Loop Media (LPTV) - 2020 Q4 - Annual Report

Revenue Performance - For the years ended December 31, 2020 and 2019, the company's revenues were $2,794,081 and $3,381,121, respectively, indicating a decline in revenue[29]. - The company has incurred significant fees and expenses, including non-cash items, and has an accumulated deficit, impacting its ability to generate sufficient cash flows from operations[29]. Product Development and Offerings - The company has developed the Loop Player, a proprietary streaming video player, which is offered for free to OOH businesses, eliminating the need for costly computer hardware[49]. - The introduction of the Ad-Supported Service is expected to provide more revenue over time compared to the previous Premium Service model, as it allows for advertising inventory to be filled[50]. - The Loop App, launched in mid-2020, has not experienced significant downloads due to the delayed full music video offering until December 2020, but has seen increased downloads in Mexico[54]. - The company has secured licenses with major music labels to distribute music videos, enhancing its content offerings for both OOH and D2C customers[38]. - The company currently has over 80 English language music video Playlists and 65 Spanish language music video Playlists available for users[42]. - The company aims to produce its own content in-house through Loop Music Studios, enhancing its content curation and distribution capabilities[41]. Market Expansion and Strategy - The company is exploring opportunities to expand its reach by securing licenses for other regions, including South America, Europe, and Asia[38]. - The company is primarily focused on the United States but is expanding its D2C businesses into Canada, Mexico, and potentially other South American countries, as well as parts of Europe and Asia[58]. - The company plans to increase marketing efforts targeting OOH venues, finding a direct correlation between online advertising spend and business sign-ups for its Loop Player[65]. - The company has launched its Loop App in Mexico and taken a non-controlling interest in EON Media, Inc. in Asia to expand its operations[66]. - The company is diversifying its customer base beyond hospitality to include smaller venues and non-traditional industries, enhancing its market reach[65]. Competition and Market Position - The company competes in the OOH market with small companies like Atmosphere and Stingray, focusing on price, technology, and quality content as key competitive factors[73]. - The company utilizes a bottom-up and top-down marketing approach for its OOH services, targeting both individual venues and large corporate clients[78]. Intellectual Property and Legal Considerations - The company has developed proprietary software and hardware, including its Loop Player, which is subject to patents[81]. - The company emphasizes the importance of intellectual property rights, relying on a combination of patents, copyrights, trademarks, and trade secrets to protect its proprietary technology[82]. - U.S. patent filings are intended to provide the holder with exclusive rights, but the company acknowledges that these patents may be contested or invalidated, impacting competitive advantages[83]. Financial Reporting and Compliance - The company is classified as a smaller reporting company and is not required to provide certain market risk disclosures[257].