- The Washington Times - Tuesday, May 2, 2000

Excalibur Technologies Corp. in Vienna, Va., is joining forces with the world's largest chip maker, Intel Corp.

Excalibur, which develops software that manages text, images, video and audio, is forming a new interactive media-services company with Intel. The new company will allow owners of branded content like sports and entertainment to produce and securely sell their content over the Internet.

"This new agreement … propels us to the forefront of media management on the Internet," said Patrick C. Condo, president and chief executive of Excalibur. "The new company's services will enable end users to interact with and enjoy branded content they have never before had access to on the Web, and content owners will be able to deliver their content knowing where it's going, who's using it and how it's getting there."

Excalibur will combine its 240-employee business operations into the new company, which has not yet been named. Intel will contribute resources from its interactive media services division and invest $150 million in exchange for 60 percent ownership in the new company.

Excalibur shareholders will have 40 percent ownership in the new company in exchange for their Excalibur stock. Holders of 29 percent of Excalibur's outstanding voting stock have agreed to vote in favor of the transaction.

Officials would not disclose any projections or financial information.

The new company's headquarters will be in Silicon Valley with major offices in Virginia. It has not yet been determined how many Intel employees will be working for the new company.

Mr. Condo will become president and chief operating officer of the new company. Ronald J. Whittier, senior vice president and general manager of Intel's interactive media services, will become chairman of the board and chief executive officer.

"The services [from the new company] are generally intended to be broad enough to provide a one-stop shop for content owners," Mr. Whittier said.

Officials said a fully integrated company that allows branded content to be delivered to subscribers over the Internet does not yet exist. The new company will combine Excalibur's content-management technologies with Intel's technology for content protection.

This will give consumers a new kind of branded interactive media, enabling them to view old newsreels, films, sports highlights and television programs.

For example, an organization like the National Football League could let subscribers view a full season of games in real time, search for old games or find particular parts of a game. Excalibur and Intel's new company would ensure the league that only subscribers get access.

Mr. Whittier said Intel decided to form this new company, rather than acquire Excalibur, in an effort to get these services into the market more quickly.

It would have taken another six to nine months to acquire Excalibur and take the new company public, he said.

Excalibur, which trades on the Nasdaq Stock Market, closed at $33.88 yesterday an increase of nearly 250 percent since Nov. 1, when the stock closed at $9.69.

Excalibur, founded in 1980, reported a $300,000 loss for its fiscal year ending Jan. 31, 2000, compared with a $3.9 million loss for the previous fiscal year.

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