents, USA

Social Media = Positive & Negative
Do Social Media Platforms You Use Make These Health-Related Factors Better or Worse?
Better / Positive
Self-Expression Self-Identity Community Building Emotional Support Awareness of Others Access To Health Info Real-World Relationships Loneliness Average Depression Anxiety Body Image Bullying Fear of Missing Out Sleep Quality / Amount
Worse / Negative
More Negative
More Positive
􏰗􏰆􏰈􏰎􏰘􏰊􏰙 􏰾􏰆􏰒􏰂􏰇 􏰗􏰆􏰘􏰐􏰊􏰃􏰒 􏰡􏰆􏰎 􏰢􏰈􏰦􏰇􏰐􏰘 􏰿􏰊􏰂􏰇􏰃􏰕 􏰗􏰈􏰎􏰥􏰊􏰒 􏰆􏰟 􏰨􏰬􏰳􏰸􏰻 􏱀􏰎􏰐􏰃􏰐􏰯􏰕 􏰃􏰊􏰊􏰑􏰯 􏰐􏰑 􏰜􏰊􏰂􏰎􏰇􏰒-􏰵􏰶􏰨􏰸􏰤 􏰌􏰂􏰘􏰕 􏰃􏰊􏰊􏰑 􏰔􏰂􏰯 􏰂􏰯􏱁􏰊􏰏 􏰃􏰆 􏰎􏰂􏰃􏰊 􏱂 􏰆􏰟 􏰃􏰕􏰊 􏰉􏰆􏰯􏰃 popular social networks (YouTube, Facebook, Twitter, Snapchat & Instagram) on each dimension. Data presented = average of scores for each social network.
Internet Trends . 2019
Copyright © Ellis Horowitz & 1999-2022 25

Digital Media =
Businesses Taking Action to Help Users Monitor Usage
Major Platforms Launched Wellness / Time Tracking Features
Screen Time
Digital Wellbeing
Your Time on Facebook
Time Watched
Source: Apple, YouTube, Google, Facebook
Internet Trends 2019
Copyright © Ellis Horowitz & 1999-2022 26

􏰖􏰛􏰇􏰆􏰈􏰏 􏰁􏰊􏰣􏰇􏰆􏰒􏰉􏰊􏰑􏰃 􏰋
22% of Workloads +2x vs. Five Years Ago
Technology Adoption Rates, Global per
2010 2012 2014 2016 2018
Laptop (% of PC Sales)
Online Music (% of Total Sales)
1998 2000 2002 2004 2006 2008
Cloud((%ooffWEonrtkelorpardis)e Workloads) Smartphone (% of Handset Sales)
Internet Trends 2019
Source: (5/18-3/19). Note: Estimate of Cloud workload
penetration based on CIO survey in Q4 of each year. 117
Copyright © Ellis Horowitz & 1999-2022 33
Technology Penetration / Adoption (%)

Digital Media Usage = Accelerating +7% vs. +5% Y/Y
Daily Hours Spent with Digital Media per Adult User, USA
2008 2009 2010
Other Connected Devices
Desktop / Laptop
Source: eMarketer 9/14 (2008-2010), eMarketer 4/15 (2011-2013), eMarketer 4/17 (2014-2015), eMarketer 10/18 (2016-2018). Note: Other connected devices include OTT & game consoles. Mobile includes smartphone & tablet. Usage includes both home &
Internet Trends work for consumers 18+. Non deduped defined as time spent with each medium individually, regardless of multitasking. 2019
Copyright © Ellis Horowitz & 1999-2022 35
Hours Spent per Day, USA

Video Time (Short-Form 􏰀 Facebook Platform) = 1.5B DAUs + ~2x in One Year
Facebook Stories
Daily Active Users, Global*
10/17 4/18 10/18 4/19
Instagram Stories WhatsApp Status Facebook / Messenger Stories
Internet Trends 2019
Source: Facebook (8/18,12/18). Daily Active Users (DAU) = Users that interact with a Story daily.
Vertical segments of chart = owing to first reported DAU metric for each product. *Not de-duped across platforms.
Copyright © Ellis Horowitz & 1999-2022 45
Daily Active Users, Global

Digital Media =
Privacy Concerns High But Moderating
People More Concerned About Internet Privacy vs. One Year Ago, Global
2015 􏰀 Anthem Health announces that 80MM personal health records were stolen in a 􏰜􏰯􏰆􏰣􏰕􏰐􏰯􏰃􏰐􏰘􏰂􏰃􏰊􏰏 􏰂􏰃􏰃􏰂􏰘􏱁􏰤
2017 􏰀 Equifax reveals the personal financial records of
over 145MM Americans owing to an unsecured web portal
2014 􏰀 The New York Times reports on NSA documents showcasing government tracking of USA smartphone use
2016 􏰀 Yahoo! reveals that 3B Customer records, including names, address & encrypted passwords were breached
2018 􏰀 The New York Times reveals Cambridge Analytica improperly accesses 87MM Facebook profiles
2016 2017 2018
Internet Trends 2019
Source: CIGI-IPSOS Global Survey on Internet Security & Trust 2014, 2016, 2017, 2018. 2018 = 24,750 Internet users from 12/29/17-3/5/18. 2017 = 24,225, 2016 = 24,143, 2014 = 23,376.
Copyright © Ellis Horowitz & 1999-2022 46
% of Respondents

Digital Media =
Encrypted Messaging / Traffic Rising Rapidly
Select Messenger MAUs
% of Web Traffic Encrypted
Q1:16 Q3:16 Q1:17 Q3:17 Q1:18 Q3:18 Q1:19
Default End-to-End Encryption
Optional / Announced End-to-End Encryption
No End-to-End Encryption
Internet Trends 2019
Source: Google, Tencent, Twitter, Facebook, Apple, Telegram releases & estimates. Note: *iMessage2 MAUs calculated by install base of Apple iPhones, as
estimated by Credit Suisse (2014-2017). WhatsApp employs end-to-end encryption by default. Facebook Messenger has end-to-end encryption capabilities but users have to manually enable them. Instagram does not have end-to-end encryption but Facebook is planning to add that feature & make Facebook Messenger encrypted by default (1/19). All Gmail messages are encrypted at rest and in transit. Fortinet Q3:18 Quarterly Threat Landscape Report (11/18). HTTPS = Hyper Text Transfer Protocol Secure is the secure protocol over which data is sent between the browser and the website the user is connected to.
Copyright © Ellis Horowitz & 1999-2022 47
Monthly Active Users
% of Web Traffic, Global

47MM Amazon Echo Base + ~2x in One Year
Amazon Echo Installed Base
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2015 2016 2017 2018
Amazon Echo Skills
2015 2016 2017 2018 2019 YTD
Internet Trends 2019
Source: Consumer Intelligence Research Partners LLC (Echo install base, 2/18), Various
media outlets including Geekwire, TechCrunch, & Wired (Echo skills, 4/19) 51
Copyright © Ellis Horowitz & 1999-2022 60
Installed Base, USA
Number of Skills

Wearables =
52MM Users + ~2x in Four Years
Wearable Users, USA
2014 2015 2016 2017 2018
Source: eMarketer (11/18). Users = Monthly Active adults 18+ years old who wear accessories or clothing embedded with electronics, software, or sensors that have the ability to connect to the Internet (via built-in connectivity or tethering),
Internet Trends which in turn collects & exchanges data with a manufacturer, operator, or other connected devices. 2019
Copyright © Ellis Horowitz & 1999-2022 61
Wearable Users, USA

Effective + Efficient Marketing = Can Be Free Trial / Tier
Online Streaming 􏰀 Reasons For Trying New Service
F ree TFrrieael / T Tri i aelr
Content Library
Access to Exclusive Content
Good User Experience
Source: 2BrightCove / YouGov survey of 10,502 adults in USA, UK, France, Australia, Germany, Canada & UAE, 9/18.
Internet Trends 2019
Copyright © Ellis Horowitz & 1999-2022 66

􏰿􏰂􏰣􏰣􏰒 􏰛􏰈􏰯􏰃􏰆􏰉􏰊􏰎􏰯􏰖
􏰗􏰣􏰆􏰃􏰐􏰟􏰒 􏰋 􏰡􏰎􏰊􏰊 􏰭􏰯􏰊􏰎 􏰛􏰆􏰑􏰥􏰊􏰎􏰯􏰐􏰆􏰑 􏰃􏰆 􏰢􏰂􏰐􏰏 􏰗􏰈􏰦􏰯􏰘􏰎􏰐􏰦􏰊􏰎􏰯􏰖
Free Ad-􏰗􏰈􏰣􏰣􏰆􏰎􏰃􏰊􏰏 􏰢􏰎􏰆􏰏􏰈􏰘􏰃􏰖
􏰖􏰾􏰐􏰯􏰐􏰑􏰝 􏱃􏰱􏰅 􏰩 􏰗􏰈􏰦􏰯􏰘􏰎􏰐􏰦􏰊􏰎 􏰮􏰘􏱄􏰈􏰐􏰯􏰐􏰃􏰐􏰆􏰑 􏰛􏰆􏰯􏰃 􏰾􏰂􏰃􏰐􏰆
LTV:CAC Estimate
Our freemium model accounts for
~60% of our gross added premium subscribers… the ad-supported service is a subsidy program that offsets costs of new subscriber acquisition.
Developing a better user experience produces by far the most viral effect & impact when investing in growth. Engagement drives conversion from free consumption to paid subscription.
Carthy 􏰀 CFO, Spotify, 3/18
Internet Trends 2019
Source: Spotify releases & estimates of LTV & SAC. Carthy @ Spotify Investor Day (3/18). Note: estimates LTV by calculating the valu

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