1. State of the Business
Deck
April 13th, 2014
info@stationdigital.com
(877) 482-9585
5042 Wilshire Blvd | #26900 | Los Angeles, CA | 90036
2. StationDigital
Mission Statement
StationDigitalās mission is to create the
Internetās most content rich, consumer
essential, and experientially trendsetting
digital media broadcasting platform ā one
that delivers the most consistent, robust,
and seamless experience across every
device, for every customer, at any time.
3. Core Components of the
StationDigital Platform Vision
Internet Broadcasting Company for Music, Music Videos, TV and Movies
Ad Supported Free to Consumer combined with a Direct Sale, Rental
and Subscription E-commerce Cloud Locker System
Provides a more user rich experience to consumers with more
metadata surrounding content then other providers
Highly curated playlists and recommendation & merchandising systems
Device agnostic and ubiquitous
Competitive Ad Publishing and bidding Platform for increased Ad
Publishing CPM rates
Digital Content controls a Massive Audience with the most time spent
watching and listening which allows SD to sell valuable ad real-estate
or merchandise products to them for increased profitability
GEO-IP Advertising
New Features like: Co-shopping with friends, Listen While you Shop,
Social Sharing/Recommendations
Loyalty and Rewards Program ā Allows Users to earn rewards just for
listening or watching which can then be redeemed for discounts in the
online store or for exchanging virtual currency with other partner apps
or stores.
4. Executive Summary
uļµāÆ StationDigital is a digital media broadcast platform, changing
the way consumers access and enjoy digital media
uļµāÆ StationDigital pioneered an industry first unique value
proposition - its SD Listener Rewards program
uļµāÆ StationDigitalās platform offers free music, music videos,
movies, and TV - and will soon offer eBooks and video games.
uļµāÆ Digital and physical merchandise in our superstore, with over
50 million items available - books, music, shirts, hats, posters
and more.
uļµāÆ Device agnostic and global - available on the web and also as
an iOS and Android app, covering 90% of the mobile market.
uļµāÆ Ad supported, free-to-consumer content, cloud locker with
subscription, rental and direct sales
uļµāÆ Enterprise class architecture with PCI compliance
5. Company Overview
uļµāÆ StationDigital launched in September, 2013
uļµāÆ Has already surpassed 5M unique listeners and 700,000 mobile
installs, primarily in iOS devices.
uļµāÆ Social media presence: 290,000 Facebook Likes, 242,000
Twitter Followers
uļµāÆ User acquisition focused primarily on SD mobile apps on iOS
and Android mobile devices, and planning to expand our
presence into the emerging markets of connected living rooms
and cars.
uļµāÆ Development contracts proceeding in 2014 with Apple TV,
Chromecast, Western Digital, Roku, Xbox, PlayStation, Ford
and Chrysler, and others.
6. A Newer, Better Platform
uļµāÆ Consumers are looking for a
platform that is all
encompassing, and provides
more than just music.
uļµāÆ Current market leaders are
structurally restricted by
their outdated systems.
uļµāÆ StationDigital is designed to
be free from limitations,
and versatile enough to
capitalize on growth
opportunities and capture
market share and brand
equity.
7. Milestones
uļµāÆ Over 700,000 mobile installs in just 4 months in Android and iOS
uļµāÆ Over 4.2 million unique listeners since launch
uļµāÆ In Top 5 Internet radio stations in iTunes in March and April 2014
uļµāÆ 55th cumulative worldwide most downloaded app
uļµāÆ Already ranked #5 most downloaded free music app on iTunes
8. Market Overview
uļµāÆ Itās a Great Time to Enter the Internet Broadcasting Market
uļµāÆ Part One -
uļµāÆ Content Acquisition
uļµāÆ Customer Acquisition Costs are Low while the appreciation of user value
continues to climb.
uļµāÆ Viral and Organic Growth continues to increase with internet social sharing
reducing acquisition costs
uļµāÆ Ad Publishing
uļµāÆ Interactive Advertising is worth much more than non-interactive legacy
terrestrial systems due to userās integrating and multi-tasking while using
online content distribution system.
uļµāÆ CPM Rates Continue to Climb for Interactive Advertising
uļµāÆ Licensing
uļµāÆ DMCA compliance is paving the way to allow increased profits for internet
broadcasting and allowing artists to make much more money
uļµāÆ Licensing Rights are now widely available for global coverage for digital
content
uļµāÆ Diminishing Advances and Minimum Guarantees for Digital Content Licensing
uļµāÆ Artists and Content Owners opt to publish direct to the internet to reduce
costs and profitability
9. Market Overview
uļµāÆ Itās a Great Time to Enter the Internet Broadcasting Market
uļµāÆ Part Two -
uļµāÆ Technology ā The stars have finally aligned to create an agnostic platform.
uļµāÆ HTML5 and Java have paved the way for a device agnostic global platform.
uļµāÆ Technology has sufficiently matured to allow for a truly ādevice agnosticā global
platform - with better curation, reduced overhead, and increased profitability.
uļµāÆ Infrastructure and broadband connections continue to be more widely available and
at lower costs - allowing for increased audience and lower cost of acquisition.
uļµāÆ Merchandising
uļµāÆ Ability to gather intelligence on users to dynamically change the user experience
based on user demographics and analytical data. Therefore you increase the
stickiness, retention and revenue per user since they are more engaged.
uļµāÆ Competitors
uļµāÆ Fragmented offerings are not what todayās multi-device consumer wants. Consumers
want complete portability of their content.
uļµāÆ It is highly resource and time consuming for our competitors to make changes to
legacy infrastructure and code with existing large user bases.
uļµāÆ Our competitors are penalized for change and innovation due to their userās inherent
resistance to change in experience. Every change creates user loss through attrition
and conflicts with their primary objective of increasing user retention quarter by
quarter.
10. Competition
Station Digital competes for listeners
with other content providers based on
the following:
uļµāÆOverall Quality of Experience
uļµāÆContent Relevance and Diversity
uļµāÆEase of Use
uļµāÆPrice
uļµāÆAccessibility
uļµāÆPerceptions of Advertising Load
ā¢āÆ We compete for listeners based on brand awareness, reputation,
value proposition, and visibility compared to other Internet radio
platforms and mobile consumer entertainment providers.
11. Competitors
uļµāÆ Other Radio Providers
ā¢āÆ Ex: Clear Channel, CBS, Sirius XM
uļµāÆ Other Internet Audio Content Providers
ā¢āÆ Ex: iTunes, RDIO, Spotify
uļµāÆ Other Media/Entertainment Platforms
ā¢āÆ Ex: Netfilx, Hulu, Vevo, YouTube
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12. Competitors
uļµāÆ Top ranked iTunes free music apps, by number of downloads, in order,
as of April 2014 - with some competitorās public market cap
valuations.
ā¢āÆ Pandora ā $5.89B
ā¢āÆ Spotify ā $7B
ā¢āÆ Soundcloud ā $700mm
ā¢āÆ Shazam ā $500mm
ā¢āÆ StationDigital - 55mm
ā¢āÆ iHeart Radio
ā¢āÆ Tunein Radio
ā¢āÆ Rdio
ā¢āÆ Songza
ā¢āÆ Slacker
All of these companies are between 4 and 10 years older than StationDigital
13. Advertisers
uļµāÆ StationDigital competes for advertisersā marketing budgets on the
basis of:
uļµāÆ Perceived return on investment
uļµāÆ Effectiveness and relevance of our advertising products
uļµāÆ Pricing structure
uļµāÆ Ability to deliver either large volumes or precisely targeted ads.
uļµāÆ Competition for Advertisers
ā¢āÆ Other Internet Companies
uļµāÆ Ex: Facebook, Google, Yahoo!
ā¢āÆ Traditional Broadcast Radio
uļµāÆ Ex: Clear Channel, Cumulus, CBS
ā¢āÆ Other Traditional Media Platforms
uļµāÆ Ex: Television (ABC, NBC, FOX),
uļµāÆ Print (New York Times, WSJ, FT)
14. Competitive Advantages
uļµāÆ StationDigital stands out from the competition by providing the
richest user experience, offering a unique combination of capabilities
from a single provider.
ā¢āÆ User defined listening
ā¢āÆ Playlists built based on similar artists
ā¢āÆ Live radio station broadcasting over the Internet
ā¢āÆ Purchase of physical and digital goods together in our online store
ā¢āÆ Music, movies, video games, software, eBooks, TV offered on StationDigital
uļµāÆ In addition, StationDigital offers, to all its registered users, a Listener
Rewards program.
ā¢āÆ This is our preeminent value proposition and competitive advantage - with
which we attract and retain customers, not only from the overall user
population for Internet radio, but specifically from the former users of our
competitors services
ā¢āÆ We reward our subscribers with ārewards pointsā for every hour they spend
listening to StationDigital and for every friend or co-worker they bring into the
StationDigital customer base
ā¢āÆ These rewards points can be used to buy attractive, music-centric merchandise
and apparel in our StationDigital online superstore
15. The Opportunity
uļµāÆ Total revenues generated by Internet radio services in 2013 are currently
estimated in excess of $1 Billion, and are forecast to be 3 times that by
2015
uļµāÆ Total advertising revenue generated in Internet radio increased by 56%
during the fiscal year ended January 31, 2013
uļµāÆ Advertising revenue in Internet radio on mobile and other connected
devices increased by 99% in 2013
*Measured in hundreds of millions of listener hours
For the past four years, ending in 2013, the
Internet radio market has grown at triple digit
rates.* This rate is widely forecasted to increase
through next three years.
The top 15 Internet radio services all grew
substantially, in both user numbers and revenues,
in 2013:
Pandora total rev. for 2011 = $137.8
Million
Pandora Total rev. for 2013 = $427.1
Million
16. The Opportunity
uļµāÆ StationDigital believes it has an opportunity to
compete for significant market share in this wide
open and expanding market
uļµāÆ Previous new entrants into this market have done
very well in terms of capturing market share
uļµāÆ Clear Channelās iHeartRadio, the second national brand
to achieve pre-eminent market share, surpassed 30
million registered users in less than two years after the
launch of its current version
uļµāÆ Spotify, SoundCloud, Rdio, Tune-in, Slacker, and Sound
Hound have all achieved prominent brand awareness,
large user bases, and high enterprise values
uļµāÆ StationDigital has risen into the top national tier of
Internet Radio stations in one tenth the time it took
any of those others to do so, and has already surpassed
all but three in mobile app downloads in 2014.
17. Vision
uļµāÆ Thereās a growing behavioral preference among advertisers for
Internet radio over traditional broadcast radio - as interactive v.
non-interactive advertising is showing greater retention and
action among listeners.
uļµāÆ Internet radio holds a demonstrated higher ceiling for brand and
message retention, consumer awareness, and marketing ROI.
uļµāÆ Internet radio offers an evolved customer engagement platform
with a superior value proposition for advertisers.
Internet radio ROI
18. How Weāll Grow
uļµāÆ Marketing partnership with Google drove over 4M unique
visitors in first months after launch.
uļµāÆ Marketing focus in 2014 is primarily on mobile device
listeners.
Marketing approaches:
!āÆ Direct Digital
Marketing
!āÆ Channel Partner
Marketing
!āÆ Viral and Organic
Growth
!āÆ Sponsorships,
Events and Indie
Artist Promotion
19. Management Team
Timothy Roberts ā CEO & Chairman
Ed Storm ā COO
Terrance Taylor - CFO (Interim) & Controller
David LaFrench ā CTO
Lucky Romero - VP, Business Development
Ā Ā Ā Ā
Infrastructure, Hosting, Software, Music Industry
and Digital Media, Finance, Accounting, Finance
and Technology Seasoned Experts.
20. Advisory Board
Kevin Bachus, Co-Creator of
Xbox, Dave & Busters
John W. Fanning, Founder of Napster,
NetMovies, NetGames, NetCapital
Brian Altounian, CEO of Wowio