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Page 1: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

May 2013

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Page 2: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 3: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 4: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 5: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 6: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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

Page 7: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 8: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 9: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 10: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 11: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 12: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 13: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 14: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 15: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

Financial Summary

Focus on Revenue and EBITDA

2011 2010

2012 2012 2013

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Page 16: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

Financial Summary

Revenue & Earnings Charts

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Page 17: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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Page 18: May 2013 - Aberdeen Investment Management, · PDF fileMay 2013 1 . This presentation ... earnings leverage - Business model requires limited ... A pure play on the continued high growth

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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