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Ideal Solution Achieved by Combining High-Fidelity AAC Music With Advanced DRM Technology

Using AAC with InterTrust's leading Digital Rights Management (DRM) technology permits deployment of AAC within the leading content management and protection framework. The combination of InterTrust's DRM technology and the AAC technology will be made easy for music player application and authoring tool designers through use of the popular Xaudio multi-Codec framework, recently acquired by InterTrust. Audio fidelity experts consider AAC to provide CD-quality fidelity at the lowest data rates possible today. It is based on technology developed by Fraunhofer, AT&T, Dolby and Sony Corporation -- the ``FADS'' group.

Adoption of AAC has been limited due to concerns about releasing high-fidelity Codecs outside the context of a protected processing environment in the wake of the unprotected MP3 phenomenon. Proliferation has also been limited by questions about licensing terms and conditions. By providing AAC within InterTrust's DRM system, distributors not only rest assured that the Codec will be used appropriately, but they may now offer innovative DRM -based licensing models for the technology.

``FADS is intent on making AAC the global standard for electronic music delivery,'' said Ramzi Haidamus, Technology/Business Strategist at Dolby Labs. ``This will happen through a combination of innovative licensing options and the integration of AAC with the appropriate protection and management technology. Dolby believes that InterTrust DRM makes this a reality today.''

``AAC is the seal of its technology generation,'' said Dr. Karlheinz Brandenburg Head of Multimedia Department of the Fraunhofer IIS and one of the world's leading researchers in Codec design. ``In designing AAC, we took all of the lessons learned in building MP3 and achieved significantly higher sound quality at lower bit rates. This approaches the scientific limits of any envisioned perceptual Codec technologies. The combination of the leading quality Codec and the leading quality DRM represents an important step in the evolution of the commercial distribution of music.''

``InterTrust wants to ensure that consumers, music companies, and hardware and software companies have the broadest range of options available in designing and using high quality DRM-enabled products, applications and services,'' said Talal G. Shamoon, VP Technology Initiatives at InterTrust. ``Adding AAC is a significant step forward in providing the fullest range of quality audio options possible.''

InterTrust Digital Rights Management

Digital rights management (DRM) technologies protect and manage rights and interests in digital information. InterTrust's DRM platform provides a common foundation for authors, publishers, enterprises and others to define rules for using digital information and building commercial models. InterTrust® technology is designed to protect digital information, apply rules persistently after information is distributed, and automate many of the commercial consequences of using the information. InterTrust's DRM platform is general purpose and can manage a broad range of media types, including music, publications, business information, video, games, software, and images. Content providers and enterprises can take advantage of InterTrust DRM through the use of the MetaTrust Utility, a neutral environment for digital commerce.

InterTrust Technologies Corporation

InterTrust Technologies Corporation is the leading developer of distributed digital rights management (DRM) technology. InterTrust has developed a general-purpose DRM platform that serves as a foundation for providers of digital information, technology, and commerce services to participate in a global system for digital commerce. InterTrust licenses its DRM platform as software and tools to partners. Collectively, these partners will offer digital commerce services and applications that form a global commerce system branded as the ``MetaTrust Utility.''

About AAC

AAC is high-quality audio coding technology and the solution of choice for digital audio applications in broadcasting, electronic music distribution and portable audio devices. In independent tests, coding efficiency for AAC proved to be superior to MP3, allowing for CD-like quality. In addition, AAC maintains ITU-R audio broadcast quality at 320 kb/s for 5.1-channel audio programs and provides unprecedented feature-richness with up to 48 channels and a sample rate of up to 96 kHz. Developed and standardized by four industry leaders (AT&T, Dolby Laboratories, Fraunhofer IIS, and Sony Corporation), AAC is widely supported by a growing number of hardware and software manufacturers.

About AT&T

AT&T Corp. is the world's premier voice and data communications company, providing services to virtually every country and territory around the world. AT&T runs the world's largest, most sophisticated communications network and the largest digital wireless network in North America. The company is a leading supplier of data and Internet services for businesses and the nation's largest direct Internet service provider to consumers. AT&T's businesses are backed by the research and development capabilities of AT&T Labs, which is working to create the information services and communications network of tomorrow.

About Dolby

Dolby Laboratories is a developer of audio technology and signal processing systems used worldwide in applications that include motion-picture sound, consumer entertainment products and media, broadcasting, and music recording. Dolby also contributed to the development of MPEG-2 AAC and is the sole licensor of the audio coding technology, with an emphasis on applications such as music delivery for the Internet and digital radio. Based in San Francisco with European headquarters in England, the privately held company also has offices in New York, Los Angeles, Shanghai, and Tokyo.

About Fraunhofer IIS

Fraunhofer IIS is a leading research laboratory in the area of audio coding. Since the start of the audio coding work some ten years ago, Fraunhofer IIS has actively pursued international standardization of several audio compression algorithms including MPEG Layer III and AAC. In addition to research on advanced algorithms, Fraunhofer IIS engineers focus on real-time implementation of coding schemes on digital signal processors (DSPs) that are used in a variety of market applications.

About Sony Corporation

Sony Corporation is a leading manufacturer of audio, video, communications, and information technology products for the consumer and professional markets. Its music, pictures, and computer entertainment operations make Sony one of the most comprehensive companies in the world. Sony recorded consolidated annual sales of over $56 billion for the fiscal year ended March 31, 1999.

For Further Information Contact:

Joseph Jennings, InterTrust, 408-855-0201, jjennings@intertrust.com, Leigh Anne Varney, Varney Business Communication, 415-387-7250, la@varneybusiness.com, Andrew Fisher, Dolby Laboratories, 415-558-0200, acf@dolby.com.

AAC Licensing Information: aacla@dolby.com

The statements contained in this release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, including statements regarding InterTrust's expectations, beliefs, hopes, intentions or strategies regarding the future. All forward-looking statements included in this document are based upon information available to InterTrust as of the date hereof, and InterTrust assumes no obligation to update any such forward-looking statement. Actual results could differ materially from current expectations. Factors that could cause or contribute to such differences include, but are not limited to, the factors and risks discussed in InterTrust's reports filed from time to time with the Securities and Exchange Commission.

NOTE: InterTrust is a registered trademark of InterTrust Technologies Corporation, and the InterTrust logo, MetaTrust, and MetaTrust Utility are trademarks of InterTrust Technologies Corporation, all of which may or may not be used in certain jurisdictions. All other brand or product names are trademarks or registered trademarks of their respective companies or organizations.