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Command Audio and Sony Settle PVR Patent Infringement Suit

SAN MATEO, Calif – Command Audio Corp., a leader in the development of broadcast on-demand media technology, today announced that its patent infringement suit in the U.S. against Sony Electronics Inc. has been settled.

Under terms of a confidential license agreement, Sony has made a financial settlement and has taken a royalty-bearing license to use Command Audio’s patented technology in such products as personal video recorders (PVRs) and personal computers with PVR functionality. The worldwide agreement runs for the life of Command Audio’s core PVR patents.

“We are very pleased with this outcome,” said Don Bogue, chairman and CEO of Command Audio. “Our patents are critical to the time-shifting functionality and convenience that millions of TV viewers and radio listeners are demanding. Our license agreement with Sony demonstrates the strength and value of our patents. We expect continued success as we actively protect and license our intellectual property.”

Command Audio previously has licensed its patents and technology to industry leaders in the consumer and automotive electronics fields, including Motorola (NYSE:MOT), XM Satellite Radio (NASDAQ:XMSR) and iBiquity Digital Radio. However, Sony is Command Audio’s first licensee in the burgeoning PVR field, where leading independent industry analysts estimate that more than 30 million units have shipped to date and forecast more than 35% annual growth for the next five years.

“Command Audio holds 38 U.S. and foreign patents,” said Bogue, “with applications that span the radio, television, cellular and game console industries. The demand for devices and services that provide consumers convenient time-shifting functionality is growing rapidly in each of these markets. We believe this agreement provides a strong basis for us to continue licensing our technology across these fast-growing markets.”

Command Audio filed suit against Sony in February 2002, charging that the company had infringed two of Command Audio’s patents (U.S. Patent Numbers 6,330,334 and 5,590,195, both based on an application originally filed in 1993). The patents broadly cover the audio elements of PVR functionality and, specifically, the audio contained in broadcast television programs. The patents predate the development of the first PVR product by several years.

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Command Audio pioneered the development of on-demand interactive audio. The Company owns and licenses a portfolio of U.S. and foreign patents covering the transmission, storage, navigation and consumer playback of the audio elements of broadcast media. These capabilities are incorporated in a variety of consumer and automotive electronic devices and in the services that transmit content to them. Some of the best-known products incorporating Command Audio’s technology are personal video recorders (PVRs) and radios with record functionality. Emerging applications include cellular telephones and game consoles.

Headquartered in San Mateo, CA, Command Audio is a privately-held company backed by strategic investors Macrovision, Motorola and Texas Instruments and leading financial investors, including Canaan Partners, Franklin Resources, Granite Ventures, J.P. Morgan Capital Partners and Paul Allen’s Vulcan Ventures. Visit Command Audio at http://www.commandaudio.com. Contact: Gary Tobin, 415-256-9490.

Sony Electronics Inc. is the U.S.-based electronics unit of Sony Corporation of America and the Sony Corporation (NYSE:SNE).

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