USVO Developing New Anti-piracy Product
Thursday, 19 October 2006
(Niantic, CT – October 19, 2006) – USA Video Interactive Corp. (OTCBB: USVO; TSX: US; BSE/Frankfurt: USF) announces development of its new anti-piracy product, MediaEscort^TM. Building upon USVO’s proprietary SmartMark™ digital watermarking technology, MediaEscort is designed to meet Hollywood's need to protect their online movie distribution from piracy.

2006 has seen a tremendous surge in companies deciding to distribute and sell video content over the Internet. Digital delivery of video grew rapidly after Apple Computer Inc. announced last October that five popular television shows would be available through its iTunes online store. Since then, numerous other companies have announced they too are making their video content available to consumers on the Internet.

With video content being distributed over the Internet, piracy remains a great concern. MediaEscort is designed to meet the needs of this new market segment. The Motion Picture Association of America states the worldwide motion picture industry, including foreign and domestic producers, distributors, theaters, video stores and pay-per-view operators lost $18.2 billion in 2005 as a result of piracy. Companies use DRM (Digital Rights Management) to control and/or restrict the use and access of digital media content on electronic devices to prevent illegal copying. However, no DRM system is impervious to circumvention, as was reported recently by BBC News, when a program called Fairuse4wm was posted on the Internet and was said to be capable of bypassing Microsoft's DRM system. USVO believes watermarking is the best long-term solution for combating piracy. Since it does not impede consumers’ rights to fair use, and it stays invisibly within content so that it could be used to trace back to a pirate.

"Ultimately all distribution will be in a digital file based format. MediaEscort is our effort to make this type of distribution supported, and protected by a cost efficient embedding of SmartMarks. We have specified an application based on extensive conversations with distributors and prospective customers about their business models and workflow," said Patrick Gregston, Head of Sales for USVO.

"We have seen USVO’s SmartMark technology satisfactorily evolve over the years from MediaSentinel to now MediaEscort. MediaSentinel has been successfully tested on content distributed by broadcasters and IPTV in India. We believe that MediaEscort truly represents a revolution in digital watermarking as it would be possible for us to deploy watermarking real-time and live, while streaming the content on the Internet and for transmission by broadcasters," said Munish Gupta, President of Ethnic Communications LLC. Gupta said that his two other companies, www.IndiaTVLive.com and www.PIOTV.com, India’s first IPTV platform and the world’s first TV channel for (the Indian) expatriate community, are set to deploy MediaEscort.

MediaEscort is a software application that resides on customer’s video servers. It will automatically and seamlessly embed SmartMarks—invisible forensic information in every frame of video content—during Internet delivery, providing the proof courts need to protect intellectual property rights, indicting and convicting the individuals who steal the original material.

SmartMark resists attacks by would-be pirates using techniques including collusion, digital-analog-digital conversions, re-sampling, dithering, compression and recompression, and a number of other processing methods. Attempts by pirates to defeat SmartMark encoding renders the content virtually unusable, making piracy very unattractive.

Using MediaEscort, copyright holders will be able to protect their content without restricting the fair uses of legitimate customers, including copying, archiving, and enjoying the content on different platforms at different times. MediaEscort’s SmartMarks work across all distribution and presentation channels and technologies, seamlessly providing an entire system for piracy protection without frustrating consumers, who will continue to have the freedom to enjoy content in their own way. In addition, MediaEscort’s SmartMark process will be fully compatible with DRM.

Upon final release of MediaEscort, USVO will issue a subsequent announcement, containing further product and technology details.

About USVO:
USA Video Interactive Corp. ("USVO") designs and markets technology for delivery of digital media. USVO developed its MediaSentinel^TM and SmartMark^TM digital watermarking technology to provide a robust means for producers and distributors to invisibly protect their content. USA Video Technology Corp., a wholly owned subsidiary of USVO, holds the pioneering patent for store-and-forward video, filed in 1990 and issued by the United States Patent and Trademark Office on July 14, 1992; it has been cited by at least 165 other patents. USVO holds similar patents in Germany, Canada, England, France, Spain, Italy, and Japan. For more information, visit www.usvo.com.

USA Video Interactive Corporate Headquarters Office: 8 West Main Street, Niantic, Connecticut, 06357 Telephone (860) 739 - 8030 Facsimile (860) 739 - 8070;
Canada Office: 507 – 837 West Hastings Street, Vancouver, BC V6C 3N6. Trading symbol on the OTCBB: USVO; Trading symbol on the TSX Venture Exchange US; Trading symbol on the Berlin and Frankfurt Stock Exchanges: USF. CUSIP 902924208. For more information contact (860) 739 – 8030 x125 or .

The press release may contain forward-looking statements. Actual results may differ materially from those projected in any forward-looking statements. Investors are cautioned that such forward-looking statements involve risk and uncertainties, which may cause actual results to differ from those described.

MediaEscort, MediaSentinel and SmartMark are trademarks of USA Video Interactive Corp.
The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Last Updated ( Thursday, 15 February 2007 )