DMOD and Activated Content Announce Strategic Relationship to Offer Anti-Piracy Solution that Protects Pre-Release Music.

Business Editors/High-Tech Writers

BURLINGTON, Mass.--(BUSINESS WIRE)--July 24, 2003

Firms Bundle Encryption, Digital Rights Management,

Watermarking Offerings for Securing, Controlling, and

Tracing Digital Assets During Music Production Process

DMOD, Inc., the leading provider of secure digital media workflow and distribution solutions, and Activated Content Corporation, acclaimed provider of watermarking and other audio technology service offerings, announced a strategic relationship to more tightly secure the music production process from pre-release piracy. Under terms of the agreement, DMOD and Activated Content will jointly market and sell a bundled offering of the DMOD WorkSpace(SM) ASP hosted service and ActivatedAudio(TM) Watermarking Suite. The bundled offering is the first to incorporate encryption, digital rights management (DRM), and watermarking features in a comprehensive solution that makes it easier to protect and trace digital assets throughout the production process.

According to the International Federation of Phonographic Industries (IFPI) the worldwide music industry lost about $4.6 billion in 2002 to piracy. Published estimates suggest as much as 80 percent of pre-release piracy originates from internal production sources. DMOD and Activated Content are combining the most promising digital media security technologies - encryption, DRM, and watermarking -- to provide a comprehensive solution that will help record labels protect new releases as they move from recording, to mastering, to manufacturing and distribution.

DMOD WorkSpace provides persistent asset protection by combining industry-leading encryption technology with media access controls, or B2B digital rights management features, that define an individual's rights to playback media and/or export media. ActivatedAudio Watermarking Suite provides watermarking production, protection and distribution management features for any audio-inclusive content, such as music, movies and games. Together, the two offerings provide extended piracy protection by enabling traceability, or forensic tracking, of digital media securely distributed by DMOD. Once content is exported with the content owner's permission from DMOD WorkSpace, it can be identified via its unique watermark.

Synergistic Solutions

"Solutions to many content rights management problems benefit from synergies between encryption and watermarking technologies," said Bill Rosenblatt, industry analyst and president of GiantSteps Media Technologies who publishes the newsletter DRM Watch and recently authored a report on watermarking trends. "DMOD and Activated Content have come together to bring the best of both technologies to bear on a particularly sensitive area for media companies. The combined solution should help drive more rapid adoption of these technologies to address piracy within the music industry."

"The entertainment industry has seen too many recent examples of pre-release leaks originating from inside the production process, and it's time to focus on this source of piracy," said Mark Overington, president and CEO of DMOD. "DMOD is delighted to partner with Activated Content in delivering a complete solution for protecting valuable content as it moves throughout the production, promotion, and distribution chain."

"Activated Content and DMOD share the common goal of helping the music industry prevent pre-release piracy," said Stuart Rosove, CEO of Activated Content Corporation. "By combining our two powerful applications in a first-ever comprehensive solution, we hope to advance the industry's ability to take control of their assets and win back revenue lost to pre-release piracy."

Availability

The DMOD - Activated Content bundle is available now. For more information, contact DMOD at 877-918-7711.

About DMOD

DMOD, Inc. provides secure digital media workflow and distribution software solutions for the media and communications industry. DMOD's solutions prevent high-value content from being distributed in unauthorized ways, while simultaneously addressing inefficiencies in the digital production workflow. Weaving together industry-standard encryption technologies, DMOD has developed a patent-pending real-time encryption methodology that provides the highest level of control for digital media assets -- including music, video, graphics, text, software applications, and more. DMOD leverages this technology in developing software applications and OEM solutions that allow content creators and owners to concentrate on the quality and value of digital assets, not the means for securing and protecting them. Founded in 1996, DMOD is headquartered outside Boston. DMOD is privately held and funded by Greylock and Pilot House Ventures Group. For more information on DMOD, visit www.dmod.com.

About Activated Content Corp.

Activated Content Corp. is an emerging technology and technology services provider to the Entertainment Industry. Activated has developed the industry's first comprehensive and practical watermarking solution for encoding identifiable, robust, inaudible and unique codes into digital audio. At the core of each of its products is the ActivatedAudio(TM) Watermark, a patent-pending, "Golden Ear" approved, and field proven audio watermark. Founded in 2001, Activated Content's ActivatedAudio(TM) Watermarking Suite has already been deployed at Record Labels, Mastering Studios, Duplication Houses and Online Distribution Services worldwide. Based in Bellevue, WA, Activated Content is privately held firm. For more information on Activated Content, visit www.activatedcontent.com.