DivXNetworks, e.Digital in Cross-town Collaboration
Tuesday, 09 April 2002
SAN DIEGO — Electronic music gadget maker e.Digital Corp. said Tuesday that it
has formed a partnership with cross-town software firm DivXNetworks to make
consumer products that play high-quality compressed video, marking the first
time that DivXNetwork's compression software, which is widely used to distribute
video over the Internet, will be put into hardware devices.
While financial terms of the deal were not disclosed, the two San Diego-based
firms will jointly develop and market the hardware devices, with the first product
expected to be available by the end of the year.
Potential equipment that could come out of the agreement include handheld
DivX video players, DivX-enabled DVD players, home video jukeboxes, digital
video recorders, digital set-top boxes and digital video cameras.
The products will be branded e.Digital with a DivX certification. The companies
also said they will let other manufacturers have access to the designs.
Privately held DivXNetworks Inc. created the DivX MPEG-4 compatible video
compression technology, which is used to transfer high-quality video over the
Internet at high speed. The company says it has 50 million users worldwide.
Digital rights management — a hot button issue for all the studios in Hollywood
worried that their movies will be passed around electronically for free — will be
"secure," the companies said in a release issued Tuesday.
DivXNetwork's compression software, which has more than 50 million users
worldwide, is used to transfer high quality video over the Internet at high speed.
In a statement, Jim Collier, president and COO of e.Digital sounded very excited
about the deal. "I don't think that it's possible to overestimate the importance
of DivX video technology and the global influence it will have on entertainment
media," Collier said. "It holds the promise to be to video what MP3 compression
technology has been to audio, but on a much wider and far reaching scale."
His company makes Walkman-like devices for playing back MP3 files of
compressed music. Shares of e.Digital (OTC: EDIG.OB) gained five cents on
Tuesday, ending the day at 78 cents per share, for a market cap of $102.9
million.
AI
