MBAY having a great day, up .20 to 1.29 on very good volume. MBAY is a great play on downloadable content, audio books, radio shows, etc. $40M in revs, earned .02 last quarter, and a nice release yesterday. Here's a past release that tells a lot about the company...
MediaBay Details Growth Strategies for 2004 and Beyond
January 07, 2004 09:06:02 (ET)
CEDAR KNOLLS, N.J., Jan 07, 2004 /PRNewswire-FirstCall via Comtex/ -- MediaBay, Inc. (MBAY, Trade), a leading spoken audio content, marketing and publishing company, today detailed the Company's strategies to drive revenue and earnings growth in 2004 and beyond.
"MediaBay is undergoing considerable changes and developing, testing and implementing many new initiatives. We believe these efforts merited updating the investment community about our strategies as we enter 2004," commented Carl Wolf, Chairman. "Our growth strategy can be summed up as a three-pronged approach. Increase the number of distribution channels selling our products. Expand the number of products we distribute through those channels. Increase the amount of our products each customer buys, namely by increasing the quality of customer as well as extending the customer life through various initiatives and customer retention strategies. We intend to utilize our assets to grow sales of existing products as well as develop new products, leveraging our direct marketing and wholesale distribution channels. We intend to develop new products internally and possibly through strategic acquisitions of direct marketing and consumer goods companies."
MediaBay identifies its leveragable assets to include:
-- An Internet distribution platform with significant traffic and sales -
Websites, which are among the most heavily trafficked bookselling web
sites on the Internet. The Company's Websites also serve streams of
our classic radio content and offers downloads of audio content to
website visitors at RadioSpirits.com and MediaBay.com.
-- Proprietary licenses & content - A proprietary content library,
consisting of more than 50,000 hours of spoken audio content, the
majority of which is acquired under license from the rightsholders.
-- Customer databases - A customer database, which includes approximately
three million spoken audio buyers and prospects most of whom have
purchased via Company catalogs and/or direct mail marketing, as well
as total database of approximately one million targeted e-mail
addresses.
-- Wholesale distribution - A wholesale distribution system that
distributes the Company's old-time radio products in over 7,000 retail
locations including Costco, Target, Sam's Club, Barnes & Noble,
Borders, Amazon.com, and Cracker Barrel Old Country Stores.
-- Direct marketing and product development knowledge and experience -
MediaBay's executive management team has over 40 years experience in
marketing products directly to consumers as well as developing new
products.
Additional Distribution Channels
"We have been actively evaluating, testing and developing new distribution channels," continued Mr. Wolf. "We are pursuing new retail relationships to sell our classic radio products in drug, gift and specialty stores, and specialty catalogs. Theses efforts are gaining initial success as demonstrated by our recently signing an agreement with a large book distributor to carry our classic radio products in independent bookstores. We are also focusing on opening additional sales channels such as truck stops, airport kiosks and other stores that specialize in product sales to travelers. Looking beyond traditional retailers, we are expanding our strategies to capitalize on the growing popularity of digital audio players such as MP3 players and iPods."
New Product Lines and Products Under Development
The Company is leveraging its library of old-time radio archives by repackaging its existing content into appealing collections.
MediaBay also continues to license of audiobooks of every genre, including non-fiction, fiction, self-improvement, mystery, fantasy, business, science fiction, biography, romance, religion, motivational and children's, among others. The following are examples of products, which have been successfully developed and are currently being marketed:
-- A mysteries and thrillers line of licensed fiction continuities
marketed to active and inactive Audio Book Club customers;
-- An Old-Time Radio continuity program marketed to Radio Spirits and
Audio Book Club databases and external prospects;
-- A downloadable old-time radio subscription service.
In addition, MediaBay recently obtained the exclusive rights to publish, duplicate, distribute and sell selected seminars by the Learning Annex, an adult continuing education school offering classes in areas such as personal improvement, healing, spiritual growth, media, and business. The 10-year agreement gives MediaBay the right to sell Learning Annex seminars in all wholesale and retail audio-book channels, representing a brand new product line with large potential for growth.
To capitalize on the growing popularity of digital audio players such as MP3 players and iPods, the Company continues offering much of its content for download over the Internet. MediaBay is actively reviewing growth strategies and distribution relationships to capitalize on the potential of the Internet. Currently, MediaBay's nationally syndicated radio program "When Radio Was" is streamed at www.radiospirits.com. For $19.95 a month, the Company offers subscribers the ability to download its library of radio programs. The Company also has just introduced a stream-only plan for $4.95 a month, and is continually evaluating product and pricing for delivery over the Internet.
Mr. Wolf commented, "We believe that access of our content through the Internet could be an important and growing source of revenue for us in the future. The downloading of both our old-time radio programs and ultimately our audiobook content is very important part of our strategy. The success of the I-Pod has made more people aware of the ease and convenience of downloading and as the market grows we believe we could be an important player. We have content, access to more content, the marketing knowledge to reach spoken word consumers and a database of almost 3.0 million names of spoken word consumers or enthusiasts."
Increasing Customer Quality, Customer Satisfaction and "Lifetime" of Customer
The Company employs sophisticated data mining techniques in order to analyze various segments of its current customer database, as well as every new customer that joins the Audio Book Club or other programs. The Company now has the ability to determine not only customer acquisition costs, but also what segments of customers (be it men from Minnesota or New Yorkers purchasing via Internet) are most profitable, and which customers are actually unprofitable and should be removed from the program. These tools have been instrumental in cross selling various promotions, analyzing response rates, as well as developing new product lines based upon the Company's findings. MediaBay uses these tools to be more responsive, and relevant to their customers, impacting how much they purchase, and how long they remain with the various clubs and programs. The Company is also testing various pricing schemes to determine elasticity of pricing and promotions, to best maximize revenues and profits. Taken as a whole, the Company believes these initiatives could significantly increase customer satisfaction, quality of the customer base as well as the longevity of relationships between MediaBay and its customers.
Additional Opportunities - Cost-Savings
Mr. Wolf concluded, "During the third quarter, we initiated cost reductions as part our restructuring initiative. We expect these efforts to yield annual general and administrative savings of approximately $1.4 million. While both Audio Book Club and Radio Spirits are profitable, we have opportunities to further reduce costs. We believe we can achieve substantial costs reductions by moving manufacturing offshore. We have changed our methods of processing return goods through the United States Post Office, which the Company believes could save up to $400,000 per year, and we are exploring moving the physical distribution of our products to higher quality and more economical facilities."
If the Company's strategy is successful, it expects the results of these initiatives to become evident beginning in the third quarter of 2004. However, the Company cannot offer assurance that its strategy will be successful or that sales will increase as expected, or at all, or that cost savings will be achieved.
About MediaBay, Inc.
MediaBay, Inc. (MBAY, Trade) is a media, marketing and publishing company specializing in spoken audio content, whose industry-leading businesses include direct response and interactive marketing, retail product distribution, media publishing and broadcasting. MediaBay's content libraries include over 60,000 classic radio programs, 3,500 film and television programs and thousands of audiobooks, much of which is proprietary. MediaBay distributes its products to its own customer database of approximately 3.0 million names and 2.2 million e-mail addresses, in over 7,000 retail outlets and on the Internet through streaming and downloadable audio. MediaBay is comprised of four subsidiaries - Audio Book Club, the leading club for audiobooks, Radio Spirits, the leading seller of classic radio programs, MediaBay.com, the Company's digital audio download service and RadioClassics, the leading distributor of classic radio content across multiple broadcast platforms including satellite and traditional radio. For more information on MediaBay's brands, products and financial information, please visit www.MediaBay.com.
"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: Certain statements in this press release constitute "forward-looking" statements that involve a number of known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any results, performances or achievements express or implied by such forward-looking statements. These risks and uncertainties, include, but not limited to, our history of losses; our ability to meet stock repurchase obligations, anticipate and respond to changing customer preferences, license and produce desirable content, protect our databases and other intellectual property from unauthorized access, pay our trade creditor and collect receivables; dependence on third-party providers, suppliers and distribution channels; competition; the costs and success of our marketing strategies; product returns; member attrition and other risks detailed in the Company's Securities and Exchange Commission filings. Undue reference should not be placed on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to update any forward-looking statements.
Contact:
Darren E. Barker John Levy, Chief Financial Officer
Investor Relations International MediaBay, Inc.
(818) 382-9706 (973) 539-9528
dbarker@irintl.com jflevy@mediabay.com
SOURCE MediaBay, Inc.
Darren E. Barker, Investor Relations International,
+1-818-382-9706, dbarker@irintl.com; or John Levy, Chief Financial Officer,
MediaBay, Inc., +1-973-539-9528, jflevy@mediabay.com
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