MediaBay is “a digital media and publishing company specializing in the marketing of spoken audio entertainment” which is changing its business model from hard goods to digital downloads over both the internet and mobile networks. Sales plummeted last year: “For the year ended December 31, 2004, MediaBay reported sales of $18.8 million, down 49% from $36.6 million in 2003. Net loss for 2004 increased to
$30.7 million, or $1.71 per diluted common share, from $6.9 million, or $0.49 per diluted share, in 2003.” In fact, the company lost as much in the fourth quarter as it made in sales for the entire year. The change in strategy from mail-order to download cost the company a million dollars last year, but if it actually makes the company profitable it will be worth.
“The Company’s new distribution strategy is two pronged: (1) to wholesale its audio content to the leading music services and broadband companies on a white label basis, both domestically and internationally; and
(2) to operate its own downloadable content stores and subscription services which are intended be branded via partnerships with celebrities and corporate affiliates, each chosen specifically to reach the targeted demographics known to be interested in its content.”