Loudeye Corp. (LOUD)

[IAMSAM]

T.O.S of Japan Chooses Loudeye for Wireless Music Delivery
PR Newswire - August 20, 2003 07:05

Loudeye Providing Digital Distribution Services to T.O.S. Supporting
The Delivery of Rich Media Ringtones to Mobile Subscribers of KDDI, One
Of the Largest Wireless Carriers in Japan

SEATTLE, Aug. 20 /PRNewswire-FirstCall/ -- Loudeye Corp. (Nasdaq: LOUD), a leading provider of services for the management, promotion and distribution of digital media, today announced a wireless music digital distribution agreement with T.O.S Co., LTD. (www.tos.ne.jp), a leading ringtone provider in Japan. Under the agreement, Loudeye is providing music content, programming services, music samples, copyright license clearing and royalty reporting and settlement to T.O.S. for rich media ringtones to be marketed and sold to wireless subscribers of KDDI-AU, one of the largest wireless carriers in Japan. As of June 2003, KDDI-AU had 14.7 million wireless subscribers, including over 11.5 million EZweb wireless Internet subscribers and 8.6 million third generation mobile phone subscribers (www.kddi.com/english).

The Japanese Society for the Rights of Authors, Composers and Publishers reports an average of 110 million ringtones were downloaded each month in Japan throughout 2002. Global research and consulting company, Strategy Analytics, forecasts that the downloadable ringtone market, including rich media ringtones, will increase to $4 billion by 2008.

Loudeye is delivering the music in the proprietary EZ Movie format with all associated music data and music samples of the rich media ringtones for customers to preview on the T.O.S. WAP and PC Websites prior to purchase. As part of the deal, Loudeye has been chosen to maintain detailed tracking information and download data on the usage of the content and will manage royalty reporting and settlement on behalf of T.O.S. and KDDI-AU. Under the agreement, Loudeye is providing ongoing music programming, encoding, copyright license clearing and royalty reporting. Loudeye receives upfront and ongoing service fees, including a percentage of revenue from each purchased download.

In related news, on August 7, T.O.S. announced the launch of their rich media ringtones service called "Magic Sounds" for KDDI-AU mobile phone subscribers. Wireless customers of KDDI-AU's ringtone subscription service will gain instant access to rich media ringtones for purchase in 30-40 second song clips. Rich media ringtones differ notably from traditional mono and polyphonic ringtones in that the files are created from the actual song recording.

"Loudeye was instrumental in removing several major barriers and reducing time to market in launching our service," said Akira Tanii, president of T.O.S. "Through their archive and label relationships, Loudeye enabled us to offer an extensive catalog of music content from U.S. artists, meeting a growing demand for this content among our customers' wireless users. By working with Loudeye and gaining access to popular music from the U.S., we add significant value to our offering and help drive ringtone downloads for our customers."

Through its licensing agreements with all five major labels and hundreds of independents, Loudeye operates the world's largest archive of digital music with more than 4 million full song tracks. Last month, Loudeye announced its entry in the mobile music market with four customers, one of which is T.O.S. Loudeye's wireless distribution offerings are built on the Loudeye Media Framework, a comprehensive, scalable and cost effective platform to integrate customers' in-house solutions with Loudeye applications and services.

"Music ringtones make up a large portion of the mobile music market and wireless content providers, such as T.O.S., need full digital distribution systems to support their business," said Jeff Cavins, Loudeye's president and chief executive officer. "Our digital media management and distribution systems were built on a highly flexible and scalable platform capable of supporting emerging opportunities in the marketplace. Today's announcement with T.O.S. and the extension of our services into the mobile media space demonstrate the growing areas in the industry the Loudeye Media Framework can support."

About Loudeye Corp.

Loudeye provides the business infrastructure and services for managing, promoting and distributing digital content for the entertainment and corporate markets. For more information, visit www.loudeye.com.

Forward Looking Statements

This release contains forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about Loudeye's relationship with T.O.S Co., LTD and the use, performance, expected benefits and projected revenue associated with Loudeye's digital media services, including song samples, rich media ringtones and the Loudeye Media Framework; and statements made by Loudeye's president and CEO. These statements are based on current estimates and actual results may differ materially due to risks, including the possibility of adverse changes in the market for distribution of digital music that we serve; adverse or uncertain legal developments with respect to copyrights surrounding the creation and distribution of digital music; pricing pressures and other activities by competitors; the failure of our hosting infrastructure; the complexity of our services and delivery networks; any problems or failures in the structure, complexities or redundancies of our network infrastructure; failures in third party telecommunication and network providers to provide required transmission capacity; our capacity to scale and support third party technologies; lack of market acceptance for our products and services; the possible delay in the adoption of digital media or related applications on the web in general; and other risks set forth in our most recent Form 10-Q, Form 10-K and other SEC filings which are available through EDGAR at www.sec.gov. We assume no obligation to update the forward-looking statements.

SOURCE Loudeye Corp.

/CONTACT: media, Jill Sandnes of Barokas Public Relations,
[phone], or [e-mail], for Loudeye Corp.; or investors,
Michael Dougherty of Loudeye Corp., [phone], or [e-mail]/

/Web site: http://www.tos.ne.jp /

/Web site: http://www.loudeye.com /

(LOUD)