Lucent Digital Radio and Harman Kardon Announce Agreement to Develop Digital Radio Receivers and Promote New Technology.

WARREN, N.J.--(BUSINESS WIRE)--Aug. 31, 1999--

Lucent Digital Radio, Inc., a venture owned by Lucent Technologies (NYSE:LU) and Pequot Capital Management, Inc., today announced an agreement between Lucent Digital Radio and Harman Kardon(r), a wholly owned subsidiary of Harman International Industries, Inc. (NYSE:HAR) to develop prototype receivers using Lucent's In-Band On Channel (IBOC) Digital Audio Broadcast (DAB) digital radio technology. The partnership will further advance audio storage technology that is made possible through the industry-leading Lucent Perceptual Audio Coder(tm)(PAC(tm))technology.

"We are giving birth to a whole new generation of devices that can decode digital radio signals, which will enable radio consumers - who are not just listeners any more - to receive CD-like sound and different forms of data, from news and traffic alerts to song title information," said Suren Pai, president and CEO of Lucent Digital Radio, Inc. "We believe that our work with Harman Kardon will help us realize the goal of a working IBOC receiver that will be designed to take full advantage of digital radio's enormous potential."

Digital radio receivers will have larger liquid crystal display (LCD) panels than today's receivers which will enable radio consumers to receive data that is carried over an FM or AM radio station's signal at rates up to 100 kilobits per second, much faster than the rates currently available to mobile Internet users.

"This is an exceptional opportunity for Harman Kardon to further its digital audio capabilities and to add another industry first to its history. Harman Kardon introduced the world's first stereo receiver in 1954, and now through our partnership with Lucent, we expect to introduce the world's first IBOC receiver. Our experience in the consumer marketplace in combination with Lucent's leadership in communications technology will undoubtedly yield exceptional new products," said Tom McLoughlin, president of Harman Kardon, "and we look forward to working with Lucent on this venture."

According to the Consumer Electronics Manufacturers Association (CEMA), there are more than 600 million radios in the United States, or more than 6 per household. More than 235 million Americans on an average weekly basis of 22 hours consume radio. The digital radio era will enable new forms of content services and devices to deliver greater quality and quantity of programming to more listeners than ever before.

Lucent Digital Radio's IBOC DAB system is an enhancement to current analog AM and FM radio broadcasting systems. It will provide greatly enhanced sound quality for AM radio, CD-like quality for FM radio, as well as interference-free reception and innovative new data services. Lucent Digital Radio draws on several patented Bell Labs digital audio and channel coding techniques that provide robust digital signal delivery in an impaired broadcast channel, including Lucent's Perceptual Audio Coder(PAC) technology, which delivers CD-like quality audio at 96 Kilobits per second; Unequal Error Protection, which prioritizes information based on its impact to audio quality; and Multi-Streaming, which provides for a more robust signal in an impaired channel.

The IBOC approach will allow broadcasters to introduce digital audio programming to listeners on their current dial positions using existing transmitters and antennas. IBOC DAB is both backward- and forward-compatible: current AM/FM receivers will still be able to receive the existing analog signals in the new system. When a station elects to turn off the analog signal in the future, IBOC DAB-compatible receivers will operate with the remaining all-digital signal.

For more information about Harman Kardon, please contact Franklyn Roth, Dobbin/Bolgla Associates, at 212-388-1400. Information is also available on the Web site at www.harmankardon.com.

The Harman Consumer Systems Group (HCSG) is a leading designer, manufacturer and marketer of a wide range of high-fidelity loudspeakers, audio and video components and multi-media systems for use in homes, automobiles and with computers. The Group's brands include JBL, Infinity, Harman Kardon, Mark Levinson, Revel, Proceed and Audioaccess.

HCSG is a division of Harman International Industries, Inc. Harman International (www.harman.com), is a leading manufacturer of high-quality, high fidelity audio and video products for the consumer and professional markets. The Company's stock is traded in the New York Stock Exchange under the Symbol: HAR. Lucent Digital Radio, Inc. is a company developing IBOC DAB technology for AM and FM broadcasting worldwide. Lucent Digital Radio's IBOC system will be resistant to multipath and other forms of interference that impair current analog transmissions. Information is also available on the Web site at www.lucent.com/ldr.

For more information about Lucent Digital Radio, please contact William Casey, Director, Marketing & Sales, on 908-580-7008 or [e-mail]. Information is also available on the Web site at www.lucent.com/ldr.

Lucent Technologies, headquartered in Murray Hill, N.J., designs, builds and delivers a wide range of public and private networks, communications systems and software, data networking systems, business telephone systems and microelectronic components. Bell Labs is the research and development arm for the company. For more information on Lucent Technologies, visit the company's web site at www.lucent.com.