REALNETWORKS STATEMENT REGARDING EUROPEAN COMMISSION RULING AGAINST MICROSOFT

Seattle, WA — RealNetworks®, Inc. (NASDAQ: RNWK), the leading creator of digital media services and software, reacts to the European Commission’s decision regarding Microsoft’s continuing anti-competitive behavior:

Bob Kimball, Vice President and General Counsel, RealNetworks:

"This decision is fundamentally significant because the European Commission has formally declared that Microsoft’s media player bundling strategy is illegal and has established the guideposts for future bundling cases. This is the first legal review of Microsoft’s media player bundling practice. While we have not yet seen the complete decision, we support the European Commission’s efforts to provide European consumers with all the benefits of a competitive marketplace, including choice in digital media products. RealNetworks welcomes the opportunity to compete on a more level playing field because when that is the case, consumers have the benefit of innovation and products like our RealPlayer 10 win.

The European Commission, after a thorough investigation, becomes the third prominent legal body to find that Microsoft has illegally abused its monopoly power. The decision confirms the merit of our own U.S. lawsuit, which addresses Microsoft's illegal tactics including bundling its media player with its monopoly operating system. Building on the Commission’s factual findings establishing Microsoft’s illegal conduct, we intend to vigorously pursue our case in the U.S. to obtain injunctive relief sufficient to stop all of Microsoft’s illegal conduct as well as to secure compensation for the harm Microsoft has done to our business.

Despite that, RealNetworks continues on a path of revenue expansion, building on six consecutive quarters of revenue growth. We are on course and pursuing the diversified business strategies that have led us to a leadership position in digital music, downloadable games and digital media technology for mobile markets."

For More Information:
Media contact: Greg Chiemingo, 206-892-6234, gchiemingo@real.com
Investor contact: Erika Shaffer, 206-892-6191, eshaffer@real.com

ABOUT REALNETWORKS
RealNetworks, Inc. is the leading creator of digital media services and software including the award-winning Rhapsody® Internet jukebox service and RealPlayer 10. Consumers can access and experience audio/video programming and download RealNetworks’ consumer software at http://www.real.com. Broadcasters, network operators, media companies and enterprises use RealNetworks’ products and services to create and deliver digital media to PCs, mobile phones and consumer electronics devices. RealNetworks’ systems and corporate information is located at http://www.realnetworks.com.