Beatnik, Inc. - Enhanced Audio Solutions

BEATNIK AND MIXMAN TECHNOLOGIES ANNOUNCE MERGER

Leader in Interactive Audio Extends Reach to the Consumer Market to Further Proliferate the Use of Music and Sound on the Internet

San Mateo, Calif., November 2, 1999 - Beatnik, Inc., the leader in interactive audio technologies and content for the Web, today announced the signing of a definitive agreement to merge with Mixman Technologies, Inc., a leading provider of PC- and Mac-based consumer music creation products.

Beatnik and Mixman share a vision that the promise of the Web will be realized when high-quality, interactive music and sound are part of the everyday Web surfer's experience. The Web will become "sonified" as music and sound is experienced in real time, "on the Web page," and not simply downloaded or streamed from it.

Beatnik and Mixman's shared customer base and technologies will enable millions of professional Web designers, musicians and consumers to create and experience interactive audio on the Web. Together, Beatnik and Mixman will possess one of the most expansive music and sound libraries available on the Web, including both Top 40 artists and professional music catalogs.

Mixman's suite of award-winning consumer software is the market leader for creating, recording, and remixing multi-track music, while Beatnik's authoring tools allow designers to incorporate music and sound into their Web pages. The Beatnik audio engine is the industry standard for digital audio playback and is licensed for use in TV set-top boxes, Internet appliances, Web browsers and Java Sound.

At a time when many Internet companies are struggling to turn the momentum of MP3 music into revenue streams, Beatnik and Mixman both bring proven track records for generating robust revenue from Web music technologies and content to the merger.

"The addition of Mixman's exceptional products, engineering talent, and extensive customer base will have an enormously positive impact on Beatnik's position as the premier provider of interactive music and sound for the Internet," said Lorraine Hariton, president and CEO of Beatnik. "Combining Beatnik Web authoring solutions with Mixman's successful consumer products creates the kind of momentum that fuels content development and licensing agreements with top musical talent. Beatnik-sonified Web sites also will proliferate as our combined user base becomes more proficient with both Beatnik and Mixman tools."

"We are thrilled to be joining Beatnik and helping to spearhead the revolution of bringing audio to the Internet," said Eric Almgren, CEO and co-founder of Mixman Technologies. "Having already begun to pool our talent and resources, Beatnik and Mixman is becoming a powerhouse for the leading music software, Web-based communities, Web audio technologies and content needed to sonify the Web."

According to a recent report by Jupiter Communications, 80 percent of business executives interviewed cited that audio will become a standard feature on the Internet within the next two years. The report recommends Web sites immediately adapt audio to deliver a passive experience for utility, guidance, cueing and branding, as well as develop interactive audio content to serve as an active pull for consumers to experience music, information and narrative audio.

"Interactive music and sound will soon be ubiquitous on the Web, making sonification a leading method for capturing and engaging a Web site audience. Beatnik and Mixman technologies increase the stickiness of a site, which is extremely significant, as twenty minutes spent on a Web page equals about two and a half hours, or eight times the value of the minute, of passive television viewing, " said Michael Moon, analyst at Gistics Research. "It is clear that interactive audio retains audiences longer, provides more meaningful impressions for advertisers and presents online companies the opportunity to sell more products and build larger Web communities."

In the new Beatnik organization, Mixman co-founders Eric Almgren and Josh Gabriel will become Beatnik's senior vice president of sales and label relations, and chief product officer, both reporting to Beatnik CEO Lorraine Hariton. Beatnik and Mixman will retain all employees of both companies.

About Mixman Technologies, Inc.
Mixman Technologies Inc. is a privately held company based in San Francisco designing remix and performance technologies, musical products and a Web-based music community that enable people of all ages and skill levels to interact with, customize, control and perform music with professional quality tools. The company's product line includes a range of Web and packaged software products, including Mixman Studio Pro Deluxe, Mixman Studio Pro and Mixman Studio, and over a dozen Soundiscs™, professional multi-format audio sample CD-ROMs. Mixman software is translated into nine languages available worldwide on Win95/98 and soon, the Apple Macintosh and NT platforms. The company partners with major PC hardware and software manufacturers and leading record labels including Capitol, Tommy Boy, and Warner Brothers Records to deliver content from artists in Mixman's interactive format.

About Beatnik, Inc.
Beatnik, Inc. is the premier technology platform to create, deliver, and experience interactive audio on the Web. The Beatnik Audio Engine for the digital playback of audio has been licensed to an expanding family of strategic partners, including Microsoft's WebTV Networks, Sun Microsystems, Netscape, Intel and Liberate (formerly NCI). Beatnik's Web authoring tools are used by Web designers in the creation of Web sites such as MTV Online, Yahoo, Altoids and David Bowie.com and also ship with products from Macromedia and NetObjects. The Beatnik Player currently allows more than 7 million Web surfers to experience the power of interactive music and audio. Its Rich Music Format™ (RMF®) is the Web standard for high quality, multi-track music with file sizes that are small enough not to require streaming and are secure per Web site usage. By coupling expert engineering skills with an expanded catalogue of musical content, Beatnik is dedicated to realizing new possibilities for interactive music and audio on the Internet. Beatnik (formerly Headspace, Inc.) was incorporated in 1996 with a team of software innovators and world-renowned visionary, musician and composer Thomas Dolby Robertson.

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