ViewCast CEO David Stoner Issues Open Letter to Shareholders

PLANO, Texas, March 15 /PRNewswire-FirstCall/ --

Dear ViewCast shareholders:

On behalf of ViewCast I am pleased to provide this update on recent developments at ViewCast and share our views on our prospects in 2010.

2009 was a tough year by any measure. Like most companies, the economy impacted our business during the year as customers cancelled or delayed plans for business expansion or new media initiatives. We made the decision early in the economic down turn that we would use the crisis to our advantage. We continued to invest in product development, while implementing cost reductions in some areas and reorganizing our sales and operational infrastructure. Our aim was to make sure that ViewCast is positioned to accelerate sales as buying patterns return to normal levels. We believe this is now happening.

The environment and ViewCast have seen some important changes recently that indicate to us an inflection point and bear mentioning as we assess our business:

• We believe that our revenue hit bottom during the third quarter of 2009. We can now see evidence of increases in sales of all product lines taking hold, and expect that trend to continue for the rest of the year.  
• Since the inception of the streaming media market, ViewCast Osprey® video capture technology has set the pace for industry innovation and today it is one of the most widely deployed video capture platforms in the world with over 365,000 Osprey cards deployed. Our Osprey product line is renowned for world-class performance, reliability and versatility. We expect the recovery in Osprey sales, which began during the last half of 2009, to continue during 2010 as customers transition to the PCI Express-based Osprey 240e and Osprey 450e. Meanwhile, non-entertainment driven applications, including security and surveillance, distance learning, remote training and event coverage, are expected to fuel the adoption of SD, HD and multi-channel compatible Osprey cards.
• As consumer demand for HD Internet content continues to accelerate, the market opportunity for ViewCast's Osprey 700e HD is expanding. Attractive pricing for this product has amplified this increased demand, and we anticipate further growth as HD initiatives take hold and broadband networking providers deploy new, higher bandwidth services and technologies, as evidenced by recent announcements by Cisco and Google.
• ViewCast Niagara® encoder sales are also benefiting from the firming economy.  Our largest OEM customer has resumed orders in the first quarter of 2010, following six months of being dormant.  Based on its outlook for 2010, we expect robust sales from this customer throughout the year.
• We have recently hired a new VP of Sales, John Hammock.  John has 20 years of experience in business development and sales, having previously served in senior leadership positions with companies in global telecommunications, media and video markets.  While any new initiatives will take some time to hit full stride, John's energy, contacts and strategic thinking are already making their mark within the Company.

In addition, we have numerous programs that have or are set to launch that give us reason to believe we can achieve greater market share and growth opportunities in 2010:

• Our Niagara SCX® v6 software added industry-leading adaptive streaming of Adobe® H.264 Flash encoding capability during 2009 and extends in 2010 with adaptive HTTP streaming for Apple® iPhone ® mobile devices and other 2010 versions of new HTTP streaming initiatives from Microsoft® and Adobe. These new features planned for the first half of 2010 will further accelerate demand for our encoders. In addition, we will integrate our Niagara encoder into ViewCast's digital media management solution, resulting in broader capabilities for our customers.
• We will continue to expand our digital media management solution for comprehensive support for production of live video events as well as archived or on-demand content. Unlike other media management solutions, our offering accommodates a wide variety of media content types, including Microsoft® Office documents, Adobe Acrobat PDF files and image files, in addition to audio and video media. Our media management capabilities are highly scalable and can support the needs of any size enterprise. By adding ViewCast's industry-leading Osprey and Niagara IP video encoding solutions, we've created a wide-ranging framework available for building audiences, organizing workflows and creating new revenue streams in today's IP-centric digital media marketplace. We believe our digital media management suite of software will be an increasingly significant factor in our 2010 sales growth and beyond.
• ViewCast will continue to seek acquisition opportunities as part of our strategic plan to increase our product scope and market presence, expand our offerings to our OEM and channel partners, and accelerate our growth.  The 2009 acquisition of our digital media management platform has already expanded our presence well beyond live video streaming to address the broader market for the management and delivery of digital media content.

We appreciate your support as we embark on our next stage of growth. We look forward to giving greater detail on some of these programs on the fourth quarter call on March 31st and as 2010 progresses.

Sincerely,

David T. Stoner

President and CEO

About ViewCast  (OTC Bulletin Board: VCST)

ViewCast's award-winning solutions simplify the complex workflows required for the management and delivery of digital media, empowering broadcasters, businesses and governments to easily and effectively reach their audiences. ViewCast Niagara® streaming appliances, Osprey® video capture cards, and VMp™ media management solutions provide the highly reliable technology required to deliver the multi-platform experiences driving today's digital media market.

ViewCast, Osprey, Niagara and VMp are trademarks or registered trademarks of ViewCast Corporation or its subsidiaries.

Safe Harbor Statement

Certain statements in this release are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995 and reflect the Company's current outlook. Such statements apply to future events and are therefore subject to risks and uncertainties that could cause actual results to differ materially. Important factors that could cause actual results to differ materially from forward-looking statements include, but are not limited to, changes in market and business conditions, demand for the Company's products and services, technological change, the ability of the Company to develop and market new products, increased competition, the ability of the Company to obtain and enforce its patent and avoid infringing other parties' patents and changes in government regulations. All written and verbal forward-looking statements attributable to ViewCast and any person acting on its behalf are expressly qualified in their entirety by the cautionary statements set forth herein. ViewCast does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date on which the forward-looking statements are made. For a detailed discussion of these and other cautionary statements and factors that could cause actual results to differ from the Company's forward-looking statements, please refer to the company's reports on Form 10-K and 10-Q on file with the U.S. Securities and Exchange Commission.

SOURCE ViewCast Corporation