Who you Gonna Call for Video-on-Demand? CinemaNow!

Following the burst of the dot-com bubble, scores of business leaders hoping to solve the riddle of monetizing aspects of the
Internet put their heads together and came up with such pay-to-play platforms as MusicNet and pressplay, the proprietors of which
could license them to firms looking to offer online music subscription services.

Now it seems there is a like service for delivering video-on-demand (VoD) as CinemaNow Inc., the Marina Del Ray, Calif.-based top
provider of VoD services Monday launched the first solution that may be licensed to parties interested in setting up their own VoD
offerings. Called PatchBay, it runs vis-à-vis the Microsoft Windows 2000 operating system and includes support for Windows
Media audio, video and digital rights management.

CinemaNow designed PatchBay to manage the total works of Internet-based VoD distribution, including distribution, syndication,
digital and territorial rights protection, user profiling, targeted advertising, comprehensive pay-per-view
and subscription services, e-commerce management and integration of other third-party components. What’s more, the content offered
by PatchBay can be played on any IP-enabled device, so laptops, set-top boxes and personal digital assistants are all distinct
possiblities.

Other specifications of PatchBay are that it manages about 1 million users watching more than 2 million streams of video each month
on CinemaNow.com. And after Microsoft there are third-party technologies thrown into the mix, including Digital
Envoy’s geolocation services, DoubleClick Inc.’s DART ad manager and VeriSign Inc.’s
verification and payment collection services.

In saying that he hopes PatchBay will become the “central nervous system” for companies desiring to offer VoD, CinemaNow Chief
Technology Officer Brad Serling, summed up the company’s strategy.

“By making the real-world-proven video-on-demand technologies that manage our own Web site available as PatchBay, we are creating
revenue opportunities for distributors worldwide,” said Serling.

CinemaNow did not reveal its terms with Microsoft, third-party tech providers, or even price points it would offer licensees, but
one thing that is known is that some research firms think highly of VoD as a money-making service. Boston’s Yankee Group said VoD
will generate revenues of more than $65 million by year-end 2001, and will reach $1.98 billion by year-end 2005.

CinemaNow, majority-owned by Lion’s Gate Entertainment, currently streams more than 250 feature-length films using Windows Media
Player on pay-per-view, subscription and ad-supported bases. It also has access to more than 1,000 films from the Lions Gate,
Trimark Pictures, Avalanche, Allied Artists, Tai Seng and Salvation film libraries for VoD distribution.