Roxio Updates Business Outlook
Santa Clara, California - (December 12, 2003) - Roxio®, a division of Sonic Solutions® (NASDAQ: SNIC), the leader in digital media software, today provided an update on its business outlook for the quarter ending December 31, 2003.
Roxio's digital media software business is performing ahead of the Company's expectations due to the strong performance of category leading products, Easy CD & DVD Creator® 6 for Windows, and Toast® for the Mac platform.
"We are increasing our guidance for software revenues to approximately $14.5 million and look forward to a very substantial
increase in software revenues next quarter based on the upcoming release of Creator 7 in the first calendar quarter of 2004,"
said Chris Gorog, Roxio's Chairman and CEO.
The $35 billion dollar music industry is just beginning its transformation from physical to online distribution. While Napster has
quickly established itself as one of the top two players in this sector, Roxio believes this very exciting market is still in its
infancy as evidenced by reports from Nielsen Soundscan indicating total single track sales last week by the entire online music
industry were approximately 1.2 million.
"Given this current uptake rate by consumers, we now expect revenue for our online music business to be approximately $3.5 million
for the December quarter. This represents a quarterly run-rate of approximately $5 million given that Napster 2.0 launched at the
end of October. We expect Napster-related spending will decrease substantially going forward as we move away from our Launch quarter
and into steady-state marketing activities. Napster has a number of exciting initiatives underway including our prepaid retail cards,
the Napster BurnPak™ sold at retail and the agreement with Penn State for the Napster subscription service, which should all
positively impact Napster's financial results starting in early 2004," concluded Mr. Gorog.
Roxio, a division of Sonic Solutions, develops and markets the best-selling digital media software in the world. Roxio offers
award-winning software products for CD/DVD burning, photo editing and video editing and has an installed base of over 150 million
users. Roxio distributes its products globally through strategic partnerships with major hardware manufacturers, through leading
retailers, through Internet partnerships and through direct sales at www.roxio.com. Roxio's
parent company, Sonic Solutions (NASDAQ: SNIC;
http://www.sonic.com) is the leader in digital media software and provides a broad range of software
tools and applications for creative professionals, business and home users and technology partners. Sonic's products range from professional
DVD authoring systems and interactive content delivery technologies that are used to produce the majority of Hollywood movies released on DVD,
to the award-winning Roxio- and Sonic-branded CD and DVD creation, playback and backup applications that have become the premiere solutions
for consumers and business users worldwide. Sonic's AuthorScript® is the de facto standard for CD and DVD burning and formatting and has
been licensed by major software and hardware manufacturers, including Adobe, Broadcom, Microsoft, Scientific-Atlanta, Sony, and many others.
Sonic Solutions is headquartered in Marin County, California.
Safe Harbor Statement:
Except for historical information, the matters discussed in this press release, in particular matters related to future revenue and
expenses, customer demand for our software products and for the Napster service, Napster's relationship with marketing partners
and hardware manufacturers are forward-looking statements that are subject to certain risks and uncertainties such as failure to attract
new customers, slow growth in demand for online music distribution generally and for the Napster service in particular, intense competition
in the software and online music distribution industries, failure to maintain key corporate relationships, general economic conditions
and undetected errors in our software products and in the Napster software and service that could cause actual results to differ materially
from those projected. Additional information on these and other factors are contained in Roxio's reports filed with the Securities
and Exchange Commission (SEC), including the Company's Quarterly Report on Form 10-Q as filed with the SEC on November 14, 2003,
copies of which are available at the website maintained by the SEC at http://www.sec.gov. Roxio
assumes no obligation to update the forward-looking statements included in this press release.
Sonic, the Sonic logo, Sonic Solutions, Roxio, MyDVD, CineMagic, Plug & Burn, LiveShare, Roxio Easy Media Creator, and AuthorScript are
trademarks or registered trademarks of Sonic Solutions or its subsidiaries in the United States and/or other countries. Dolby is a trademark
of Dolby Laboratories. All other company or product names are trademarks of their respective owners and, in some cases, are used by Sonic
Solutions under license. Specifications, pricing and delivery schedules are subject to change without notice.