DSNY - The Doppler Report
Initiates Investment Coverage With A Buy Recommendation for:
Destiny Media Technologies, Ltd. (?DSNY? ? Pink Sheets)
950 ? 555 West Hastings Street, Vancouver, British Columbia V6B 4N4
Phone: (605) 609 7736 Fax: (604) 609 - 0611
Toll-Free: (800) 8 - DESTINY
Website: destiny-software.com
DSNY?s revolutionary new MPE format (which combines e-commerce with secure MP3 audio) solves the security and piracy concerns that have kept mainstream record labels and major artists from aggressively marketing / distributing music in digital formats on-line
We Expect Destiny Media Technologies to Receive Fully-Reporting Status and Advance to the OTC-BB Within Six to Eight Weeks, With A Corresponding Increase in Investor Awareness and Interest
DESTINY?s MPE FORMAT IS THE NEW STANDARD FOR DIGITAL MUSIC
Destiny Media Technologies Ltd. (?DSNY? on Pink Sheets) has just introduced its new MPE format, a secure digital music distribution system that incorporates graphics, text and e-commerce applications. An MPE file does not require a player as it plays itself.
MPE features state-of-the-art encryption to protect content while delivering the high fidelity audio that consumers associate with MP3 music files. How it works is that a ?key? locks each music file to the purchaser?s specific computer and/or hardware device; in this way, when files are shared, the recipient can still preview the track, but needs to purchase their own key in order to ?unlock? and enjoy the entire MPE.
When a consumer clicks on an MPE, it pops open a window and plays a ?teaser?. If they click on the ?purchase? button, it automatically debits credits from a digital wallet. Destiny acts as the clearing house and distributes royalties to the originating web site and the various copyright holders.
MPE music files will be playable on both portable platforms as well as computers, and capable devices will be able to display the embedded text and graphics (depicting CD covers, credits, lyrics, advertising, etc.), all of which combines to make the new MPE format a much more effective promotional vehicle than any other currently-available distribution technology. Each MPE will also provide direct web links for the content?s provider web site, as well as a direct order URL for e-commerce and other promotions.
Quite simply, MPE is an extremely powerful sales tool that will allow record labels to distribute content digitally without fears of rampant piracy. We anticipate that Destiny?s MPE will be rapidly adopted by all of the major record labels and content owners as the new international standard for digital music distribution.
Why?
Because Destiny?s MPE format puts the control and revenue of music on the web back in the hands of the artists and labels. While the MP3 format has given independent musicians exposure to potential listeners and purchasers, the potential for piracy has made many major records and recording artists wary of using the popular MP3 format.
WHAT IS DESTINY MEDIA TECHNOLOGIES ALL ABOUT?
Since 1991, Destiny Media Technologies has been developing proprietary video and audio compression formats for the entertainment market. This company of experienced and innovative Internet software developers has now leveraged their expertise to stream audio and video over the Internet.
Destiny began researching audio streaming technology in 1996, and is now marketing a number of streaming audio products using their proprietary streaming media format .dny, as well as the recently introduced MPE format. The Company?s objective is to become the leading provider of accessible and consumer-friendly Internet audio technologies and applications.
Destiny's .dny format is an MP3-type audio compression format that allows users to download audio and video tracks and save them on their computer or portable player; the files are very small and provide near CD-quality playback. The .dny format is also being used to deliver real-time streaming media such as Internet radio, as well as real-time distribution of digital files.
Destiny?s current line of accessible and cost-effective enabling technologies for online media streaming include the Destiny Media PlayerTM, the world's smallest and most versatile digital music player and Internet radio receiver; RadioDestiny BroadcasterTM software for personal and commercial Internet radio broadcasting; the Radio Destiny Broadcast NetworkTM, a network of eclectic personal radio webcasters; and ClipStreamTM, a streaming audio clip tool that plays sound instantly on any java-enabled browser.
For investors seeking additional information on the Company, DSNY?s discussion threads on Raging Bull and SI can be accessed at: ragingbull.com and Subject 29418, respectively.
FUTURE GROWTH WILL COME FROM LICENSING DSNY?s RICH-MEDIA, SECURE MPE FORMAT
Licensing deals involving Destiny?s MPE format should provide solid growth and revenues in the months and years to come. One major deal has already been completed, and the Company has advised us that at least one more significant licensing agreement is close to being signed and announced.
In January, Destiny announced a working agreement with SongBoy, Inc. (a Nintendo Gameboy cartridge manufacturer) to license Destiny's rich media, secure MP3 format (MPE). Terms of the agreement call for Destiny to license their proprietary MP3 format for use in the SongBoy? portable GameBoy? module. Destiny will also create, manage and operate the SongBoy? website, which will provide for the download of digital music files and secure e-commerce transactions for the sale of digital music and related merchandise.
The SongBoy? is a digital multimedia player utilizing the Nintendo GameBoy? unit currently owned by more than 80 million people worldwide. GameBoy? owners can simply plug in SongBoy's module to access and play MP3s, the most widely distributed digital music format available today. The SongBoy? will have a simple menu with CD-like controls (play, stop, forward, etc.) and all the necessary software to convert a personal music library to digital audio files, which can be downloaded to the player. Users will also be able to download music directly from the SongBoy? website: songboy.com.
Bottom-line, the SongBoy? will transform the GameBoy? into a full-featured MP3 player similar to the Diamond Rio?, but with the key differential of a visual display screen. As the music plays, images (album covers, song lyrics, etc.) and advertising will show in the GameBoy Color? screen. The SongBoyTM will be available for purchase on-line at SongBoy.com for an estimated US$79; product delivery should begin as early as April 2000.
We can expect similar agreements to be struck with other hand held devices such as Palm Pilot type products portable game devices or even cellular phones.
CLIPSTREAM ? A REVOLUTIONARY STREAMING AUDIO TOOL FOR THE INTERNET
In February 2000, Destiny released version 2.0 of ClipStreamTM, a Java-based product for adding streaming audio to web pages.
Until now, audio-enabled web pages have been rare because users were required to download and install a player plug-in from Real Networks (NASDAQ: RNWK) or Microsoft (NASDAQ: MSFT). Because ClipStreamTM is Java-based (as are over 90% of the browsers in use today), it is embedded directly into the page (similar to a graphics file). ClipStreamTM is much simpler for the end-user, and does not require a player window to be launched, which would obscure the web page content.
What ClipStreamTM does is convert WAV, MP3 and CD audio files into a highly-compressed format that can be streamed across the Internet to web site visitors without the use of any special plug-in or player. To do this, ClipStreamTM used a small Java applet that is compatible with most Java-enabled browsers.
The result is true streaming audio files that play as they download, allowing the delivery of unlimited length audio. ClipStreamTM automatically optimizes audio files into two versions: one, for modems up to 56K, and a second compressed file for ISDN or better connections, and then automatically determines which version to deliver to web site visitors.
No programming knowledge is necessary to use ClipStreamTM - the user simply chooses the desired audio clip, drags and drops it through the ClipStreamTM compressor utility, and cuts and pastes the auto-generated code into the Web page. Only a 28kb download, ClipStreamTM is PC and Mac OS compatible, and is available at clipstream.com for US$99.
ANYONE CAN BROADCAST AS AN INTERNET RADIO STATION WITH RadioDestiny BroadcasterTM
Introduced in July 1999, RadioDestiny (http://www.RadioDestiny.com) is an Internet radio and digital music distribution system and broadcasting software package based on Destiny's proprietary compression and streaming technology.
There are currently more than 10,000 broadcasters registered on the RadioDestiny Broadcast NetworkTM, a 24/7 network of independent Internet Radio stations using Destiny?s free broadcast software, the RadioDestiny BroadcasterTM. With stations operating in every corner of the world, producing a variety of formats and reachable throughout the Internet, the RadioDestiny Broadcast NetworkTM is a tremendous marketing and communications tool.
The free RadioDestiny BroadcasterTM software allows non-technical users with a minimum of equipment (PC or Mac computer, sound card, microphone and access to the Web) to broadcast their own live (or scripted) Internet radio programs that can be received by anyone with the Destiny Media PlayerTM installed. This application is aimed at the beginner to professional studio. Easily installed, the software is not CPU intensive, and users can be broadcasting within minutes of finishing the setup
Users have the option of broadcasting live over the Internet or pre-recording programs to broadcast automatically. RadioDestiny BroadcasterTM streams compressed audio that can be listened to on any modem from a 28.8 kbps and up with no special servers or other software required.
Destiny Media PlayerTM ? THE WORLD?S SMALLEST, MOST-POWERFUL & VERSATILE DIGITAL MUSIC PLAYER
In December 1999, Destiny debuted its next generation Destiny Media Player?, the first digital music player incorporating Internet radio which includes visual, graphic and artist information and an instant purchase option for CDs or digital music files.
This powerful new application takes advantage of the wave of new music and broadcasting technologies sweeping the Internet: the MP3 compressed music format and Destiny?s proprietary web-based radio broadcasting technology. The Destiny Media Player? allows you to play MP3 files and listen to a growing number of web-based radio stations broadcasting on the RadioDestiny Broadcast Network?, all using the familiar home stereo interface. Switching between the Destiny Media Player? (MP3 mode) and Destiny Media Player? (Radio mode) is a single mouse click away.
The Destiny Media PlayerTM plays MP3, streaming MP3 radio such as Shoutcast, .wav and wmf files, MIDI, MPEG video, .AIFF, .snd, and audio CDs, all using the familiar and easy to use home stereo style interface. In Radio mode, the Destiny Media PlayerTM can also receive broadcasts from the RadioDestiny Broadcast NetworkTM. It finds media files on your computer with a library builder and allows you to browse by file name, without needing to know where you put your latest download. The Destiny Media PlayerTM also dynamically lists all live RadioDestinyTM broadcasters.
"The new Destiny Media PlayerTM allows users to 'listen, look and buy', and provides a virtual storefront for radio broadcasters, musicians and record labels," explains Ed Kolic, chief operating officer of Destiny Media Technologies. "This technology is one-of-a-kind and presents excellent opportunities to content owners, artists and retailers alike."
In addition to listening to music files and Internet radio, the next generation Destiny Media PlayerTM contains a powerful e-commerce feature that allows users to search, purchase and download CDs or digital tracks. Even with these new functions, the Destiny Media PlayerTM remains the world's smallest and most versatile digital music player and Internet radio receiver at just under 400k to download on a PC. The Mac version is just under 800k.
Destiny Media PlayerTM is available free from Destiny's Web site as well as partner sites such as music.tucows.com and mp3.com. Despite its many convenient and powerful features, this player is only a 400k download for the PC version and less than 800k for the Mac version.
SOME REASONS WHY YOU SHOULD CONSIDER ADDING DESTINY TO YOUR PORTFOLIO
We view the recently announced America Online (NYSE: AOL) and Time Warner (NYSE: TWX) merger as a very positive event for companies such as Destiny.
We believe that Time Warner AOL will greatly accelerate the development of the Internet from a text-based world to a broadband platform that can effectively offer television-like video and music streaming. In such a world, products such as the Destiny Media PlayerTM, RadioDestiny BroadcasterTM and ClipStreamTM are going to be valuable and will likely garner solid shares of their respective markets.
Since announcing the SongBoy? deal with Nintendo in January, Destiny has been inundated with media coverage as well as inquiries from businesses and investors. The company is solid, with strong fundamentals, a negligible float and a suite of state-of-the-art audio / video compression, streaming and broadcasting products.
Once Destiny?s Form 10-SB is approved by the SEC, we would expect to see much more upward pressure on the stock than has been the case so far. Some astute investors, obviously, are beginning to figure this deal out, but we believe that a large portion of the potential audience won't buy this stock while it?s on the pinks. Our understanding is that it?s just a matter of time until the OTC-BB listing is received, and that it won?t be too much longer after that that the SongBoy? will begin shipping.
We are very comfortable with the core competencies and track records of both Destiny?s management team and the independent directors, and are comfortable that this group can execute their business plan. Each of the core products are in high demand, and gaining market share in direct competition with some very powerful competitors (such as Microsoft), and there is a reasonable potential that one or more of these products might be spun off at a future date.
DESTINY MEDIA TECHNOLOGIES SHARE STRUCTURE & RECENT TRADING RANGE
Total Shares Outstanding: 21,501,000
Public Float: Est?d @ 5,000,000 shares
52-week Trading Range: US$0.55 (low) by US$4.00 (high)
Last Trade (March 6, 2000): US$3.90
For a current stock quote, investor relations information or stock charts, please visit: destiny-software.com
On November 23rd, 1999 Destiny filed a Form 10-SB registration with the U.S. Securities & Exchange Commission (SEC) to become a fully reporting company. This filing is available for viewing at: freeedgar.com. We understand that the SEC has recently returned their comments, and that management?s expectations are that full SEC approval and Destiny?s elevation to the OTC-BB should come by the end of March.
Destiny?s Officers and Directors collectively held about 28% of the stock, with DSNY?s President, Steve Vestergaard, controlling 25%.
Long-term debt is negligible (Cdn$218,574) ? most of which is due and payable during FY 2001 and 2002 (August 31st year end). A US$1,000,000 private placement financing was completed in February; the proceeds will be used to fund further product development and an initial marketing launch of Destiny?s new proprietary digital music distribution format (MPE).
For more information, please contact:
Investor Relations Department
destiny-software.com
DISCLAIMER ? PLEASE READ
The Doppler Report (the ?Publisher?) is not a Registered Investment Advisor or a Broker / Dealer. Readers are advised that this report is issued solely for information purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy. Reproduction of this report, in whole or in part, by any means, electronic or otherwise, including via the Internet, without prior written permission, is strictly prohibited.
The Doppler Report has independently prepared this report, drawing upon a range of public news and information sources, as well as data and opinions provided by Destiny Media Technologies, Ltd. (?DSNY? or the ?Company?). Prior to publication of this report, the Company reviewed and approved the contents hereof. The Publisher has not independently verified the Company?s representations. Any opinions expressed in this report are statements of judgment as of the date of publication (6 March 2000) and are subject to change without further notice, and may not necessarily be reprinted in future publications or elsewhere. Neither the Publisher nor its owners, employees or consultants accept any liability whatsoever for any direct or consequential loss arising from any use of this report or its contents.
The information contained herein is not intended to be used as the sole basis of any investment decisions, nor should it be construed as advice designed to meet the investment needs of any particular investor. The opinions and analysis included herein are based on sources believed by the Publisher to be reliable and in good faith but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or correctness. The foregoing discussion also contains forward-looking statements that are based on current expectations and differences can be expected. The information and opinions contained herein is not intended to be a complete discussion of information regarding some of the current and/or intended business activities of the Company, and all information contained in this report should be independently verified with the Company. Readers are urged to consult with independent financial advisors with respect to an investment in the shares mentioned herein. Investors should review a complete information package on the Company which should include, but not be limited to, the Company's annual report, quarterly report, press releases, as well as all regulatory filings.
In order to be in full compliance with the Securities Act of 1933, Section 17(b), the Publisher advises its readers that it has received a fee of 750 common shares of DSNY from Instant Digital Printing as compensation for its efforts in researching, writing and presenting the information contained herein. The Publisher, its owners, employees and consultants may profit in the event the shares of the Company increase in value. These positions may be liquidated from time to time even after Publisher, its owners, employees and consultants have made positive comments regarding the Company.
THE READER SHOULD VERIFY ALL CLAIMS AND DO THEIR OWN DUE DILIGENCE BEFORE INVESTING IN ANY SECURITIES MENTIONED. INVESTING IN SECURITIES IS SPECULATIVE AND CARRIES A HIGH DEGREE OF RISK. INVESTORS MUST ALSO INDEPENDENTLY VERIFY THE ?BLUE SKY? ELEGIBILITY OF THE SECURITY MENTIONED IN THIS REPORT BEFORE MAKING ANY INVESTMENT DECISIONS. TIMING OF, AND ANY BUYING OR SELLING DECISIONS, ARE THE SOLE RESPONSIBILITY OF THE READER.
The Publisher encourages U.S. readers to review the investing information available with the Securities and Exchange Commission ("SEC") at sec.gov and/or the National Association of Securities Dealers ("NASD") at nasdr.com The NASD has published information on how to invest carefully at its website. DSNY is not yet a fully reporting company with the SEC, having just filed its Form 10-SB registration statement with the SEC on November 23, 1999. Readers can review Destiny?s SEC filing at freeedgar.com and searching the EDGAR database.
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