CinemaNow Japan to Deliver Broadband Video-on-Demand to Japanese Market; Transcosmos and Microsoft among Investors in the Japan-Based CinemaNow Subsidiary That Will Deliver a Localized CinemaNow Experience for the Japanese Market.

MARINA DEL REY, Calif., and TOKYO -- CinemaNow, Inc., the leader in video-on-demand for broadband, and Transcosmos Inc., the leading marketing chain management company in Japan, today announced the formation of CinemaNow Japan, Inc., a subsidiary of Marina del Rey-based CinemaNow, Inc. This partnership will deliver a rich, innovative, on-demand entertainment service for Japanese consumers via a service which launched today at www.cinemanow.co.jp. As part of this transaction, Microsoft Corporation will also become an investor and shareholder in CinemaNow Japan, Inc.

CinemaNow Japan will incorporate the technology, experience and content relationships of its U.S.-based parent operation, while catering specifically to the Japanese audience with an office in Japan, local Japanese management and a service specifically crafted to appeal to Japanese consumers. CinemaNow Japan will also be teaming up with leading Japanese consumer electronics companies, broadband service providers and portal partners to diversify and enhance the consumer entertainment experience.

CinemaNow Japan launched its service today with 170 titles as part of its initial rollout and will have several content announcements in the coming months. Content for the service will be provided by licensors from Japan, the U.S., and other parts of Asia and Europe, reflecting the viewing preferences of the Japanese audience. The service offers unlimited video playback with a monthly subscription fee of 980 yen.

"Broadband Internet users in Japan finally have an easy-to-use, high-quality, on-demand entertainment experience that will boast a diverse and compelling range of content offerings from Japan, Asia, the United States and Europe," said Curt Marvis, CEO of CinemaNow and chairman of the board of CinemaNow Japan. "This announcement represents a significant step forward in CinemaNow's efforts to offer a rich, innovative entertainment experience to a global market."

The two companies also announced that the board of directors has named Toshiyuki Tomii to serve as president of the newly formed entity. Mr. Tomii joins CinemaNow Japan from Media Cruise Solutions, K.K., where he served as Vice President of Marketing and Business Development. Prior to his role at Media Cruise Solutions, Mr. Tomii had various positions at SGI Japan as a senior sales and marketing manager focusing on digital content distribution.

"Mr. Tomii brings a tremendous amount of experience and knowledge to the position of president, and we expect great success under his leadership," said Marvis. "We see CinemaNow Japan as a remarkable opportunity to leverage CinemaNow's nearly six years of experience in a burgeoning market, and believe that it will quickly become the foundation for our continued growth in Asia and throughout the world."

"This partnership combines the technical expertise, content portfolio and unmatched operational experience of CinemaNow with the innovative market chain management services strategy of Transcosmos," said Masataka Okuda, president and COO for Transcosmos. "The combined resources of these leading companies will produce a dynamic new player in the Japanese online media and entertainment market."

About CinemaNow

CinemaNow, Inc. (www.cinemanow.com) is the global leader in broadband video-on-demand. CinemaNow legally offers content from a library of more than 6,500 new and classic movies, television programs, music concerts and music videos from 20th Century Fox, ABC News, Disney, Lions Gate, MGM, Miramax, NBC Universal, Sony, Warner Bros., and more than 200 other licensors via downloading or streaming. Founded in 1999, CinemaNow continues to be an innovator in the video-on-demand industry with the introduction of high-definition content and support for portable media devices. CinemaNow counts Menlo Ventures, Lions Gate Entertainment, Microsoft, Cisco Systems and Blockbuster as investors.

About Transcosmos

Shibuya-ku, Tokyo-based Transcosmos Inc. has been pioneering Japan's information services outsourcing field since 1966. Led by President and COO Masataka Okuda and traded on the First Section of the Tokyo Stock Exchange (symbol: 9715), it had 8,529 employees and annual sales of 71.1 yen billion in the year to March 2003.

Since its founding, Transcosmos has continually striven to enhance client-corporations' competitiveness through innovations combining the strengths of human resources and technology to offer higher value-added outsourcing services. Foreseeing how the quickening spread of broadband Internet and VoIP is going to facilitate more-direct communication of mutually valuable information between companies and consumers -- and the implications this has for corporate marketing, in June 2002 Transcosmos moved to transform itself into the Marketing Chain Management Company. With a new communications channel now taking shape through the integration of telephone, the Web, email and even live video using Internet protocols, Transcosmos realizes that Internet expertise will be indispensable in the running of contact and call centers. Continuing in its tradition of developing more advanced outsourcing services while adapting the latest Internet technologies, Transcosmos is committed to continue maximizing these, its unique strengths, to help clients speed up business processes, expand sales, cut costs and enhance customer satisfaction. To find out how Transcosmos can help your company with its cutting-edge interactive solutions, you are invited to visit its Web site at http://www.trans-cosmos.co.jp.

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