Microsoft Announces the Expansion of the Zune Entertainment Service to New Platform and Markets

(Reading, UK,— May 27, 2009) Microsoft® today announced the evolution of Zune®, its end-to-end music and entertainment service, to a new platform and new markets. Zune will extend its video service to Xbox LIVE® internationally this autumn. This marks an important development in the Zune strategy and brings the Zune brand to over 17 million international Xbox LIVE subscribers.

Zune will be the premium partner in the Xbox LIVE Video Marketplace, bringing an exciting catalogue of TV and films to the platform and exposing the Zune brand experience to millions of new consumers for the first time. At the Electronic Entertainment Expo next week, attendees will see first-hand how Zune integrates into Xbox LIVE creating a game-changing entertainment experience.

This is the first time Microsoft has marketed the Zune entertainment service in Europe and is also a key step in Microsoft’s strategy to offer consumers a connected Zune experience across three screens (TV, PC and mobile).

“The Zune experience is growing beyond a music player in the U.S. Zune’s international expansion starts with video on Xbox LIVE; eventually we’ll offer the full digital entertainment experience spanning screens, devices, platforms and geographies,” said Chris Stephenson, General Manager of Consumer Marketing for the TV, Video and Music Business.“Delivering on Microsoft’s connected entertainment vision; this news marks a turning point for Zune as it brings cross-platform experiences and premium video content to living rooms around the world.”

With Zune video on Xbox LIVE consumers will have the option to view a wide selection of TV and film content how and when they want: either instant streaming, download to rent or download to own, so you can watch even when you aren’t connected to the internet.

Neil Thompson, Senior Director Entertainment Division UK&Ireland commented:“Xbox customers in the UK&Ireland enjoy music much like a national sport. This introduction of Zune video service to Xbox Live will offer additional even more high definition content continuing our journey to become the leading platform for entertainment experiences.”

In addition, Microsoft today confirmed the next generation of its portable media player, Zune HD. Available in the U.S. only from this autumn, Zune HD is the first portable media player with built-in HD Radio receiver, HD video output capabilities, OLED touch screen, Wi-Fi and an internet browser.

More information on Zune and related images is available at http://www.zune.net/press.

About Zune

Zune is Microsoft’s music and entertainment brand that provides an integrated digital entertainment experience. The Zune platform includes a line of portable digital media players, elegant software, the Zune Marketplace online store, Zune Pass music subscription service, and the Zune Social online music community, created to help people discover more music. Zune is part of Microsoft’s Entertainment and Devices Division and supports the company’s software-based services vision to help drive innovation in the digital entertainment space. More information can be found online at http://www.zune.net/en-us/press.

About Xbox LIVE

Xbox LIVE connects more than 17 million members across 26 countries to each other and the entertainment they love. Home of more content from one remote than can be found from any device connected to the television, Xbox LIVE is also a unified online social network bringing friends together, no matter where they are— in the living room or across the world. More information and Xbox LIVE membership can be found online at http://www.xbox.com/en-us/live.

About Microsoft

Founded in 1975, Microsoft (Nasdaq“MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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