Beatnik, Inc. - Enhanced Audio Solutions

NUMBER OF BEATNIK AUDIO ENGINE ENABLED MOBILE PHONES GROWS RAPIDLY

…sales of Beatnik-enabled Smartphones more than double in six months …operators launching Beatnik RMF ringtone services

San Mateo, CA – September 16, 2003 -- Beatnik, Inc., a leading provider of standards-based structured audio software solutions for mobile devices, today confirmed the rapidly expanding number of Beatnik Audio Engine™(BAE™) enabled mobile phones in use by consumers. Not only is BAE now in use by 2.68 million* owners of Symbian OS powered phones, up from 1 million in November last year, but is also deployed in a wide range of phones from Nokia. More devices from Beatnik's increasing roster of industry-leading licensees, which currently include Siemens, Samsung, Sony Ericsson and Motorola, are due to appear on the market in the near future. The wide range of BAE-enabled phones from licensees who together supply over 70% of global mobile phone volumes is helping stimulate more than 60% growth in sales of polyphonic ringtones.** 2003 has seen operators launching even higher quality digital ringtone services, based on the Beatnik-developed Rich Music Format (RMF) standard.

The Beatnik Audio Engine and its associated content development tools enable network operators to deliver increasingly advanced mobile audio services to their subscribers. Currently, these include high-fidelity sampled ringtones, authentic game sound effects, sound-enhanced multimedia messages and user interface sounds. In the future, as operators forge ever stronger relationships with record, film and games companies, Beatnik's RMF and XMF technologies will be used to deliver high quality music clips and film out-takes, as well as being used in spatialised audio effects in mobile games.

"Our estimates suggest that in the second quarter of 2003 alone, more than 1.2 million mobile phones based on Nokia's Series 60 platform were shipped, all containing the Beatnik Audio Engine," said Tim Mui, research analyst for IDC's European Smart Handheld Devices team. "We believe that the emergence of innovative multimedia technology in handsets - including high quality audio software - is playing a critical part in helping the operators to drive demand for their new branded services."

Beatnik's RMF technology - and its open standard derivative XMF (eXtensible Music Format) - allows BAE-enabled devices to play MIDI music and sequence digital audio samples such as vocal tracks. This powerful combination delivers very small sized audio files with high-fidelity audio, allowing customisable recorded audio for polyphonic ringtones, interactive game audio and user alert tones.

"Mobile phones and other smart devices are rapidly becoming the most customisable consumer electronics devices that users have ever had," said Jeremy Copp, Chief Sales Officer at Beatnik. "But simply changing a cover or downloading a poorly produced, bleepy ringtone is no longer enough. The Beatnik Audio Engine and associated technologies allow operators to take a big step up in the services they can offer their customers - as is shown by the rapid growth in shipments BAE-enabled phones."

* Symbian press release: see http://www.symbian.com/press-office/2003/pr030821.html
** The Mobile Data Association estimates that UK ringtone sales will total more than €100m by the end of 2003, as against €63m in 2002.

For more information on Beatnik, Inc., go to: www.beatnik.com or contact:sales@beatnik.com or .

About Beatnik, Inc.
Beatnik licenses scalable, standards-based structured audio software solutions for mobile devices, which enable rich multimedia content delivery and an enhanced user experience for games and device interaction. Beatnik markets its core software technology and audio content development tools to mobile device manufacturers and a community of creative professionals. Incorporated in 1996, Beatnik was founded by musician and composer Thomas Dolby Robertson.