3Com Targets Entertainment Market

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3Com Corp. and PricewaterhouseCoopers will combine their
digital expertise to target the hot entertainment and media markets.

Heading the list of technology initiatives: a decision by
both parties to design and demonstrate a series of digital asset management solutions at
3Com's multimedia lab in Santa Clara, Calif.

3Com, a major supplier of data, voice and video
communications technology, including cable modems, won a major modem contract earlier this
month with Tele-communications, Inc.

Although the Pricewaterhouse arrangement isn't
directly linked to 3Com's cable modem efforts, it will let 3Com test local area and
long distance network solutions, executives said.

Simiarly, the deal will allow Pricewaterhouse, a New
York-based business advisory and consulting organization which merged with the
professional services company Coopers&Lybrand July 1, to distribute and manage high
bandwidth entertainment and media content. This will include rights management, secure use
and reuse of intellectual property and development of worldwide marketing materials.

Pricewaterhouse's participation is the key for 3Com,
executives said. It has the high-profile, high-end clients 3Com covets, and its list
contains virtually all of Hollywood's major motion picture studios.

"We did a significant search for the leading
consultancy firm, and it lead to PricewaterhouseCoopers," said John Marshall, media
and entertainment industry manager for 3Com. "We can provide demos and technology to
their Hollywood studio clients, which can lead to some sort of system integration. Once we
understand the system and network needs, we'll be more involved."

The demonstration lab, Marshall noted, will test a range of
digital assets and management opportunities in an actual network environment where
software tools can be used in conjunction with creative digital content.

"We want to include other technologies and products as
well. This is the first lab of its type," he said.

The lab will be connected to test sites in Los Angeles and
major cities worldwide, and gives 3Com a higher profile in the lucrative entertainment and
media businesses. Later this month, the lab will conduct its first demonstration of how to
customize and deliver video content.

Companies such as Sun Microsystems Inc., Oracle Corp. and
MediaOne Group will provide the hardware, software and connectivity needed to conduct
tests at the demonstration center, and executives will view software which has been
evaluated and chosen by PricewaterhouseCoopers and 3Com as "best-of-breed"
entertainment and media applications.

"These technologies will focus on content management
for business, not home delivery. They will have a play in the consumer world, but they are
more broadly focused to business and on content management, not delivery," said Steve
Abraham, global managing partner of entertainment and media consulting for
PricewaterhouseCoopers.

PricewaterhouseCoopers and 3Com will focus on lashing
together four key technological areas at the demonstration lab:

• High performance servers that can deal with large
volumes of data;

• Hardware and software technology surrounding
compression to reduce it to a more manageable scale;

• Software technology used to manage multi-media data
bases and content;

• The need to map content into different formats. For
example, re-formatting films for airline showings.

"Entertainment and business are overlapping more and
more, and we have a presence in both," Abraham said. "3Com is interested in high
bandwidth and we want to showcase our efforts in digital asset management. Our agendas
really matched up."

Industry observers point to rising production costs,
reduced time to market, new revenue streams through licensing and cross merchandising, and
increased complexities in intellectual property rights, as incentives for industries such
as entertainment and media to look at digital asset management. Most agree that the
entertainment and media industries are prime candidates to use digital asset management
because of their high priced media content.

"The demand for digital asset management is in the
entertainment industry," said Antonette Goroch, senior analyst for the Carmel Group,
a media research and consulting group in Carmel, Calif.

"3Com has the technology, PricewaterhouseCoopers has
the media clients and Hollywood has the money, with the business community to follow. And
the cable industry should benefit from the refining of technology and eventual lower
prices," Goroch said.

The entertainment industry has been first out of the gate
with digital assets such as video trailers, commercials and other media footage, and its
appetite for digital is growing. Digital technology allows media companies quicker
distribution of digital photos, video text and other assets which are readily available
from a data base.

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