AMP3.com and AudioSoft Join Forces to Bring Back the Single; The Fastest-growing New MP3 Site On the Internet Now Offers E-commerce to Visitors and Copyright Security for Artists

Business Wire, March 18, 1999

AUSTIN, Texas--(BUSINESS WIRE)--March 18, 1999--AMP3.com, the world's fastest-growing new MP3 Web site on the Internet, today announced a joint venture with AudioSoft, the pioneering developer of secure music distribution systems via digital networks. AMP3.com's Web site features more artists -- close to 1,000 performers -- than any of the five major record labels.

Under terms of the new agreement, AMP3.com ( www.amp3.com ) and AudioSoft ( www.audiosoft.com ) will work together to create an e-commerce reporting and payment system for the AMP3.com site. This will allow audiophiles to purchase music singles for 99 cents over the Internet in a completely secure environment. Visitors can also download songs for free and know that they are not infringing upon any copyright laws.

The system will also enable AMP3.com to track purchases, allocate copyright payments and accurately report back to the artists. What separates AMP3.com from other MP3 sites is that with AMP3.com, artists actually make money, whether listeners decide to buy their songs or not. Artists receive a two-cent royalty per download. Popular songs are downloaded tens of thousands of times, so royalties can be significant.

MP3 is a downloadable music format that stores audio files on a computer, keeping the file size small but retaining near CD-quality sound.

"In addition to the downloading royalties, we split our advertising income with the artists. If a potential advertiser decides to sponsor a particular song by placing a short jingle ad to be played before the song, AMP3.com and the artist split the profits 50-50," explains Michael Sharp, CEO of AMP3.com.

This cooperation with AudioSoft will now enable visitors to purchase a particular song that they like. "Instead of having to go to your local Blockbuster Music store and buy a CD for $16, you can now just buy the song you like for 99 cents at AMP3.com.

"No wonder the record industry is panicking. With the help of AudioSoft, anyone can come to AMP3.com and download their favorite music for free. Every song comes with a 3-5 second jingle. If you really like the song, you can now purchase it online for 99 cents, without the jingle before the song," Sharp says.

The new system also solves many copyright issues. "The world of music has been a jungle on the Internet. The biggest problem has been the illegal piracy of music on the Internet," Sharp notes.

"The single is what built the record business, hit by hit," said AudioSoft CEO Francois-Xavier Nuttall. "The MP3 format lets music fans buy songs the way they have always wanted to, one great track at a time. Using the Internet, AMP3.com is leading the music industry back to its roots, and AudioSoft is helping to ensure that artists get paid for every song they sell."

By compensating artists, AMP3.com can secure a better selection of music than other MP3 sites. And by offering a better audio selection, the site is increasing visitor traffic and creating a more attractive target for advertisers. AMP3.com receives approximately 2 million hits per month, and is growing rapidly.

About AMP3.com

AMP3.com is the fastest growing new MP3 site on the Web today. It has become a portal for artists to distribute their music. AMP3.com offers free downloading of music in a secured, copyright covered environment where the musician gets paid per download and music fans can enjoy a wide selection of music.

About AudioSoft

AudioSoft is a software developer and content aggregator dedicated to the secure electronic distribution of music over digital networks with full copyright protection and management. AudioSoft operates a distribution channel for audio over high-bandwidth networks and over the Internet ( www.citymusic.com ), and provides the music industry with secure solutions and tools to distribute music from their own Web sites. The company's innovative software products includes Virtuosa Gold, the world's first all-in-one MP3 Player, CD Ripper and CD Burner ( www.virtuosa.com ).

For additional information, please contact David Whitman of Merger Communications at 713/267-2328 ( www.mergerusa.com ), or Amy Bonetti of Big Mouth Communications at 415/837-1900.