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September 16, 1998

REALNETWORKS & INTEL TEAM TO SMOOTH STREAMING

By CBR Staff Writer

RealNetworks Inc, in the throws of a spat with Microsoft Corp over Redmond allegedly breaking its technology despite the two having a licensing agreement, has signed another one with the other half of the Wintel duopoly, Intel Corp. RealNetworks has licensed Intel’s Streaming Web Video software and has incorporated it in the encoder, server and clients of its next- generation audio/video streaming product line, RealSystem G2, the second beta of which will be released within 30 days. It will be the first version to feature the Intel technology and the gold version will ship before the year-end. According to RealNetworks, the inclusion of the Intel technology leads to frame rates of up to 30 frames per second and also enables the product to scale a lot better than previously. It has been configured to take advantage of the Intel architecture, specifically the Pentium II. From the broadcaster’s point of view it is said to enable up to four times faster encoding than previous versions of RealSystem, according to the company’s own benchmarks and what would have previously taken four or five servers can be encoded using one Pentium II-based server, the pair claim. On the post-production side, Intel’s technology also provides something called Frame Rate Upsampling (FRU), which uses motion estimation to create intermediate video frames to make the streaming smoother. Also in G2, RealNetworks own SureStream technology promises a solution to the re-buffering problem that plagues the technology at the moment, causing regular pauses even on T1 connections. It works by enabling encoding at multiple bit rates, so when congestion does occur, parts of the stream can be fed in at the lower bit rate, reducing the quality slightly, but ensuring that there is no pause. The two companies began talking about a year ago and Intel’s VP and general manager of its business platform group, Paul Gelsinger says the development cycle is a few months ahead of schedule. In July last year Microsoft licensed streaming audio and video technology from RealNetworks. Redmond has the right to extend that .licensing agreement within the next nine months and take another snapshot of RealNetworks technology in that period. RealNetworks chief executive Rob Glaser – a former Microsoft VP – said the Microsoft licensing deal was for some of the version 4.0 technology – the product is currently on version 5.0. Both Glaser and Intel’s Gelsinger emphasized that the deal was not exclusive, the technology still belonged to Intel and it would not be part of any Microsoft deal with RealNetworks unless Microsoft negotiated a separate deal with Intel. The pair were not commenting on any financial terms, but presumably RealNetworks paid a licensing fee to Intel for the technology as Intel has not taken a stake in RealNetworks, unlike Microsoft, which holds about 10%. The news was good for a $4.875, or 24.8% rise in RealNetworks’ share price to close at $24.50.

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