Business Editors/High-Tech Writers

SAN DIEGO & BERLIN, Germany--(BUSINESS WIRE)--July 23, 2003

MAGIX, the worldwide leader in Personal Rich Media(TM) software and technologies, and DivXNetworks, the company that created the revolutionary, patent-pending DivX(R) video compression technology, today announced a comprehensive technology licensing and marketing partnership.

Under the agreement, MAGIX has licensed DivX(R) technology as the default video codec for the new video editing release MAGIX Movie Maker(R) deluxe 3. Additionally, the companies will work together to promote DivX(R) licensed MAGIX products through a global marketing and advertising campaign focusing on print and electronic media. DivXNetworks will also actively promote MAGIX products on www.divx.com, the official website for the DivX(R) community with over 13 million unique monthly visitors.

DivX(R) technology will be the exclusive MPEG-4 video codec in MAGIX Movie Maker(R) deLuxe 3 video software, which the two companies will aggressively market to global OEM Channels. Based in Germany, MAGIX is one of the leading multimedia software companies in the world and marked leader in picture, video and music software in Europe. DivX(R) video compression technology is a hugely popular video encoder/decoder that offers DVD-quality video at sizes 7-10 times smaller than MPEG-2 and ranks among the world's most popular video technologies, with over 85 million downloads and an average of over 2 million downloads per month.

"As a true innovator with a strong presence in the global marketplace, MAGIX is an excellent partner to leverage the superior technology and international brand appeal of DivX(R) video," said Kevin Hell, chief marketing officer and managing director of DivXNetworks. "We look forward to working together to bring DivX(R) powered MAGIX products to consumers throughout the world."

"It is clear that DivX(R) is the best MPEG-4 video codec on the market, and the addition of DivX(R) technology to our video software solutions will bring great value to our customers," said Jurgen Jaron, CEO of MAGIX. "DivX(R) offers superior visual quality, high performance and tremendous global brand equity that provides a perfect fit with MAGIX Movie Maker(R) deLuxe 3."