Wendy sets the record straight.
Subject:
Re: shareholder question
Date: Fri, 23 Jul 1999 17:50:27 -0700
From: Wendy Ravenel
To: lulus@
CC: Robert@edig.com
Thank you for writing. Mr. Seymour's last contact with the company took place in May, not June as stated in the article. I am quite surprised that Mr. Seymour did not contact the company for more recent information before publishing this piece. I am afraid that Mr. Seymour's statements are misleading and contain some errors.
e.Digital has had fully-functional prototypes for months, and when Mr. Seymour had the chance to hear a demonstration at PC Magazine Editors Day, he declined, although other editors did hear it, and it performed beautifully. As far as Christmas goes, it will be up to licensees of the secure Internet music player design to determine the launch schedule for the finished product. As is the case with most OEM products, the licensees will also select the desired feature set, color or colors, packaging, and retail price for the finished product, which they will then market to end users.
e.Digital and Lucent are co-marketing the design including all its options to potential licensees and negotiations are under way. We cannot disclose the details of negotiations, but will release news as details become publicly available.
SDMI is still in the process of finalizing their guidelines. Lucent and e.Digital support SDMI's efforts to find secure ways to distribute and play music over the Internet, and have always planned for the design to be SDMI-compliant. Major music labels and artists are also going to be influenced by the SDMI standards.
One fact that was not highlighted in the article is that beyond music, voice products are the real bread and butter of e.Digital, and are expected to generate the lion's share of e.Digital's revenue this year. Regardless of the birthing pains in Internet music, and in spite of any uncertainty in the Internet music market, we will see substantially improved revenue this year from licensing our products in other markets. In addition to our contracts with Lanier and Intel, we are working with IBM, Philips, Intel and others as part of the VoiceTIMES alliance to define and establish voice technology standards for many products spanning several platforms and applications.
For anyone looking for a rebuttal, I would refer them to Mr. Falk's letter to shareholders dated June 28. (http://www.edig.com/Releases/062899shltr.htm)
I hope this information is helpful to you.
Best regards,
Wendy Ravenel
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