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Microsoft Player to Use SRS Technology

Computers: It's the first inclusion since the Santa Ana firm's March alliance with the software giant.

May 03, 2000|From Bloomberg News

SRS Labs Inc. said Tuesday that Microsoft Corp. will use its audio-enhancement technology in its Windows Media Player 7 software for playing audio and video files from computers and the Internet.

It's the first time Microsoft has included the Santa Ana firm's technology under an alliance the two companies formed in March. At that time, the software maker paid $5 million for 290,000 SRS shares, or a 2.4% stake, SRS Corporate Controller Desmond Allen said.

SRS shares fell $2.13, or 13%, to $14.75, in Nasdaq trading. The stock has more than doubled this year.

Microsoft is using SRS' WOW technology, which makes small computer speakers sound bigger and less tinny, said Jennifer Drescher, SRS marketing vice president.

Windows Media Player 7 software will include a logo linking users to the SRS Web site. With more than 100 million earlier copies of Windows Media Player licensed, SRS expects many users to upgrade to the latest version.

"With the logo, we'll be able to promote the company and generate traffic to a Web page that gives more information about our technology," Drescher said.

The SRS logo will be linked to the company's live music site,, when it starts in June, and the traffic is expected to draw advertising revenue to the site, she said. A free preliminary version of Microsoft's Windows Media Player 7 was available for download Tuesday, Drescher said.

WOW's so-called "psycho-acoustic technology" is based on the human hearing system and restores the three-dimensional sound to reproduced music, Drescher said.

SRS audio and voice technology is licensed by more than 150 companies, including consumer-electronics maker Sony Corp. and Dell Computer Corp.

The company last month said its first-quarter loss widened to 36 cents a share, of which 26 cents were charges related to giving Microsoft a discount on its stake and granting the software maker warrants.

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