HMV TO WORK WITH TORNADO TO RETAIL DIGITAL CONTENT VIA THE INTERNET

monday 19 november 2001

HMV chooses Tornado Group PLC to provide the technical infrastructure to enable music and games downloads to be sold to consumers on HMV UK website.

Tornado Group PLC (“LSE: TDO”), Europe's leading Digital Service Provider, and HMV, the principal high street retailer of music, videos and computer games, announce today they have entered into an agreement to launch the retailing of digital content via the UK HMV website (www.hmv.co.uk). This will enable consumers to search for, purchase and download music and computer games in digital form, from a constantly expanding database of content. The service is set to launch in the early part of 2002.

Tornado will provide HMV with the technical infrastructure, including the Tornado Digital Media Distribution System (“DMDS”),enabling HMV to retail digital products, such as games and music (singles or albums) via their existing user online environment.

The Tornado DMDS includes a ‘Vendor Interface Toolkit’ which significantly reduces the integration time required to interface a vendors website with the Tornado systems. When the HMV’s website and Tornado systems are interfaced, Tornado provides the XML metadata of available content for display on the vendors website. The virtual fulfilment of the digital content is then provided by Tornado, which means any download bandwidth is removed from the retail site.

Tornado Group PLC currently has agreements with major players in both the music and games market including V2, Electronic Arts, Rage Software, Midas Interactive, EIDOS and Virgin Interactive and are in advanced discussions with other main players in these industries to conclude digital distribution agreements, which will ensure a continually expanding database of digital products. The Digital Rights Management (DRM) technology incorporated to ensure copyright security for the content, allows the content providers (Record Companies and Games publishers)to set their own usage rules for downloads, for example, whether a file can be re-installed, passed to a friend, copied to disk or exported to a portable player.

“We believe there will be a real market for digital distribution in the future, which will compliment our existing high street offer, and now is the time to start putting the building blocks in place” commented Stuart Rowe, E Commerce Director of HMV Europe. “This is a significant move for HMV and Tornado will help us kick start this market successfully.”

“This is an extremely significant agreement for Tornado as it expands our partner retail network of major sites to include HMV, one of the world’s most prestigious retailers, which online and offline reaches a huge audience of music consumers,” commented Neil Ferris, Commercial Director of Tornado Group PLC. “It will undoubtedly facilitate a real opportunity for HMV, Tornado and our content partners to generate considerable revenues from this new, expanding market. It is also further evidence that the ‘future’ of digital distribution is a reality today.”