Aeon Digital Along with Petters Group/Polaroid Unveils First of Its Kind Ethernet Enabled DVD/CDR-W Player/Recorder at International CES 2003.

Business Editors & High-Tech Writers

2003 International CES

LAS VEGAS--(BUSINESS WIRE)--Jan. 10, 2003

New Device, Featured in Bill Gates' Keynote,

Uses Microsoft's Windows Media 9 Series Playback and Recording

Aeon Digital Corp., a privately owned company, along with the Petters Group, has launched the first DVD/CDR-W player/recorder with Polaroid(R) to include a TV Tuner and is Ethernet ready. The high end DVD unit incorporates Microsoft Corporation's (Nasdaq:MSFT) Windows Media 9 Series playback and encoding allowing the consumer the capability to do more than just play DVD movies. The new unit will allow consumers the ability to both view and listen to Windows Media 9 Series streaming video and music content found on the Internet. The built-in TV tuner will enable consumers the ability to record up to 2 hours of their favorite television show or home video to CDR-W and gives them the capability of affordably recording digitally today.

The dual player targets 3 market segments: DVD Player, Digital Recording and Broadband Entertainment.

Aeon Digital's announcement comes on the heels of Bill Gates' keynote speech (CES, Jan. 8, 2003) which featured the Polaroid(R) Player prototype containing the Aeon Digital hardware set in Gates' address to discuss the future of Home Entertainment. Aeon Digital's hardware set was designed around the robust feature set of Microsoft Windows Media 9 Series.

This new device will enable the player to record and play back to CDR-W 2 hours of digital content.

The player is Ethernet ready and enables consumers the ability to stream Windows Media 9 Video content from the Internet onto their television using a cable modem or DSL. Consumers can also transfer their favorite family home movies from their camcorders to view and record and save for a lifetime on a digital format. Sleek and sophisticated, Aeon Digital's high-end player will be available at an extremely affordable price for the consumer to play, record, download and burn unlimited digital content.

Giovanni D'Andrea, CEO of Aeon Digital Corp. states, "Aeon Digital is the first company to license out a hardware set that encompasses Windows Media 9 Video encoding. We are thrilled to be working with Microsoft to deliver the Next Generation in DVD players to the consumer. We're extremely pleased that Polaroid(R) has chosen to license our player for distribution in North America. As more and more consumers bring broadband into their homes the bandwidth will no longer be dedicated just for their home computer but will be utilized in the living room via the family home entertainment center. Using Microsoft's Windows Media 9 Video, the future of digital home entertainment is here today. We're giving consumers a device where they can truly take advantage of the Internet."

Petters Group announced a new line of Polaroid(R) brand consumer electronics at CES and has licensed Aeon Digital's Next Generation DVD Hardware set for use within their new DVD-DVR 700(TM). The Polaroid unit will begin to enter the consumer marketplace toward the later half of 2nd Quarter 2003.

"This is a great example of the kind of new devices Windows Media 9 Series can now help enable," said Dave Fester, general manager, Windows Digital Media Division. "Aeon Digital has achieved an exciting milestone in the home entertainment marketplace by helping to bring Windows Media content into the living room."

Consumers who purchase an Aeon Digital powered unit will have the ability to stream selected content from featured partners such as CinemaNow.com straight to their television. Aeon Digital is working with CinemaNow.com, the leader in IP-based video-on-demand distribution and technology, to deliver film trailers and short films.

"Aeon Digital is pioneering the effort to stream Internet content into the living room for the growing content-on-demand market," said Curt Marvis, CEO of CinemaNow. "As leaders in Internet video-on-demand distribution, we look forward to working with them to bring our content to the television."

The Aeon Digital OEM hardware set features a dual tray design:

Aeon Digital Hardware Set Player Features

-- DVD player (SVCD, VCD, CD, MP3, WMV9)

-- CDR-W Burner capable of recording: WMV9 - 120 minutes; VCD - 80 minutes; SVCD - 40 minutes

-- Programmable TV Tuner with Timer

-- Ethernet Port (Direct Internet Connection)

You will be able to see the Aeon Digital Hardware Set in action at the Polaroid Booth (LVCC - #16625) during CES 2003. Microsoft Booth (LVCC - South Hall 3 & 4 #29296, LVCC - Center Hall 1 & 2 #6820).

About Aeon Digital Corp.

Aeon Digital Corp. is a privately owned company reshaping the world vision of home entertainment. Aeon Digital is positioning itself in the hardware and entertainment industry and is in the initial phase of building an Internet-based network which will deliver unlimited content from the Internet into the living room via the simple technology of "plug and play" television viewing. By combining the old technology of viewing entertainment with the new technology of digital recording, Aeon Digital is enabling consumers the choice to stream, record and play "what-they-want-when-they-want-it" on their TVs in the comfort of their living room by putting content into an actual format they can keep.

Aeon Digital is positioned to emerge as a leader in digital home entertainment within North America, Asia and Europe which will appeal to the consumer that wants an affordable alternative to "Record and Play Digitally Today!"(TM)

About The Petters Group, LLC

Minneapolis, Minn.-based The Petters Group, LLC includes wholesale, retail, finance and fulfillment companies focusing on consumer goods at exceptional prices. With offices worldwide, The Petters Group partners with leading global manufacturers to develop products and brands which it distributes through retail, internet, and catalog channels. The Petters Group has the exclusive license to develop and distribute the Polaroid(R) brand of consumer electronics in the United States and Europe. Thomas J. Petters is Chairman and CEO of the Petters Group. Mr. Petters has more than 20 years' experience in the business-to-business wholesale and retail industries.

About Polaroid(R) Corporation

Polaroid Corporation is the worldwide leader in instant photography. The company supplies instant photographic cameras and films; digital imaging hardware, software and media; secure identification systems; and sunglasses to markets worldwide. "Polaroid" is a registered trademark of Polaroid Corporation, Cambridge, MA. 02139.

About CinemaNow

CinemaNow, Inc. (www.cinemanow.com) is the world leader in Internet-based video-on-demand (VOD) and subscription video on demand (SVOD) distribution and technology. CinemaNow has also developed PatchBay(TM), a proprietary video-on-demand content distribution and management system which runs the CinemaNow Web site, and is available as a licensable technology solution. CinemaNow is majority owned by Lions Gate Entertainment (AMEX and TSE:LGF), a leading creator, producer and distributor of filmed entertainment worldwide.