June 29, 2003 4:00 PM PDT

RealNetworks jumps onto Vodafone

RealNetworks on Sunday announced an agreement to power audio and video playback on certain handsets offered by British cell phone giant Vodafone.

The deal allows Vodafone to use RealNetworks' media playback technology for its Vodafone Live service, which provides subscribers with ring tones, interactive games and, eventually, audio and video content. The cellular company plans to deliver media content encoded in technology from RealNetworks, among others, to subscribers in Europe by the beginning of next year.

Vodafone will initially offer these features on Nokia's Series 60-based phones, according to a RealNetworks representative.

This is RealNetworks' latest distribution arrangement with a mobile phone service. Since the beginning of the year, the Seattle-based software maker has struck deals to provide media playback technology to cell phone giant Ericsson and to deliver streaming media programming to Nokia 3650 phones used by subscribers of U.S. carriers AT&T Wireless, Cingular and T-Mobile.

In addition, RealNetworks has been streaming programming from its RealOne subscription service to mobile devices running Microsoft's Pocket PC operating system since last year.

Cell phone deals are critical for RealNetworks, because it is vying for market share against archrival Microsoft. RealNetworks has watched the software giant's Windows Media playback and encoding technologies gain market share on the PC desktop over the past few years, leaving the relatively new mobile territory ripe for expansion.

"Mobile phones play a much more important role with consumers outside of the U.S. and Canada than do PCs," Dan Sheeran, vice president of marketing at RealNetworks, said.

Financial details of the deal were not disclosed, but RealNetworks will get 25 cents for every phone packed with its media player.


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