JesterDigital Teams With Liquid Audio to Add Promotional and Commercial Digital Downloads to Jester.com

Business Wire, Feb 5, 2001

Business Editors

WEST PALM BEACH, Fla. & REDWOOD CITY, Calif.--(BUSINESS WIRE)-- Feb. 5, 2001

Liquid Audio's Retail Integration Fulfillment System (RIFFS)

Enables Jester to Sell Secure Digital Downloads In a 3-D, Virtual

Reality Environment

Liquid Audio, Inc. (Nasdaq:LQID), a leading provider of software and services for Internet music delivery, and JesterDigital today announced an agreement to expand JesterDigital's music collection with promotional and commercial digital downloads. As a result, JesterDigital will feature downloadable music from the more than 10,500 artists from more than 1,000 labels currently distributed by Liquid Audio. Additionally, as Liquid Audio's catalog changes, so will the selection of downloads available through JesterDigital's Web site, www.jester.com.

JesterDigital will use Liquid Audio's software and services to allow its customers to download and purchase more than 120,000 tracks from Liquid Audio's growing catalog of tracks with top sound quality, lyrics, liner notes and album art. Liquid Audio's RIFFS software allows JesterDigital to seamlessly integrate these downloads into its existing user environment so consumers can purchase these Liquid(TM) Downloads from JesterDigital's site.

"JesterDigital's relationship with Liquid Audio provides our 3-D users instant access to a robust selection of secure musical downloads while they enjoy our unique user experience on the Web," said John C. Textor, CEO of JesterDigital. "Even those users operating in a dial-up environment can experience 3-D multi-user functionality, audio and video streaming, and secure digital downloads, which is unprecedented."

"Liquid Audio's merchant software and services helps leading online retailers integrate CD quality downloads and promotional content, providing additional revenue streams by using our RIFFS technology," said Matt Smith, vice president of product marketing at Liquid Audio. "By using RIFFS, Jester can integrate digitally downloadable music in the same virtual shopping cart that holds physical goods while still maintaining control of the merchandising, site design, and checkout process."

Liquid Audio's RIFFS enables merchants to integrate digital music downloads into their sites and sell them alongside physical goods. The Liquid Audio solution provides the e-commerce transaction processing, security, and CD-quality sound that fuels music downloads on more than 1000 Internet music sites. Liquid Audio also provides rights reporting watermarking and encryption capabilities so that merchants can sell and consumers can safely buy legitimate music online. The company's software supports the digital delivery of music in many leading music formats and codes including MP3, Sony ATRAC3, Dolby Digital, AAC, and Windows Media.

About JesterDigital

Positioned at the crossroads of entertainment and advanced technology, JesterDigital is a next generation digital media company founded by proven leaders in the industries of entertainment. Founders include: John C. Textor, Chairman of Sims Snowboards and founder of Wyndcrest Partners Ltd.; Michael Bay, director of Disney Studios' Armageddon, The Rock and the upcoming Pearl Harbor; and Phil Ruggieri, former director of Global Solutions for the Media and Entertainment Group at IBM (NYSE:IBM). JesterDigital has created the first and only multi-user, virtual reality environment to enhance the user-experience of nearly every type of application on the Internet. JesterDigital is based in West Palm Beach, Fla. and Santa Monica, Calif.

About Liquid Audio

Liquid Audio, Inc. is a leading provider of software and services for the digital delivery of music over the Internet. The Liquid Audio solution gives musicians, record labels, Web sites and music retailers the ability to publish, syndicate and securely sell recorded music online with copy protection and copyright management. Using the Liquid(TM) Player software, available for free download at www.liquidaudio.com, music fans can preview and purchase downloadable music from more than 1,000 affiliate Web sites in the Liquid Music Network(SM). Traded on Nasdaq under the symbol LQID, Liquid Audio is located in Redwood City, Calif.