SOURCE: KOCH Entertainment

February 13, 2006 12:14 ET

KOCH Expands Digital Initiative: Announces Key Partnerships and Multi-Label Deals

New Media Division Signs Over 40 Digital Label Deals and Partners With RoyaltyShare to Launch Cutting-Edge Digital B2B Service

PORT WASHINGTON, NY -- (MARKET WIRE) -- February 13, 2006 -- KOCH ENTERTAINMENT DISTRIBUTION, North America's largest independent music distributor, announced today that it has increased its digital initiative with the signing of several key digital partnerships and distribution deals. The company has signed strategic partnerships with the INDEPENDENT ONLINE DISTRIBUTION ALLIANCE (IODA), the industry-leading digital distribution company for the global independent music community, and ROYALTYSHARE, a leading provider of digital sales data consolidation and royalty accounting services to record labels, music distributors and publishers.

KOCH's New Media division has additionally signed over 40 exclusive digital distribution deals with existing independent labels on its current physical roster. These include such award-winning independent labels as Acoustic Disc, Bar None, Silva Screen, Babygrande Records, Sanctuary Classics/ASV, Fat Boy, Tim Janis Ensemble, and Chandos. These initial deals account for over 32,000 digital music tracks covering a wide spectrum of musical genres from hip hop to classical.

"We've created a revolutionary digital alliance with IODA and RoyaltyShare that puts us far ahead of our competitors," says Michael Rosenberg, President of KOCH Entertainment Distribution. "Partnering with IODA gives us a unique platform to offer independent labels an incredibly broad network of digital retailers while allowing our own staff to focus on our larger digital retail partners. This, together with our new cutting-edge digital B2B service powered with digital sales data provided by RoyaltyShare, makes for the most dynamic and logical digital solution for any independent label."

KOCH's current digital distribution network includes direct deals with the key digital retailers that comprise a majority of the digital market share such as iTunes, Rhapsody/Real Music, Napster and MusicNet. Its partnership with IODA now extends that reach to over 150 additional digital retail outlets, while also providing encoding and delivery solutions for KOCH's extensive audio catalog. Selected releases will also be made available for promotional use through IODA's Promonet, the promotion distribution network which provides qualified podcasts, blogs, internet radio and e-zines with access to thousands of pre-cleared, legal music tracks, videos, artwork, and other promotional assets.

"KOCH Entertainment has been at the forefront of independent music distribution for a long time," said IODA founder and CEO Kevin Arnold. "IODA is proud to be providing technology solutions to enhance KOCH'S digital distribution efforts and expand its reach to include additional services, retailers, and mobile platforms around the world."

The agreement with RoyaltyShare aggregates the digital sales data of the company's distribution arm to power a new digital B2B environment and enhanced royalty reporting tools. This will enable its labels to analyze digital sales data and make decisions based on digital sales trends. This kind of access to sales data is something that has existed for years in the physical distribution world, but has yet to be commonplace in the digital space.

"Data is truly the DNA of digital sales and it's essential that record labels are able to successfully process and leverage the complex data generated by digital music offerings," said Bob Kohn, Chairman and CEO of RoyaltyShare. "We are pleased to help KOCH Entertainment provide an innovative and critical set of services to its label partners. This new service will allow labels to keep their fingers on the pulse of their digital sales efforts."

About IODA

IODA -- the Independent Online Distribution Alliance -- is the industry-leading digital distribution company for the global independent music community. IODA provides comprehensive services to record labels, physical distributors, and artists, including license negotiations; media encoding and metadata management; royalty payment administration and reporting; and promotional support through the IODA Digital Marketing division. Founded in 2003, IODA represents a rapidly expanding roster of over 300,000 tracks from more than 1,200 independent labels around the globe. The IODA catalog ranges from established classics to modern up-and-comers in all genres, including favorites such as Antony and the Johnsons, London Symphony Orchestra, Bebel Gilberto, Billie Holliday, They Might Be Giants, The Hives, The Wrens, Ryuichi Sakamoto, Van Morrison, and Fela Kuti. IODA was named one of FORTUNE magazine's 25 Breakout Companies for 2005. The company's web site is located at http://www.iodalliance.com.

RoyaltyShare: Royalty Solutions for a Digital World

Based in San Diego, RoyaltyShare, Inc. is a venture-backed company focused on providing comprehensive royalty accounting services to record labels, music distributors and music publishers. RoyaltyShare's solutions are designed to manage the complexities inherent in digital distribution, allowing customers the freedom to pursue new revenue streams. RoyaltyShare provides the back-end support required to manage multiple and inconsistent data sources, and accurately compensate artists, publishers and songwriters.

KOCH Entertainment is the leading and fastest-growing independent music and video company in the U.S. and its operations encompass record and video labels as well as physical and digital distribution companies in the U.S. and Canada. KOCH Entertainment is the market leader among independents in both the U.S. and Canada and its record labels had the largest number of Billboard charting albums among independents in 2004/2005.

For more information, please contact James Scileppi at (516) 484-1000 Ext. 243 or email james.scileppi@kochent.com.

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