IBM AND PHILIPS ANNOUNCE CO-OPERATION ON OS/2 WARP AND CD-i/PC

November 22nd, 1994.......IBM and Philips announced today their
co-operation on IBM OS/2 Warp and the Philips CD-i/PC playback board.

This combination offers the user the latest, most advanced software capable
of running almost all programs for IBM compatible computers plus full CD-i
functionality and access to the hundreds of CD-i titles which include
films, music videos, and games.

The two companies are developing joint marketing programmes. Philips Media
will include the OS/2 Warp product with its CD-i/PC kit in selected
channels.

In a reaction, Frank Pauli, Senior VP for Professional Markets Philips
Media IMS, stated that this combination of both technologies results in a
truly new product and the combined marketing powers of both organisations
will drive the success in the market.

IBM's Colin Reid, Director of Personal Software Marketing added, "The
number of people using OS/2 Warp at home is expanding rapidly and we are
delighted that they will be able to enjoy CD-i from Philips in this
integrated fashion. We believe this joint venture marks another milestone
in OS/2 Warp's progress into the home, but more importantly it offers our
customers the advanced multimedia function they demand in an uncomplicated
package."

The CD-i/PC Playback Board turns any industry standard PC into a fully
featured CD-i player, in combination with the Philips LMS CM 208 quad
speed CD-ROM drive. With this addition the PC gains full CD-i compatib-
ility, enabling access to all CD-i titles which are already on the
market.

Within the established CD-i standard, the PC can then play MPEG-encoded
digital video from either interactive CD-i discs or Video CDs carrying
linear-play movie titles. No other MPEG-based video board offers this full
CD-i compatibility. Next to that it also plays Photo CD, CD-Audio and CD
graphics software.

OS/2 Warp runs DOS, Windows and OS/2 programs in a single environment. Its
true multitasking allows the user to run multiple programs simultane-
ously and the vastly enhanced user interface and animated icons make
computing not only easy but fun.

An extensive BonusPak completes the new version of OS/2 with a range of
additional software. The BonusPak is supplied free of charge with all
sales of OS/2 Warp. It contains video comferencing software, fax and
communications software, Internet connection and an integrated word
procssing, spreadsheet, charting, data filing and report writing programs
plus a multimedia viewer and video editor.

Contacts:

   PHILIPS:  Marijke Van Hooren + 31 40 734 866 (Holland)
   IBM:  Claire Wilkins +44 256 343574 (UK)

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