Card Scanning Solutions to Expand Digimarc Digital Watermarking-Based Authentication of Driver Licenses.

Card Scanning Solutions will offer its nearly 1,000 licensees Digimarc[R] IDMarc[TM] capabilities to authenticate U.S. driver licenses at commercial points of inspection

BEAVERTON, Ore. -- Digimarc Corporation (NASDAQ:DMRC) today announced it has licensed its market-leading Digimarc[R] IDMarc[TM] digital watermarking software development kit (SDK) to Card Scanning Solutions (Card Scanning), a provider of ID scanning and verification solutions, to bring this powerful new means of authenticating U.S. driver licenses to Card Scanning's network of users and value added resellers.

Card Scanning will incorporate digital watermarking inspection capabilities into its portfolio of ID reading and verification solutions to help customers such as retailers, insurers and auto dealerships fight identity theft and fraud by reliably authenticating driver licenses presented as proof of identity and age.

"The driver license has become the de facto citizen ID in the U.S. today, and the need for reliable machine authentication is essential to combating identity theft and fraud," said J. Scott Carr, executive vice president, Digimarc. "Twenty U.S. states have adopted IDMarc digital watermarking to secure the licenses they issue, and this feature can be found in more than 50 million circulating U.S. driver licenses. The Card Scanning offerings will enable a wider range of businesses who rely on driver licenses to take advantage of digital watermarking to verify age and authenticate driver licenses in markets ranging from retail operations and nightclubs to auto dealerships and insurance."

"Retailers, banks, auto dealers and other commercial users are demanding secure, reliable means of easily verifying the authenticity of a driver license to reduce fraud. Digimarc IDMarc digital watermarking provides the cross-jurisdictional authentication they demand, in a form that is easy to deploy and use," said Iuval Hatzav, Vice President, Card Scanning Solutions. "As a leading developer of identification card scanning solutions, we are delighted to be working with Digimarc to offer IDMarc digital watermark inspection capabilities to our VAR and developer network and ultimately to the ID inspection markets that they serve."

With more than 240 valid driver license designs for the millions of licenses circulating in the U.S., visual inspection alone is not adequate to determine the authenticity of these IDs. Digital watermarking takes the guesswork out of inspection and provides reliable authentication of driver licenses and IDs using an intuitive and easy-to-use red-light-green-light indicator of authenticity. Digimarc anticipates that 1 in 2 U.S. driver licenses issued in 2007 will be secured with digital watermarks.

Card Scanning supports VARS and application developers that build industry-specific solutions using the Card Scanning hardware and software platform. Card Scanning products include software- and hardware-scanning solutions for driver licenses, checks, medical cards, and business cards. For more information about IDMarc inspection solutions offered by Card Scanning Solutions, please call: [phone].

About Digimarc

Digimarc Corporation (NASDAQ: DMRC), based in Beaverton, Oregon, is a leading supplier of secure identity and media management solutions. Digimarc provides products and services that enable the annual production of more than 60 million personal identification documents, including two-thirds of U.S. driver licenses and IDs for more than 20 countries. Digimarc's digital watermarking technology provides a persistent digital identity for various media content and is used to enhance the security of financial documents, identity documents and digital images, and support other media rights management applications.

Digimarc has an extensive intellectual property portfolio, with more than 300 issued U.S. patents with more than 5,000 claims, and more than 500 pending U.S. and foreign patent applications in digital watermarking, personal identification and related technologies. The Company is headquartered in Beaverton, Oregon, with other U.S. offices in Burlington, Massachusetts; Fort Wayne, Indiana; and the Washington DC area; and international offices in London and Mexico. Please go to www.digimarc.com for more company information.

Securities Safe Harbor 

With the exception of historical information contained in this release, the matters described herein contain certain "forward-looking statements" that are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements regarding Card Scanning's deployment of Digimarc IDMarc digital watermarking and the expected benefits of Digimarc IDMarc digital watermarking in authenticating driver licenses, as well as other statements containing the words "believes," "expects," "estimates," "anticipates," "will" or words of similar import or statements of management's opinion. These statements are subject to certain assumptions, risks, uncertainties and changes in circumstances. Actual results may vary materially from those expressed or implied from the statements herein or from historical results, due to changes in economic, business, competitive, technological and/or regulatory factors. More detailed information about risk factors that may affect actual results is set forth in filings by Digimarc with the Securities and Exchange Commission on Forms 10-K, 10-Q and 8-K, including but not limited to those described in the Company's Form 10-Q for the quarter ended September 30, 2006 in Part I, Item 2 thereof ("Management's Discussion and Analysis of Financial Condition and Results of Operations") under the captions "Liquidity and Capital Resources" and "Factors Affecting Forward Looking Statements" and in Part I, Item 4 thereof ("Controls and Procedures"). Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date of this release. Except as required by law, we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements.