Sonic Foundry and Philips Consumer Electronics Enter into Bundling Partnership

Sonic Foundry[R] Inc. (NASDAQ: SOFO), the leading developer and marketer of digital media and Internet software tools, services, and systems, today announced a partnership with Philips Consumer Electronics to bundle its award-winning SIREN[TM] XPress personal music manager with their latest Philips Edge[TM] series of sound cards.

Sonic Foundry has developed a custom build of its SIREN XPress jukebox software to be bundled with Philip's new Rythmic Edge[TM] 3D stereo sound card and its Seismic Edge[TM] quad surround sound card. Additionally, Sonic Foundry's soon-to-be-released SIREN XPress 2.0 will be bundled with Philips Acoustic Edge[TM] sound card, the industry's first PCI audio accelerator enabling 5.1–channel playback of games, music, and movies. Shipping of the product bundle will begin in early October.

"Philips Consumer Electronics has proven to be a strong leader in the development of high-quality, state-of-the-art audio hardware," stated Jeff Conover, vice president of marketing for Sonic Foundry. "We are pleased to be able to offer our expertise in the audio industry with our SIREN[TM] Jukebox technology. This technology, combined with Philip's new innovations, provides a complete and robust personal audio experience."

About SIREN XPress

Sonic Foundry's SIREN XPress is a complete PC jukebox software package that rips and manages audio content. Users can transfer CD collections to their PC and download songs from the Internet, arranging the songs into customized playlists of MP3, WAV, and WMA files. SIREN XPress provides an interactive, user-definable interface. For total control over any music collection, no matter how large, SIREN XPress delivers.

About Philips Consumer Electronics

Royal Philips Electronics of The Netherlands is one of the world's biggest electronics companies and Europe's largest, with sales of $33.5 billion (EUR 31.5 billion) in 1999. It is a global leader in color television sets, lighting, electric shavers, color picture tubes for televisions and monitors, and one-chip TV products. Its 226,900 employees in more than 60 countries are active in the areas of lighting, consumer electronics, domestic appliances, components, semiconductors, medical systems, and IT services (Origin). Philips is quoted on the NYSE (symbol: PHG), London, Frankfurt, Amsterdam, and other stock exchanges. News from Philips is located at www.news.philips.com.