The World's First Video Network to Offer High-quality XVD™ Video Streaming BHA, NSW and JPX cooperate to offer high-quality and high-compression video content over high-speed digital communication networks using XVD - the latest high quality video compression technology

Osaka - August 8, 2003 - B.H.A Corporation (BHA), Nippon Systemware Co., Ltd (NSW) and JPX Corporation (JPX) announced a partnership to establish XVD video distribution network services. The new service, slated to launch in the fall of 2003, will offer video streaming and encoding using XVD, the revolutionary video compression technology that achieves one of the highest quality versus compression ratios on the market today. XVD video streaming content is in comparison both smaller, requires less bandwidth and is of better quality than MPEG-4 based formats, such as DivX.

With the explosion in high-speed broadband Internet access, users are looking towards richer moving image experiences that fully utilize the available bandwidth. Rather than remaining satisfied with stamp-size video downloads over the Internet, the needs of consumers are rapidly changing to wanting access to reliable and high-quality video streaming as a form of entertainment or source of information.

The three companies in the project will jointly offer high-quality video streaming services and pool their respective strengths to ensure success: NSW will provide the infrastructure based upon the urban data center and the "NSW Extranet" high-security broadband technologies, JPX will develop software tools and administration services, including server development and maintenance, and BHA will provide their proprietary XVD technology.

Sales of the new services start 1 September 2003 and will be administered through NSW with a preliminary net revenue forecast of 120M yen for the first six months. Furthermore, to meet future needs, a high-powered backbone circuit that will connect East Japan with West Japan is planned by the end of the year to handle the predicted domestic demand.

About the XVD Streaming Video project

Project areas and benefits:

• XVD Encoding: Encoding software that supports input of MPEG-2 and AVI format video.
• Video Streaming: Video streams can be viewed without a special player. Special players that include Digital Rights Management (DRM) to encrypt and decrypt copyrighted content will also be available.
• Video-on-demand (VOD) Streaming: Entertainment-value DVD-quality video is streamed over standard home broadband Internet connections.
• Live Streaming: Provides real-time encoding and streaming of high-quality realistic video with latency (time delay) of roughly two seconds (similar to satellite links).

• Stream HDTV-quality video (1280 x 960 pixel resolution) at around 3.5 to 4 Mbps and DVD-quality video at approximately 1 Mbps. MPEG-2 requires roughly four times and MPEG-4 twice the bandwidth to achieve similar video reproduction quality.
• Decrease in infrastructure costs by being able due to the possibility of streaming high-quality video over existing medium-speed broadband Internet connections.
• Decrease server side costs by requiring less storage space on the streaming servers.
• Extremely versatile and flexible usage areas, for example: PC peripherals, CD/DVD storage discs, web content streaming, Internet-capable mobile phones, household appliances and much more. Various video codecs are available that support numerous resolutions, frame sizes, bitrates and operating systems. For more details please visit the DS USA website.)

About B.H.A Corporation
B.H.A Corporation is a pioneering developer of recording solutions and has supplied Windows and Macintosh recording software for all major optical storage technologies since 1993. BHA's CD and DVD recording solutions are marketed to the world's leading optical storage OEMs and to end users through distributors and retailers worldwide. BHA recently launched XVD, the next-generation video compression technology that combines high compression ratios with the highest image and sound clarity. In 2003, BHA gained full rights to the XVD technology that was developed by DigitalStream-USA, Inc. BHA's plans are to provide XVD licensing worldwide, including product development and sales. Founded in 1991, BHA employs 56 full-time staff and develops its technologies for CD/DVD recording, UDF packet writing, and video encoding in-house. The company is headquartered in Osaka, Japan and has sales offices in San Jose, California. For more information, please contact: xvdsales@bha.co.jp.

About NSW (Nippon Systemware Co., Ltd.)
Founded in 1966, NSW is an independent IT service company that develops software (45%), devices (24%), offers information services (18%), and distributes system equipment (13%). The company is traded on the Tokyo Stock Exchange and provides total and integrated solutions that start with consulting for the integration of the customer's system and follow through with its design, development, maintenance and administration as well as support for any outsourcing requirements including data center services. NSW specializes in the development of communication and management systems, including software and LSI used in mobile phones and information appliances. For more information, please visit the NSW website.

About JPX Corporation Founded in 2001, JPX Corporation is a leading consultancy company that specializes in developing new IT markets and producing IT business models. JPX's Taiwanese office employs JAVA specialists and develops various software products. JPX also offers ASP services and the development of business software through its affiliate, Act Co., Ltd. Through this latest joint project, JPX is the principal XVD licensee for the Japanese and South-East Asian markets and is fully committed to developing broadband markets. For information, please visit the JPX website (Japanese only).

BHA is a registered trademark of B.H.A Corporation. XVD is a registered trademark of B.H.A Corporation and XVD Corporation. CamCast and CamCast Professional are trademarks of B.H.A Corporation and XVD Corporation. All other company names and products are trademarks or registered trademarks of their respective owners.

For more information, please contact:
Dan Baca
XVD Corporation
dbaca@xvdcorp.com
tel: 408.325.8806 / fax: 408.325.8838