Creating Business Opportunities in Digital Music and Movies through Digital Watermarking Technology

Viable Business Models are being Created by Companies such as Philips, USA Video Interactive Corp., and Verimatrix, through Innovations in Content Protection

POINT ROBERTS, WA and DELTA, BC – June 19th, 2007– DigitalMediaStocks.com, an investor and industry news and research portal for the digital media sector, reports on how rising levels of music and movie piracy are creating viable business models for digital watermarking technology providers. Turning content protection challenges into market opportunities through digital watermarking across music, movies, and Pay TV, are companies such as Philips (NYSE: PHG), USA Video Interactive Corp. (OTCBB: USVO; TSX: US.V) and Verimatrix.

The content industry has struggled to keep up with the Internet, which has changed the way that people view and share media. The music industry, which had to deal heavily with the problem of piracy as the Internet gained in popularity, was taken by surprise and appeared unprepared to handle the flood of pirated music being distributed. The industry has now evolved and has taken steps to curb the problem; part of the music industry’s solution has been the use of watermarking.

Mr. Reed Stager, Chairman of the Digital Watermarking Alliance, describes, “Digital audio watermarking has been deployed in conjunction with licensed DVD-audio implementations to prevent playback of unauthorized copies. Most pre-release music of major artists from the main music labels carry media serialization watermarks in the music tracks that can help them identify leaks prior to the release of an album.”

Despite the efforts by the music industry, many feel that the main focus has shifted to digital video now that broadband speeds have made distribution feasible, fast and as a result, popular.

As a result, several technology firms have turned their attention to developing and implementing innovative watermarking solutions.

Philips (NYSE: PHG) broad content identification product portfolio is used for content monitoring, forensic tracking, rights clearing, copy protection and interactive applications throughout the movie creation and distribution chain; CompuTrack is used by major Hollywood Studio’s for protecting their valuable pre-release content, CineFence is already deployed in thousands of digital cinemas, and VTrack forensic watermarking provides additional protection to high value content in PayTV applications. Moreover, Philips has introduced a service platform called MediaHedge that enables content owners and internet websites to monitize new video distribution business models.

USA Video Interactive Corp’s (OTCBB: USVO; TSX: US.V) MediaSentinel product is an integrated anti-piracy device for use in modern video production environments that uses SmartMarks, invisible forensic information which is embedded into every video frame without compromising video quality. The Company has also developed MediaEscort, a software application specifically designed for content distributed via the Internet and is working closely with a major Hollywood studio to implement this technology.

Watermarking is also finding a market within Pay TV applications through companies like Verimatrix. The Verimatrix VideoMark™ is a secure and invisible content tracking solution that enables forensic, user-specific marking of analog video at each PC or set-top box client in a pay-TV system.

The full report is available at: http://www.digitalmediastocks.com/Articles/061907a.asp

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