Digital Video Systems, Inc.

Ticker: DVID		2710 Walsh Avenue
Exchange: NASDAQ-Small Cap Market		Santa Clara, California 95051
Industry: Manufacturing		(408) 748-2100

Type of Shares:	Common Shares	Filing Date:	3/20/96
U.S. Shares:	4,200,000	Offer Date:	5/9/96
Non-U.S. Shares:	0	Filing Price:	$5.00
Primary Shares:	4,200,000	Offer Price:	$5.00
Secondary Shares:	0	Gross Spread:	$0.30
Offering Amount:	$21,000,000	Selling:	$0.10
Expenses:	$1,455,500	Reallowance:	$0.05
Shares Out After:	16,158,572

Manager	Tier	Phone
D.H. Blair & Co Inc.	Lead Manager	(212) 495-4000

Auditor: Ernst & Young
	Audited Income	Latest Unaudited Income	Prior Unaudited Income		Balance Sheet
	12/31/95				12/31/95
Revenue:	$3.52			Assets:	$2.97
Net Income:	-$4.48			Liabilities:	$0.92
EPS:	-$0.85			Equity:	$2.05
Note: Dollar amounts are in U.S. millions; Audited figures expressed as full year, unaudited figures are partial year

Business Description

The company develops, manufactures and markets digital video compression and decompression hardware and software for entertainment, business and educational uses. These products are integrated into CD video players and karaoke video players. The Company's current primary focus is on the manufacturing and marketing of a digital video compact disc ("Video CD") player incorporating the Company's technology primarily for consumer and commercial entertainment applications. The Company markets its Video CD players mainly in China and Taiwan. Unlike analog formats, such as video tape, digital video however can be compressed which allows for increased storage capacity and transmission efficiencies as well as the ability to reproduce and transmit video images without perceptible image degradation. Digital video also permits superior editing capabilities because of its greater compatibility with computers.

Use of Proceeds

The proceeds from the offering will be used to repay bridge notes, to acquire inventory, for sales and marketing and for working capital.

Last updated: 10/28/96