Microsoft and Pace Announce Pace’s First Implementation Of Microsoft TV Advanced Software for TV Cabo Deployment

REDMOND, Wash., and LONDON, June 12, 2001 — Microsoft Corp. and Pace Micro Technology plc, a leading pioneer in digital set-top boxes, today announced the first implementation of Microsoft® TV technology following last year’s memorandum of understanding (MOU), which enabled Pace to integrate Microsoft TV Advanced software into Pace’s set-top box platform. The alliance is supported by a development agreement and a licensing agreement.

The alliance will enable United Kingdom-based developer Pace to integrate Microsoft TV Advanced software into its set-top boxes and deliver a broad range of interactive TV features and capabilities, from enhanced broadcasting to digital video recording. The Pace set-top boxes with Microsoft TV will be deployed for the first time in the second half of 2001, as part of Microsoft’s existing deployment with TV Cabo to cable subscribers across Portugal.

The alliance enables Pace to implement Microsoft’s open architecture platform, delivering on the MOU between the two companies to develop a wide range of applications for digital television. It marks one of the first adaptations of Microsoft TV Advanced software to include full support for the Digital Video Broadcast (DVB) standard. DVB is the dominant standard in digital TV worldwide. Pace and Microsoft also have signed a licensing agreement enabling Pace to preinstall Microsoft TV Advanced software directly onto its set-top boxes for distribution across Europe. Microsoft is fully committed to supporting leading vendors in this space, and its alliance with Pace will enable a more rapid development and deployment of digital enhanced TV services to the home network.

“Our alliance with Pace represents a major step toward our goal of accelerating the availability and benefits of interactive TV services to customers across Europe,”
said Jon DeVaan, senior vice president of the TV Division at Microsoft.
“Through alliances such as these, organizations such as Pace can adapt the Microsoft TV platform to individual markets and individual customer requirements, proving the flexibility and the adaptability of our interactive TV platform.”

“The new alliance with Microsoft is a significant win for us,”
said Tim Fern, chief technology officer at Pace.
“We are fully committed to developing and integrating Microsoft TV Advanced technology into our set-top box platform, and this new alliance will allow us, as a licensed supplier, to deliver the highest-specification open platform possible for third-party innovation across Europe.”

About Pace

Pace Micro Technology plc is a pioneer of digital technology for the home and has helped build the global market for pay television services. Using this expertise, Pace is evolving the set-top box into a home gateway to enable sophisticated services for TV and the networked home. In this networked home, the Pace home gateway is the portal for interactive communications, for consumer devices and services to interact with each other and the outside world.

Pace analog and digital technology has been installed in over 13 million homes worldwide since it was founded in 1982. The company is now actively involved in all digital platforms — satellite, terrestrial, cable, wireless and DSL — through alliances with broadcasters, network operators and technology partners in the United Kingdom, United States, Europe, Latin America, Australasia and the Far East. These achievements were made possible through the commitment of Pace’s 1,400-strong work force, over a third of whom are research and development engineers, dedicated to the development of digital technology for the home and small- and home-office markets.

Pace’s head office is in Shipley, West Yorkshire, with further offices in Bracknell, Cambridge, the United States and Hong Kong. The company’s shares are traded on the London Stock Exhange (PIC). Further information is available on Pace’s Web site at .

About the Microsoft TV Platform

The Microsoft TV platform is a standards-based, client and server software family that enables network operators and their partners to deliver the most compelling interactive TV services to consumers. The platform supports a range of TV devices — from current and next-generation set-top boxes and digital video recorders to integrated television sets, entertainment appliances and other computing devices. Through the platform, network operators and hardware providers can team up to offer consumers an unparalleled range of services, from e-mail and Internet on television to interactive programming, electronic program guides and digital video recording.

Microsoft TV also creates significant new economic opportunities for network operators and industry leaders worldwide that have chosen to work with the platform to deliver or supply services, programming, hardware and software for the interactive TV industry. Microsoft TV supports open standards, and is backed by the technical expertise, support and broad third-party

developer community for which Microsoft is known. It is an integral part of the Microsoft .NET vision of empowering people through great software — any time, any place and on any device. More information about the Microsoft TV platform can be found at .

About Microsoft

Founded in 1975, Microsoft (Nasdaq
) is the worldwide leader in software, services and Internet technologies for personal and business computing. The company offers a wide range of products and services designed to empower people through great software — any time, any place and on any device.

Microsoft is a registered trademark of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

Note to editors: If you are interested in viewing additional information on Microsoft, please visit the Microsoft Web page at on Microsoft’s corporate information pages.

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