PortalPlayer, Inc. supplies consumer electronics manufacturers with complete platform solutions for open and secure delivery and management of digital media. The company is developing and marketing advanced systems for digital audio recording and playback, using MP3 and other popular digital compression technologies, tightly integrated with electronic commerce and digital rights management technologies. PortalPlayer's strategy is to provide a complete product platform and supporting infrastructure - including web-based applications, PC media management software, firmware, and semiconductors - enabling its customers to quickly bring innovative new devices to market.

Products for the Digital Media Revolution

The delivery of digital content across the World Wide Web is revolutionizing the relationship between content providers and consumers. Electronic commerce gives artists and producers the ability to deliver their work immediately to a broad listener base. But the significant challenge of combating piracy by honoring the usage rules associated with the digital media must be addressed to realize the full potential of downloadable and streaming music.

The challenges faced by consumer electronics manufacturers, content providers and eCommerce companies are compounded by the difficulty of defining standards and technology solutions that address the concerns of all participants in the new digital media industry. PortalPlayer cuts through the current marketplace chaos through a comprehensive, "United Nations" approach. The company provides its customers with a complete set of technologies that can be implemented across a variety of products. This includes support for different Digital Rights Management (DRM), audio compression, digital "wrappers," and multiple storage media, such as Memory Stick™ and other types of secure card technology. This provides the company's partners with the flexibility to achieve product differentiation across families of highly scalable digital media platforms.

PortalPlayer is the first company to develop and market fully integrated hardware/software platforms to consumer electronics vendors that are manufacturing digital music enabled products. Last year, PortalPlayer brought to market a series of digital audio platforms and services for use in portable and home electronics systems. These platform and media infrastructure solutions support a full range of open and secure digital media applications - from ripping a CD track into an MP3 format, to purchasing a coded and encrypted, digital rights managed song. Supported by licensing agreements and strategic partnerships with leaders in content distribution, DRM, and secure storage media, PortalPlayer products will enable the next generation of Web-based consumer entertainment appliances.

Realizing the Promise

MP3 (or MPEG1 layer 3) is a technical format that has become synonymous with digitized music distributed on the Internet. It is actually one of many formats, each of which uses sophisticated compression algorithms to make storage of digital recordings practical, without sacrificing the audio quality of the original. Using formats like MP3, a high-quality stereo recording of a three-minute song that typically would take up about 30 MB of disk space can be captured in a near-CD quality file requiring about 3 MB of storage: a 10:1 compression ratio.

Clearly, the combination of compression and access to the Internet's digital pipeline dramatically reduces the time and the cost of distributing music to consumers. Recording artists and labels gain the freedom to market and distribute material in any manner they please. However, many artists are concerned about the price of that freedom. Securing payment and ensuring copyright protection in the digital age are critical issues in the digital entertainment revolution.

Building the Next Generation of Digital Audio

The best known digital audio products today are small players that allow consumers to listen to audio files recorded, compressed and then downloaded from a consumer's desktop computer. First introduced in 1998, these portable players have captured the imagination of technically savvy consumers, creating a market of millions of units per year. Today, the consumer electronics industry has recognized that these portable players are just the tip of the iceberg.

As more people gain access to high-bandwidth Internet connections, market demand for products that support digital music will grow exponentially. This growth will be based on two closely related applications, downloadable audio for personal use, and streaming audio to deliver digital radio broadcasts via the Internet. To support both applications, familiar home and car audio systems will feature digital audio capability, and entirely new classes of products that use the technology will soon begin to reach the market.

PortalPlayer provides its OEM customers with the complete product infrastructure required to deliver exciting new products for the digital media revolution. These products include semiconductor chipsets, based on the PortalPlayer SuperIntegration™ Chip Architecture, upgradable firmware, application software to manage the capture, compression and storage of content, and server-based application software for Internet-delivery mechanisms. The company has an extensive network of alliances and licensing arrangements to ensure that all required technologies are delivered to the consumer electronics manufacturer in one comprehensive package.

It is inevitable that the Internet will change the economics of music and, ultimately, all multimedia distribution. PortalPlayer will play a role in this revolution, providing complete solutions - from chips to digital media management software - that enhance the digital media experience.

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