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To: DiViT who wrote (48668)	2/20/2000 11:35:00 AM
From: DiViT	Read Replies (1) \| Respond to of 50808

Semi is valued at $975Million to $1.1Billion. As of Friday's Close it looks like the market valuation of the Semi Biz was at $870 Million... The following pro forma financial statements give effect to the proposed spin-off of the DiviCom business. The financial statements of the Semiconductor business exclude the results of operations and financial position of the DiviCom business, which will be spun-off. The pro forma adjustments are preliminary and based on management's estimates. In addition, management is in the process of assessing and formulating its business plans. Management does not know the exact amount of the restructuring costs but does not believe that they will be material. Based on the timing of the closing of the transaction, the finalization of the integration plans and other factors, final pro forma adjustments may differ materially from those presented in these pro forma financial statements. Two balance sheets have been presented to give effect to a range ofpossible results. Presentation (A) shows the estimated effect assuming a $975 million valuation of the Semiconductor business. Presentation (B) shows the estimated effect assuming a $1.1 billion valuation of the Semiconductor business. The Company estimates that each additional $100 million in valuation will reduce cash and retained earnings by approximately $40 million. The Company has debt financing available should the valuation of the Semiconductor business exceed $1.2 billion. The pro forma balance sheets assume that the spin-off took place on September 30, 1999. The pro forma statement of operations assumes the spin-offtook place as of the beginning of January 1, 1996.

To: DiViT who wrote (48668)	2/20/2000 1:59:00 PM
From: John Rieman	Respond to of 50808

Thanks DiViT. It's Thomson and it's MbTV................. beta.cdad.com Metabyte, Thomson Form PVR Company by Greg Tarr 16-Feb-2000 As personal video recorder developers TiVo and Replay stare down the barrel of Gemstar patent infringement suits over the use of electronic program guides, Thomson and a Silicon Valley software firm called Metabyte are teaming up on a PVR system of their own. Metabyte announced this month that it is spinning off its MbTV division into an independent company called Metabyte Networks. Thomson and hard drive manufacturer Seagate will be minority investors in the venture, while Metabyte retains controlling interest in the privately held entity. The company will be focused on finding other manufacturers to develop MbTV-enabled devices and on delivering an intuitive "service" that monitors viewing patterns to deliver personalized video programming and advertising in a subscription-free fashion. The company will derive ongoing revenue from advertising programs that will help sponsors swap out their own TV commercials with others that may be deemed more appropriate based on the viewer's profile. Other revenue streams may come from pay-per-view video programming that the system can help store and deliver to the viewer, said Metabyte president Manu Mehta. As reported more than a year ago in TWICE, Metabyte has developed a platform called MbTV, which is designed to operate in a fashion similar to TiVo's current PVRs. The software will monitor viewing habits of users to automatically find and record programs it identifies as a logical fit. Mehta said the technology would go further than TiVo, however, by identifying which person in a household is watching the set at any given time, based on the programming that was selected. This will enable the system to call up commercials it has cached on a hard drive to replace one spot from a particular sponsor with a commercial for another product or service in that company's line. Most importantly, the service was designed to work with any electronic program guide, meaning it will not infringe Gemstar's highly protected EPG patents. Mehta said it would be up to the hardware manufacturers to determine the EPG used in a product, and to make any necessary licensing arrangements. Because Thomson has a large equity stake in Gemstar, it seems logical that a MbTV device using a GuidePlus EPG would follow. Rob Logan, Thomson interactive television division general manager, said his company partnered with MbTV more from a technological standpoint than for the potential for venture capital gain. Although he declined to reveal specific product plans, Logan said the MbTV program is small enough to be used in non-hard drive based products, such as DirecTv receivers. The application would then run in the background on a DirecTv terminal to make programming suggestions to viewers, or to program a separate VCR to make recordings for watchers. Naturally, Thomson could also develop an MbTV-enabled hard disc device, although the company announced at CES that it is working with Microsoft's WebTV on a device with similar functionality. "We are strong believers in the functionality of hard disc recording devices," said Logan. Mehta said the company expects to see an MbTV device from an unnamed manufacturer before the end of the year.