MACROVISION CORP (MVSN)

[kenco]

From: Rob_STONE/us/[e-mail]
Date: 25 Jun 11:18 (PDT)
To: "Kayliegh Enco" <[e-mail]>
Subject: Re: your PR on MVSN today

You do have the complete text, which does not state or imply that SunnComm
will be the industry standard. So far, they are widely deployed by just one
label, BMG.
And, the current dual session format, which does not support iPod, is not
the solution the labels ultimately want.

--------------------------
Robert W. Stone
Managing Director
Institutional Research

SG Cowen Securities Corporation
Two International Place
Boston, MA 02110
tel: [phone] fax: [phone]
e-mail: [e-mail]

----- Original Message -----
From:<[e-mail]>
To:[e-mail]
Cc:[e-mail]
Date: 06/25/2004 12:29:00 PM
Subject: RE: your PR on MVSN today

Dear Mr. Stone,

This PR below is currently being circulated on a couple
of stock chat boards as an endorsement that Sunncomm is
on track to become the industry standard in this field,
I just wanted to ask if this is your actual and
complete PR? also, is it your conclusion that Sunncomms
product is on track to become the industry standard as
the people circulating this article suggest? I have
also included links to the actual posts that I found
your PR on.

Thanks in advance,

Kay


+++++++++++++++++++++++++++++++++++++++++++++++++++++++++
[ID:2042021]


June 25, 2004

Macrovision (MVSN)

U.S. CD Copy Protection Gaining Momentum, But Further
Development Required

Conclusion: BMG is approaching mainstream adoption of a
competitor's CD audio copy protection technology. While
this is positive for the entire industry, our checks
suggest MVSN's CDS-300 product needs further
development. We remain cautious regarding MVSN's
success in this segment. However, with adoption still
early and CD audio less than 5% of our 04/05E sales, we
maintain our bullish view on the stock.

Competitor's CD Solution Gaining Mainstream Adoption In
U.S. BMG has now released a total of 12 copy protected
CDs using competitor SunnComm's technology. Releases
include Velvet Revolver's 'Contraband', the #1
top-selling album in America two weeks ago. This is a
significant step forward for the industry and should
prompt other labels to follow.
Our Checks Suggest Growing Momentum For CD Copy
Protection. Based on our discussions with several major
labels, we believe initial sell-through data for copy
protected CDs strongly supports the rationale for copy
protection expenditures. One noted that new release
sales typically drop in week #2 by 50% and copy
protected discs have shown drops on average of 30%.
Moreover, certain artists are now requesting labels to
use copy protection.
MVSN CDS-300 Unlikely To Be Adopted In Its Current
Form. A key requirement for many labels is support for
multiple file formats, especially Apple iPod. MVSN
CDS-300, in its current form, is designed to support
only MSFT music files. Further development will be
required to support multiple file formats. Given CD
space limitations, the files must be made 'on-the-fly'
from the red-book audio session. Our checks suggest no
competitor has this capability yet. So we believe MVSN
is still in the running for new wins. But, SunnComm and
First4Internet are likely strong contenders.

Robert W. Stone
[phone]
[e-mail]


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