(31 October 2005 6:00 pm)

MUMBAI: American firm RealNetworks, which creates digital media services and software has announced results for the third quarter ended 30 September 2005.

It earned revenue of $82.2 million, an increase of 20 per cent from the same quarter last year.
The company also increased its total paid subscribers to more than 2.2 million.

RealNetworks chairman and CEO Rob Glaser says, "We continue to make great progress with strong year over year revenue growth, increased profitability and a base of more than 2.2 million paid subscribers, including 1.3 million paid music subscribers. We continue to expand our growing list of blue chip partners with new relationships with Sprint, Cingular Wireless and, most recently, Microsoft. Together with our partners we are continuing to expand our ability to offer digital music, video and games to consumers
wherever and whenever they want them."

The results for the third quarter of 2005 include an after-tax gain of approximately $8.4 million, or approximately $0.04 per share, associated with the sale of a portion of the company's equity investment in a Japanese public company.

Earlier this month the company had announced a series of agreements with Microsoft
worth at least $761 million which settled all antitrust disputes worldwide and also include collaboration agreements around digital music and games. The company received $460 million in cash associated with the antitrust settlement and technology assurance agreement and will receive another $301 million in cash scheduled to be paid quarterly over 18 months related to the music and games agreements.

Microsoft can earn pre-determined market rate bounties for delivering Rhapsody subscribers to Real, which will be netted against the scheduled quarterly cash payments. The music partnership provides for the integration of Real's leading digital music subscription business, Rhapsody, throughout MSN Music, MSN Search, MSN Messenger and Windowsmedia.com properties. Under the games agreement, Real is also developing a subscription games service to be promoted throughout MSN Games and also will
develop a series of titles for Xbox Live Arcade.

Real continued to see year over year revenue growth driven by its consumer segment, including music and games products and services. Third quarter revenue from the consumer products and services segment grew by 28 per cent to $71.8 million, up from $56.0 million in the third quarter of 2004. In the third quarter, music revenue grew by 39 per cent to $25.0 million, up from $18 million in the third quarter of 2004. Games revenue grew by 62 per cent to $14.7 million, up from $9.1 million in the third quarter of 2004.

Media properties revenue, which includes advertising, increased by 59 per cent to $8.4
million, up from $5.3 million during the same quarter last year. Video, consumer software and other revenue was $23.6 million, flat in comparison to the same period a year ago.