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RealNetworks And Sony Form A Strategic Alliance

RealNetworks, Inc and Sony Corporation have made a strategic alliance agreement. In addition, Sony has also agreed to purchase a minority stake of about 1% in RealNetworks. These new agreements will enable the two companies to further collaborate on the deployment of various distribution and digital content software technologies to a wide range of Sony's industry leading digital devices.

The announcement builds on a more than two-year relationship between the two companies. Since a joint announcement at Winter CES 2000, RealNetworks and Sony Corporation have cooperated to integrate Sony technologies such as ATRAC3 sound compression format and OpenMG copyright protection technology with various RealNetworks' products including RealPlayer(R) and RealJukebox(R) and to promote the combined products to PC users, and to distribute the combined products with Sony hardware products. Today's announcement represents an extension of this existing technical relationship reflecting the rapid expansion in network distribution of digital audio and video content to personal computers and a new generation of networked consumer electronics products. Both companies are committed to working together to deploy easy-to-use solutions that will encourage the expansion of digital distribution business opportunities.

The agreement establishes a framework of regular product and business reviews for both companies to increase their collaboration on a number of initiatives including the further integration of Sony's ATRAC3 technology into RealNetworks' products, the adoption of RealNetworks' products into a wide variety of Sony's networked CE devices, and the enhancement of the compatibility of RealNetworks' software such as RealOne(TM) with Sony's portable audio players and OpenMG devices such as NetMD. In addition, consideration will be given to incorporating Sony's OpenMG technology into RealNetworks digital content distribution solution for digital music distribution and digital video distribution services. Sony plans to adopt these combined digital distribution solutions in a variety of networked CE products such as Sony's networked audio products and Sony Computer Entertainment's PlayStation(R)2 computer entertainment system


"Sony is extremely pleased to enhance the level of our technical collaboration with RealNetworks and to make an equity investment in order to expand business opportunities in relation to digital content distribution," said Mr. Kunitake Ando, President and COO, Sony Corporation. "With the power of RealNetworks' distribution software and its technical expertise, we are confident that this agreement will help make Sony's ATRAC3 and OpenMG an industry standard for digital content distribution."

"The alliance being announced today is an important step forward in what has already been a long-standing and fruitful relationship with Sony Corporation," said Mr. Rob Glaser, chairman and CEO, RealNetworks, Inc. "I look forward to continued close collaboration with Sony to make networked digital media a reality for hundreds of millions of consumers worldwide."

By combining Sony's experience in consumer electronics innovation and RealNetworks' cutting edge and market leading digital media software, both parties look forward to working together to offer consumers easy-to-use, secure digital content distribution solutions across both PC and non-PC formats.