State of the Business
April 13th, 2014
5042 Wilshire Blvd | #26900 | Los Angeles, CA | 90036
StationDigital’s mission is to create the
Internet’s most content rich, consumer
essential, and experientially trendsetting
digital media broadcasting platform – one
that delivers the most consistent, robust,
and seamless experience across every
device, for every customer, at any time.
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
New Features like: Co-shopping with friends, Listen While you Shop,
Loyalty and Rewards Program – 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
u StationDigital is a digital media broadcast platform, changing
the way consumers access and enjoy digital media
u StationDigital pioneered an industry first unique value
proposition - its SD Listener Rewards program
u StationDigital’s platform offers free music, music videos,
movies, and TV - and will soon offer eBooks and video games.
u Digital and physical merchandise in our superstore, with over
50 million items available - books, music, shirts, hats, posters
u Device agnostic and global - available on the web and also as
an iOS and Android app, covering 90% of the mobile market.
u Ad supported, free-to-consumer content, cloud locker with
subscription, rental and direct sales
u Enterprise class architecture with PCI compliance
u StationDigital launched in September, 2013
u Has already surpassed 5M unique listeners and 700,000 mobile
installs, primarily in iOS devices.
u Social media presence: 290,000 Facebook Likes, 242,000
u 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
u Development contracts proceeding in 2014 with Apple TV,
Chromecast, Western Digital, Roku, Xbox, PlayStation, Ford
and Chrysler, and others.
A Newer, Better Platform
u Consumers are looking for a
platform that is all
encompassing, and provides
more than just music.
u Current market leaders are
structurally restricted by
their outdated systems.
u StationDigital is designed to
be free from limitations,
and versatile enough to
capitalize on growth
opportunities and capture
market share and brand
u Over 700,000 mobile installs in just 4 months in Android and iOS
u Over 4.2 million unique listeners since launch
u In Top 5 Internet radio stations in iTunes in March and April 2014
u 55th cumulative worldwide most downloaded app
u Already ranked #5 most downloaded free music app on iTunes
u It’s a Great Time to Enter the Internet Broadcasting Market
u Part One -
u Content Acquisition
u Customer Acquisition Costs are Low while the appreciation of user value
continues to climb.
u Viral and Organic Growth continues to increase with internet social sharing
reducing acquisition costs
u Ad Publishing
u Interactive Advertising is worth much more than non-interactive legacy
terrestrial systems due to user’s integrating and multi-tasking while using
online content distribution system.
u CPM Rates Continue to Climb for Interactive Advertising
u DMCA compliance is paving the way to allow increased profits for internet
broadcasting and allowing artists to make much more money
u Licensing Rights are now widely available for global coverage for digital
u Diminishing Advances and Minimum Guarantees for Digital Content Licensing
u Artists and Content Owners opt to publish direct to the internet to reduce
costs and profitability
u It’s a Great Time to Enter the Internet Broadcasting Market
u Part Two -
u Technology – The stars have finally aligned to create an agnostic platform.
u HTML5 and Java have paved the way for a device agnostic global platform.
u Technology has sufficiently matured to allow for a truly “device agnostic” global
platform - with better curation, reduced overhead, and increased profitability.
u Infrastructure and broadband connections continue to be more widely available and
at lower costs - allowing for increased audience and lower cost of acquisition.
u 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.
u Fragmented offerings are not what today’s multi-device consumer wants. Consumers
want complete portability of their content.
u It is highly resource and time consuming for our competitors to make changes to
legacy infrastructure and code with existing large user bases.
u Our competitors are penalized for change and innovation due to their user’s 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
Station Digital competes for listeners
with other content providers based on
u Overall Quality of Experience
u Content Relevance and Diversity
u Ease of Use
u Perceptions of Advertising Load
• We compete for listeners based on brand awareness, reputation,
value proposition, and visibility compared to other Internet radio
platforms and mobile consumer entertainment providers.
u Other Radio Providers
• Ex: Clear Channel, CBS, Sirius XM
u Other Internet Audio Content Providers
• Ex: iTunes, RDIO, Spotify
u Other Media/Entertainment Platforms
• Ex: Netfilx, Hulu, Vevo, YouTube
The image part with relationship ID rId10 was not found in the
u Top ranked iTunes free music apps, by number of downloads, in order,
as of April 2014 - with some competitor’s public market cap
• Pandora – $5.89B
• Spotify – $7B
• Soundcloud – $700mm
• Shazam – $500mm
• StationDigital - 55mm
• iHeart Radio
• Tunein Radio
All of these companies are between 4 and 10 years older than StationDigital
u StationDigital competes for advertisers’ marketing budgets on the
u Perceived return on investment
u Effectiveness and relevance of our advertising products
u Pricing structure
u Ability to deliver either large volumes or precisely targeted ads.
u Competition for Advertisers
• Other Internet Companies
u Ex: Facebook, Google, Yahoo!
• Traditional Broadcast Radio
u Ex: Clear Channel, Cumulus, CBS
• Other Traditional Media Platforms
u Ex: Television (ABC, NBC, FOX),
u Print (New York Times, WSJ, FT)
u StationDigital stands out from the competition by providing the
richest user experience, offering a unique combination of capabilities
from a single provider.
• User defined listening
• Playlists built based on similar artists
• Live radio station broadcasting over the Internet
• Purchase of physical and digital goods together in our online store
• Music, movies, video games, software, eBooks, TV offered on StationDigital
u In addition, StationDigital offers, to all its registered users, a Listener
• 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
• We reward our subscribers with “rewards points” for every hour they spend
listening to StationDigital and for every friend or co-worker they bring into the
StationDigital customer base
• These rewards points can be used to buy attractive, music-centric merchandise
and apparel in our StationDigital online superstore
u 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
u Total advertising revenue generated in Internet radio increased by 56%
during the fiscal year ended January 31, 2013
u 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,
Pandora total rev. for 2011 = $137.8
Pandora Total rev. for 2013 = $427.1
u StationDigital believes it has an opportunity to
compete for significant market share in this wide
open and expanding market
u Previous new entrants into this market have done
very well in terms of capturing market share
u Clear Channel’s 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
u Spotify, SoundCloud, Rdio, Tune-in, Slacker, and Sound
Hound have all achieved prominent brand awareness,
large user bases, and high enterprise values
u 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.
u There’s 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.
u Internet radio holds a demonstrated higher ceiling for brand and
message retention, consumer awareness, and marketing ROI.
u Internet radio offers an evolved customer engagement platform
with a superior value proposition for advertisers.
Internet radio ROI
How We’ll Grow
u Marketing partnership with Google drove over 4M unique
visitors in first months after launch.
u Marketing focus in 2014 is primarily on mobile device
! Direct Digital
! Channel Partner
! Viral and Organic
Events and Indie
Timothy Roberts – CEO & Chairman
Ed Storm – COO
Terrance Taylor - CFO (Interim) & Controller
David LaFrench – CTO
Lucky Romero - VP, Business Development
Infrastructure, Hosting, Software, Music Industry
and Digital Media, Finance, Accounting, Finance
and Technology Seasoned Experts.
Kevin Bachus, Co-Creator of
Xbox, Dave & Busters
John W. Fanning, Founder of Napster,
NetMovies, NetGames, NetCapital
Brian Altounian, CEO of Wowio