ActiveVideo Networks Acquires Avinity Systems, Creates Powerful Interactive Platform...

ActiveVideo Networks Acquires Avinity Systems, Creates Powerful Interactive
Platform to Redefine iTV on Global Scale

COLOGNE, Germany, May 27 /PRNewswire/ -- ActiveVideo Networks(TM) announced
today that it has reached an agreement to acquire Avinity Systems BV, bringing
together the two leading providers of cloud-based interactive TV platforms and
applications, and expanding the reach and availability of the Web-based user
experiences that are redefining interactive television (iTV 2.0).

The transaction, which was announced at the ANGA Cable Trade Fair here,
strengthens ActiveVideo Networks' technology and application offerings and
creates a global leader in the fast-growing market for delivery of cloud-based
services to televisions around the world. The acquisition combines two
companies that will have deployed interactive services to more than five
million homes worldwide by the end of 2009. Post-acquisition, ActiveVideo
Networks will have publicly-disclosed deployments with a wide variety of
service providers, including Oceanic Time Warner Cable and Grande
Communications in the United States; Tele2 and Reggefiber in Europe; and PCCW
in Hong Kong. In addition, the acquisition will significantly expand
ActiveVideo Networks' list of content relationships and middleware and
infrastructure integrations.

"The two companies were pursuing the same vision on different continents,"
said Gary Lauder, chairman of ActiveVideo Networks. "Fortunately, their
strengths and technological assets are very complementary. Due to that, and
the Avinity team's high caliber, we expect everyone to be retained and to be a
vital part of our global expansion."

ActiveVideo Networks and Avinity have consistently advocated that the future
of content delivery -- including VoD navigation, Web-based video, interactive
advertising and other services -- will be driven by server-based technologies.
Both platforms use an ultra-thin client in the set-top box to pass user
keystrokes to servers in the network. The servers create compressed video
streams in response to user interaction and unicast them over IP or cable back
to the home to be decoded and displayed by the set-top box. When combined,
the ActiveVideo(R) and Avinity RenderCast platforms will be capable of
delivering Web-like personalization and interactivity to a worldwide
television audience through both legacy and next generation digital set-top
boxes and broadband-connected devices.

In conjunction with the acquisition, ActiveVideo's European operations will be
relocated to Avinity's headquarters in Hilversum, The Netherlands, near
Amsterdam. Ronald Brockmann, director of Avinity, will serve as Managing
Director for ActiveVideo Europe. Adding a strong European team to the
ActiveVideo teams on the East and West Coasts of the United States builds on
the company's philosophy that local knowledge and experience are required to
create television applications that appeal to audiences that increasingly
demand localization and personalization of their content.

"We have always been impressed with Avinity's technological progress,
philosophical approach and marketplace traction in Europe," said Jeff Miller,
president and CEO of ActiveVideo Networks. "Combining their people and
technology portfolio with our own enables us to significantly increase our
deployment momentum to European markets. The combination creates a team with
global reach and local experience that is unparalleled in the delivery of
stream-based interactivity"

"ActiveVideo has been a leader in anticipating the media industry's adoption
of cloud-based interactive services," said Brockmann. "Ultimately, both of
our companies recognized that we could do more for service and content
providers, advertisers and consumers by bringing our very complementary
capabilities under a single roof."

About Avinity Systems BV
Avinity Systems is a leading vendor of interactive TV platforms and tools
enabling rich media services on existing infrastructures, without the need for
new high-end set-top boxes. Its partners include Tier 1 Cable and IPTV
operators as well as leading content providers. Avinity's RenderCast platform
enables richer video navigation, branded portals, web to TV and interactive
advertisements. Avinity was founded in early 2005 and is based at the
Hilversum Media Park in The Netherlands.

About ActiveVideo Networks
ActiveVideo Networks(TM) provides programming and technology that infuse
television with Web content and interactivity. Based on standard Web
authoring and delivery technologies, the company's ActiveVideo(R) Distribution
Network simply and inexpensively enables expanded programming, navigation and
advertising possibilities, allowing viewers to define and share their TV
experiences. ActiveVideo combines Web-based media and targeted, clickable
advertisements with the high-quality video, immediate responsiveness and
remote control navigation of television for uniform interactivity across all
digital set-tops and Web-connected televisions. ActiveVideo Networks is based
in the heart of Silicon Valley, with offices in Los Angeles and Baltimore. For
more information, visit www.activevideo.com.

SOURCE ActiveVideo Networks

Paul Schneider for ActiveVideo Networks, Cell, +1-215-817-4384, pspr@att.net