Kontiki Announces Breakthrough in the Economics of Digital Media Distribution, with New Advancements in Grid Delivery Technology and Integration with Key Microsoft Products

Business Wire, April 22, 2003

Business Editors

SUNNYVALE, Calif.--(BUSINESS WIRE)--April 22, 2003

Companies Who Use Microsoft's Popular Desktop and Server Products

Can Now Easily Add Digital Media Distribution Through Kontiki

Kontiki today announced enhancements to its industry-leading Grid Delivery Technology(TM) that save companies over 90% in the cost of distributing video and other digital media over their existing corporate networks and the Internet.

Kontiki's technological advances -- as well as its new integration with key Microsoft desktop and server products -- dramatically change the economics of digital delivery for enterprises.

Kontiki's grid delivery software transforms a company's underutilized servers, personal computers and networking infrastructure into a network capable of delivering videos, complex documents and software quickly and securely. The breakthrough enhancements announced today give companies unprecedented cost savings and network performance when sending digital content to users on intranets, extranets and the Internet.

"The business case for rich media in the enterprise is compelling," said Lawrence Orans, senior analyst at Gartner Inc. "Now, many of our clients are investigating technologies that will allow them to distribute rich media without causing network traffic jams or requiring substantial new infrastructure investments. Enterprise-based grid delivery is an emerging solution that enables the bandwidth-efficient distribution of rich media."

Kontiki said the significant savings are achieved by intelligent routing of content through underutilized or inexpensive communication links, automatic scheduling of deliveries for the most optimal time, employing technology to eliminate failed deliveries and utilizing a grid of existing PCs and servers as active nodes to relay content. These technologies reduce the cost of digital delivery by more than 90%.

"Our customers are experiencing off-the-chart savings, with their costs dropping over 90% from their traditional means of electronic distribution," said Mike Homer, Kontiki's CEO and founder. "It is now also more than 90% less expensive to send digital media electronically than through traditional physical CD shipments. Our technology has proven these savings at large scale, with over 2.5 million users of the Kontiki Delivery Management System."

Kontiki announced the following enhancements to its grid technology:

-- Grid Streaming, which enables video or audio to be streamed

and optionally saved for later use, adds additional

flexibility for content providers and users. This allows

companies to offer an immediate playback option that is also

cost-effective for the first time.

-- Grid Multicasting, which enables a single piece of content to

be relayed to many users on a local network automatically,

minimizing use and congestion on expensive WAN links.

-- Cost Optimized Routing enables customers to considerably cut

bandwidth costs by relying on the Kontiki Delivery Grid's

ability to distinguish between more and less expensive network

links and route digital media at the lowest overall cost.

Since much of this less expensive bandwidth is available on

local area networks, use of more costly WAN links can be

reduced by as much as 80%.

-- User-Based Class of Service Controls, which allows enterprise

IT to define service levels for every user and group, enabling

finer control over digital media delivery costs.

"Using Kontiki's technology, our GameSpot and Download.com properties now offer the Internet's biggest library of fast, free downloads to our users," said Vince Broady, senior vice president of consumer properties at CNET Networks. "The Kontiki system helps keep bandwidth costs down so we can focus on what's important -- delivering users the latest demos, trailers, patches and software downloads."

"We are now using video much more extensively for training, support, and marketing because we can deliver the materials online at a fraction of the cost through Kontiki," said Ken Wirt, Palm Inc. Solutions Group senior vice president of sales and marketing. "It used to cost us $4-8 each to create, package and ship CDs or videotape, making it a major expense that we needed to use sparingly. Now, it costs us just 25 cents to deliver the same information to our sales team, partners and Palm customers, and the deliveries are virtually instantaneous."

By integrating support for widely-used Microsoft desktop and server products into its Grid Delivery Technology, Kontiki has made it easy for corporate IT departments to bring grid delivery into existing enterprise applications. Doing so enables Microsoft customers to enhance applications such as content management, sales training, customer and partner communications and Web-based information delivery using digital media.

Kontiki is announcing integrated support for the following strategic Microsoft products:

-- Embeddable Active X control, allowing integration with

Internet Explorer and Microsoft Outlook. This allows digital

content such as videos to be accessed and played right on Web