May 2013
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This presentation may contain forward-looking statements that reflect current views with respect to future events and operating performance. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. For more information on the Company's risks and uncertainties relating to those forward-looking statements, please refer to Destiny Media Technologies Quarterly report 10-Q ending Feb 28, 2013 risk factors section, which is available on www.sedar.com
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Corporate Overview
Clipstream® Play MPE®
Disruptive Streaming media technology
Enables video files to play on all devices
90% lower bandwidth cost
Videos will "just play" in browsers with no need for player plug-ins.
< 5% of TTM* revenue
$1 billion + addressable market opportunity
Secure electronic delivery of music to radio stations before it is available for sale
Used by all 4 majors and 1,000 independent record labels globally
Fraction of cost of physical distribution
>95% of TTM* revenue
$40 million commercial market opportunity
Secure, automated distribution of audio and video content online
Founded: 1991
Head Office: Vancouver Canada
* TTM – Trailing Twelve Months
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Investment Merits
Disruptive video encoding technology with the potential to change the way video is delivered to devices over the internet. Solid portfolio of Intellectual property - Clear technology leadership with 3 patents granted, and 7 pending. Fully funded “capital light” business model - Fully funded with $1.3 million in cash, no debt and positive free cash flow generation “Capital light” business model with significant earnings leverage - Business model requires limited growth capital and is expected to produce >70% incremental profit margin
Destiny Media Technologies (TSX:DSY OTC:DSNY)
Recent Price (5/1/13) $0.85
52-Week Range $0.57 - $1.06
Fiscal Year End August
Shares Outstanding 52.0M
Ave. Trading Volume 100,000
Market Capitalization $44M
Net working capital $1.8M
Long-Term Debt NA
Enterprise Value $42M
Music industry standardization on Destiny’s Technology - Agreements with all of the major labels, 1,000 independents, and a recently announced global pricing agreement, the music industry is increasingly standardizing on Play MPE. Nearing inflection point in the growth curve - Clipstream is expected to begin contributing materially to new revenue this year. Play MPE has only penetrated 10% of a $40 million annual recurring revenue opportunity. Revenue growth is expected to resume at a robust pace over the next 3-5 years.
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Clipstream®
A pure play on the continued high growth adoption of streaming internet video. A simpler
solution for website owners requiring much less infrastructure and up to 90% less
bandwidth.
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Clipstream® - Industry Background
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Estimated Internet Video Data Growth
0.9 1.6
2.8
4.7
7.4
11.2
0
2
4
6
8
10
12
2012 2013 2013 2013 2013 2013
Exabytes per Month
66% CAGR 2012-2017
Source: Cisco VNI Mobile Forecast, 2013
Clipstream® - Industry Background
Steve Job’s Open Letter on Flash Rather than use Flash, Apple has adopted HTML5, CSS and JavaScript – all open standards. Apple’s mobile devices all ship with high performance, low power implementations of these open standards. HTML5, the new web standard that has been adopted by Apple, Google and many others, lets web developers create advanced graphics, typography, animations and transitions without relying on third party browser plug-ins (like Flash). Steve Jobs April, 2010
Consequences Adobe will not support Mobile Video does not play everywhere Added cost and complexity Proliferation of video codecs
No common Standard for Video Creates Opportunity for Destiny Media
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Clipstream® - Disruptive to ≈ $5 Billion Industry
Transcoding
$1.6bn annually
Content Delivery Networks
$3bn annually
Source: CDN current market estimate from Accustream Research as of 2012. Transcoding estimate for 2014 from a 2007 report by Frost & Sullivan
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Clipstream® - Disruptive to ≈ $5 Billion Industry
Clipstream Value Proposition
Plays on any modern web browser
No player software to configure or install
Never goes obsolete and has longevity
Up to 90% cost savings on infrastructure and bandwidth
Security and tracking capability
Eliminates the Need for Transcoding and Content
Delivery Networks
Video files are cached as web content on a web server
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Market
Research
Web
Developers
Site
Licenses
Chipset
Integration Internet
Radio
Hardware
Licensing
Advertising
165 million video
surveillance cameras installed
worldwide
185 million tablets expected to be sold
in 2015
700 million smart phones
shipped in 2012
350 million PCs sold each year
44,000 Radio Worldwide
150 Global Advertising Agencies 100’s of seven-
figure site license
opportunities
Clipstream® Market Size / Opportunity
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Play MPE® - Emerging Industry Standard
Play MPE® is a secure distribution system record labels use to deliver pre-release content through the internet to Radio Stations,
music journalists, DJs, and other music Industry professionals. The content is protected by proprietary patented locking and
watermarking technology.
Radio Stations Music Journalists
Music DJs
> 1,000 Independent
Labels
Content Creators Music Industry Participants
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Play MPE® - Value Proposition
Allows digital content owners to seamlessly distribute and control data to respective audience Target end-users including radio, press, industry professionals, internal staff, DJs, film and TV, sports stadiums, VIPs and more
Play MPE® Benefits
Encrypted lossless format
Lower cost than physical distribution
Proprietary digital watermark (forensic trace)
Proprietary locking
Instant distribution
Real-time reporting
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Play MPE® Market Size / Opportunity
Revenue Model transaction-based Registered users – 64,194 Total Tracks – 1,017,470 Total Deliveries – 328,537,200* *as of March 2013
Market size is = $60 million Addressable Market = $40 million Growth to new markets and new recipient types
Other market opportunities with Play MPE®
Sales to consumers through retail Film, TV, commercials etc. opportunity Licensing of locking and watermarking patents
Market dominance
Emerging markets
Occasional usage
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Play MPE® - Emerging Industry Standard
Used by recording industry globally
(over 1,000 labels)
Custom player software available for
Windows, Mac OS and iOS, with
Android, Blackberry and tablet apps
coming soon
Integrated with Clear Channel's
Reporting & Scheduling systems,
BBC Radio and Sirius XM
Available in 27 languages
Permission-based encoding
Play MPE® Partners
Play MPE® Customers
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Financial Summary
Focus on Revenue and EBITDA
2011 2010
2012 2012 2013
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Financial Summary
Revenue & Earnings Charts
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Investment Merits
Disruptive video encoding technology with the potential to change the way video is delivered to devices over the internet. Solid portfolio of Intellectual property - Clear technology leadership with 3 patents granted, and 7 pending. Fully funded “capital light” business model - Fully funded with $1.3 million in cash, no debt and positive free cash flow generation “Capital light” business model with significant earnings leverage - Business model requires limited growth capital and is expected to produce >70% incremental profit margin
Destiny Media Technologies (TSX:DSY OTC:DSNY)
Recent Price (5/1/13) $0.85
52-Week Range $0.57 - $1.06
Fiscal Year End August
Shares Outstanding 52.0M
Ave. Trading Volume 100,000
Net Working Capital $1.8M
Market Capitalization $44M
Cash & Equivalents $2M
Long-Term Debt NA
Enterprise Value $42M
Music industry standardization on Destiny’s Technology - Agreements with all of the major labels, 1,000 independents, and a recently announced global pricing agreement, the music industry is increasingly standardizing on Play MPE. Nearing inflection point in the growth curve - Clipstream is expected to begin contributing materially to new revenue this year. Play MPE has only penetrated 10% of a $40 million annual recurring revenue opportunity. Revenue growth is expected to resume at a robust pace over the next 3-5 years.
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Contact
Destiny Media Technologies, Inc. Suite 750 , PO Box 11527 650 West Georgia Street Vancouver, BC V6B 4N7 North America: 1-800-8-DESTINY International: (00) 800-4752-9673 Local: (604) 609-7736 Fax: (604) 609-0611 http://www.dsny.com DSNY-OTCQX, DSY-TSXV, DME-Frankfurt Investor Relations Dave Mossberg Three Part Advisors, LLC 817 310-0051
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