LONDON, 28 OCTOBER 2002 — Universal Music International and Vivendi Universal Net have launched a new joint venture company bearing the name VU Net for Mobile. This alliance is designed to exploit the ongoing potential of the mobile phone market and the worldwide consumer demand for music and entertainment content on mobile phones.

There are 350 million mobile phones in Europe. Young adults represent approximately 45% of this universe and 70 million mobile users are in the 12-24 demographic. It is estimated that, in 2003, European consumers will buy 100 million downloads of mobile phone greetings/dedications, and 150 million downloads of ringtones.

VU Net for Mobile will use UMI’s repertoire to provide content to telephone companies for onward distribution to consumers. This will create additional revenue and income opportunities for UMI and Vivendi Universal, as well as earnings for recording artists.

During the first phase, VU Net for Mobile business units will be established in six European markets: France, UK, Germany, the Netherlands, Spain and Italy. They will be housed in the Universal Music International affiliates in each country.

There will be four primary product offerings from VU Net for Mobile, covering ringtones, logos, dedications, and mailbox personalisation. The first and second of these have already proven their consumer appeal; the third will offer, for example, birthday greetings voiced by recording artists; and the fourth will have, for instance, voicemail messages by artists, which can feature their music in the background.

VU Net for Mobile have appointed Richard Ganter – a senior manager based at the offices of Universal Music International in London within the Strategic Marketing department – to be responsible for music content which the joint venture uses. The role will include liaison with labels, artists and other interested parties, and dealing with artist clearances and other contractual matters.

Commenting on the new venture, Bert Cloeckaert, Senior VP of Strategic Marketing and Commercial Affairs at UMI said, “In this rapidly changing music market, VUNet for Mobile is yet another important step to make sure that we, as a market leader, deliver musical content to consumers, exactly when and where they want it and in the format they expects it to be. I am convinced that by combining VUNet’s expertise with our rich music content and marketing muscle, VUNet for mobile will be ideally placed to turn this initiative into a great commercial success.

Cedric Ponsot, CEO of Vivendi Universal Net For Mobile, said, “Entertainment and music services for mobile telephones is a rapidly developing market which still has a huge growth potential. It’s a very promising sector for Universal Music. Vivendi Universal Net For Mobile is designed to provide mobile operators and customers with strong added value, built on our top quality content and unique marketing and promotional expertise.

“Our position is further strengthened by a series of partnerships with cutting-edge European and Japanese technology companies. Our approach to the market is radically different to that of existing players. Vivendi Universal Net For Mobile is very similar to a ‘mobile radio station,’ creating new ‘programs’ and services on a daily basis and updating these programs at regular intervals. This is a difference that has already been noticed by our European Telecom clients.”

Universal Music International

Universal Music International is a division of Universal Music Group; the world’s leading music company with wholly owned record operations or licensees in 63 countries around the world. Its businesses also include Universal Music Publishing Group, one of the industry’s largest global music publishing operations.

Universal Music Group consists of record labels Decca Record Company, Deutsche Grammophon, Interscope Geffen A&M Records, Island Def Jam Music Group, Lost Highway Records, MCA Nashville, MCA Records, Mercury Records, Motown Records, Philips, Polydor, Universal Records, and Verve Music Group as well as a multitude of record labels owned or distributed by its record company subsidiaries around the world. The Universal Music Group owns the most extensive catalogue of music in the industry, which is marketed through two distinct divisions, Universal Music Enterprises (in the U.S.) and Strategic Marketing & Commercial Affairs (outside the US).

Universal Music Group is a unit of Vivendi Universal, a global media and communications company.