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'Casual Piracy' a Growing Challenge in the Entertainment Industry

Report signals industry’s commitment to address the dynamic digital entertainment landscape

London, UK - 25 Oct 2005 - 'Digital Play', a new research report released today, shows casual piracy is of increasing concern for the entertainment industry, with consistency of approach to content protection becoming a strategic priority. Mass market penetration of digital recording devices and broadband/file-sharing networks are prompting many entertainment brands to enrich their content protection strategies and influence bottom line performance.

The independent research, commissioned by digital content specialist Macrovision, surveyed executives from 100 businesses among the Film, Music and Computer Games industries across the UK, France and Germany. The survey investigates the attitudes and strategies of Europe's games, music and film brands as they combat the billion Euro threats of CD/DVD "Rip & Burn" and illegal peer-to-peer (P2P) file-sharing.

Key findings:

  • 73% of businesses agree that combating copyright theft is more than a battle against organised commercial piracy.
  • P2P and "Rip & Burn" activities now are recognized threats;
  • 85% of businesses believe "Rip & Burn" will continue to be a major issue, with the penetration of DVD recordable devices in consumer homes growing from one-third to one-half of households across Western Europe by 2008 .
  • Only 22% believe the P2P threat to be over-hyped.
  • Music and games industries predict a potential 11% increase in bottom line figures with improved content protection processes.
  • 73% of respondents believe changing consumer perceptions is a priority in tackling casual copying as a long-term goal.

Overall findings from the research point to a clear consensus that improved best practice and compliance can influence the trend of content abuse that brand owners are wrestling with today. The research highlights the role of content protection technologies in thwarting casual piracy, pointing to opportunities presented by an effective model for distributing digital media in a portable, flexible and controlled manner.

The report further suggests a significant enthusiasm from the entertainment sector for a multi-layered approach to tackling digital piracy, one that maintains a balance between delivering robust protection policies today and influencing consumer perceptions in the longer term.

"In tackling the complexity of casual piracy, the desire to change public perception must be supported by best practice strategies. There is significant momentum in the entertainment industry to get this formula right and define a new era of content protection," said Fred Amoroso, Macrovision's CEO. "Across Europe, new recording technologies and P2P networks have changed the dynamics of casual copying and brands are 'suiting up' to address this challenge. It is a commercial, technological and cultural issue in equal measure, and a consistent and balanced response is required to ensure the future success of industry performance and consumer satisfaction."

"For over 15 years, Macrovision has worked in partnership with content owners to address these issues. We are playing an active role in developing innovative solutions to support the stakeholders in the industry, to effectively minimize the risks to content owners and their consumers," added Amoroso.

Billy Hamilton-Stent, Director, Loudhouse Research, concluded: "The entertainment sector is at a critical point in its development of content protection with a significant opportunity presented by the right strategy. The good news is that businesses show a high level of awareness for the need to create an integrated, multi-layered strategy to combat commercial and casual piracy. The challenge is delivering a consistent approach across EU regions that meet the needs of a dynamic entertainments sector with an even more dynamic audience."

About Digital Play

The research was conducted by independent research consultancy, Loudhouse Research, in July and August 2005, and surveyed 100 entertainment industry brands across the film, music and games sectors in the UK, France and Germany.

To download a free copy of the report, go to www.digital-play.net

- Ends -

About Macrovision

Macrovision is the market-leading provider of digital content management solutions for the video, music, games and software industries. Macrovision's technologies are embedded in over 9 billion DVD, VHS and CD units representing over $130 billion of entertainment content. In the software market, Macrovision licenses software developers the FLEXnetTM universal licensing platform and the InstallShield® suite of software installation, repackaging and update solutions, which are deployed on more than 500 million desktops worldwide. Over 50,000 software publishers and virtually all of the Fortune 1000 companies use Macrovision's technologies to maximize the value of their software. Macrovision is headquartered in Santa Clara, California and has offices worldwide. More information about Macrovision can be found at www.macrovision.com.

® Macrovision 2005. Macrovision, FLEXnet and InstallShield are registered trademarks or trademarks of Macrovision Corporation. All other brands and product names and trademarks are the registered property of their respective companies.

This press release may contain "forward-looking" statements as that term is defined in the Private Securities Litigation Reform Act of 1995. A number of factors could cause Macrovision's actual results to differ from anticipated results expressed in such forward-looking statements. Such factors are addressed in Macrovision's Annual Report on Form 10-K for the year ended December 31, 2004 and its latest Quarterly Report on Form 10-Q for the period ended June 30, 2005, which are on file with the Securities and Exchange Commission (available at www.sec.gov). Macrovision assumes no obligation to update any forward-looking statements.

For more information, please contact:

Jon White

Octopus

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E: chris@octopuscomms.net

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