GC PRO COVERS THE COUNTRY: RETAILER ADDS SEVEN NEW REGIONAL SALES OFFICES

Guitar Center, Inc. (Nasdaq: GTRC), America’s leading musical instrument and professional audio retailer, announces its professional audio division, GC Pro, has hired seven new regional Account Managers. The seven new Managers share a wealth of experience representing cutting-edge technologies, products and brands, gathered over decades of industry service. These appointments add a new dimension to the national coverage that GC Pro brings to a changing music recording and audio post-production industry, and underscore the company’s ongoing commitment to providing the absolute finest customer sales support.

The new GC Pro regional sales Account Managers add depth to the company’s already-coast-to-coast customer support coverage. From the Eastern seaboard to the Pacific Northwest, GC Pro has sales support that understands the requirements of what has become an increasingly regionalized pro audio business. The newest team members are: Mitch Shaivitz (Maryland, Virginia and D.C.); Steve Palermo (Pacific Northwest); Rick Rivera (southern New Jersey and Pennsylvania); Ron Shelton (Texas, Arkansas and Louisiana); Paul Henry (Minnesota, Iowa and Nebraska); Dan Scalpone (Illinois, Wisconsin and Indiana); and Shaun Robinson (Northern California).

“The addition of these new Account Managers reaffirms GC Pro’s commitment to its growing base of clients,” comments Tom Menrath, Director of Business Development for GC Pro. “It also reflects the reality of the pro audio business today, one that is increasingly complex and locally based. In an age when music can be made anywhere, the idea that you can serve only the major music and pro audio markets is simply invalid. Similarly, customers benefit from a company that can put veteran sales personnel and stores right into their back yards on a national basis. The pro audio industry has never been as diverse as it is right now. But there’s also never been a company like GC Pro to serve them. Now, no matter where you are, we can grow together.”

The new GC Pro Account Managers are true veterans:
Mitch Shaivitz (mitch@gcpro.com) is well respected in the Baltimore area as a studio owner, recording engineer, live sound engineer and lifelong musician. His experience includes all facets of audio from DAW-based recording to being responsible for the front-of-house (FOH) duties at major venues.

Steve Palermo (stevep@gcpro.com) is GC Pro’s audio guru in the Pacific Northwest. Writing and performing since age 12, Steve’s equipment expertise led him into building custom guitar and bass rigs for The Cure, Bryan Adams, Journey and many other national acts, and he has extensive experience in recording, mixing and mastering in both analog and DAW-based studios.

Rick Rivera (rick@gcpro.com) has over 25 years experience in recording, sound reinforcement, production and touring, as well as an extensive technical knowledge of computers, recording systems and sound systems for all types of venues.

Ron Shelton (ron@gcpro.com) has over 10 years experience as FOH engineer for many types of live venues, and draws from his extensive experience in digital audio production, analog signal processing and system integration to provide his clients guidance and assistance in selecting their audio tools.

Paul Henry (paul@gcpro.com) has spent nearly 20 years listening to and satisfying his clients’ needs in the vibrant and exciting world of live and recorded audio, and is experienced in all facets of how digital audio can be used, including computers and video games.

Dan Scalpone (dan@gcpro.com) received his degree in sound engineering at Columbia College in Chicago. Since 1999 he has worked at Guitar as studio specialist, DAW expert and live sound system designer for the Chicagoland area.

Shaun Robinson (shaun@gcpro.com) draws from his extensive experience in live sound, lighting and mobile DJ. His expertise includes intelligent moving lights, special effects lighting, theatrical lighting, laser systems, atmospheric generators, gobos, trussing and all types of sound reinforcement.

Adobe Buys Macromedia for
$3.4 Billion in Stock

SAN JOSE, Calif., Apr 18, 2005 (BUSINESS WIRE) -- Adobe Systems Incorporated (ADBE) today announced a definitive agreement to acquire Macromedia (MACR) in an all-stock transaction valued at approximately $3.4 billion.

The combination of Adobe and Macromedia will provide customers a more powerful set of solutions for creating, managing and delivering compelling content and experiences across multiple operating systems, devices and media. Together, the two companies will meet a wider set of customer needs and have a significantly greater opportunity to grow into new markets, particularly in the mobile and enterprise segments.

"Customers are calling for integrated software solutions that enable them to create, manage and deliver a wide range of compelling content and applications -- from documents and images to audio and video," said Bruce Chizen, chief executive officer of Adobe. "By combining our powerful development, authoring and collaboration software -- along with the complementary functionality of PDF and Flash -- Adobe has the opportunity to bring this vision to life with an industry-defining technology platform."

Under the terms of the agreement, which has been approved by both boards of directors, Macromedia stockholders will receive, at a fixed exchange ratio, 0.69 shares of Adobe common stock for every share of Macromedia common stock in a tax-free exchange. Based on Adobe's and Macromedia's closing prices on Friday, April 15, 2005, this represents a price of $41.86 per share of Macromedia common stock. Upon the close of the transaction, Macromedia stockholders will own approximately 18 percent of the combined company on a pro forma basis.

In the combined company, Chizen will continue as chief executive officer and Shantanu Narayen will remain president and chief operating officer. Stephen Elop, president and chief executive officer of Macromedia, will join Adobe as president of worldwide field operations. Murray Demo will remain executive vice president and chief financial officer. Dr. John Warnock and Dr. Charles Geschke will remain as co-chairmen of the Board of Directors of the combined company and Rob Burgess, chairman of the Macromedia Board of Directors, will join the Adobe Board.

"Both Macromedia and Adobe are passionate about creating and enabling great experiences across a wide range of devices and operating systems," said Elop. "Our combined teams will be a powerful force for innovation around cutting-edge platforms for delivering content and applications."

Integration

The two companies are developing integration plans that build on the cultural similarities and the best business and product development practices from each company. The companies will make additional details and information about the acquisition available online. (click to view)

"While we anticipate the integration team will identify opportunities for cost savings by the time the acquisition closes, the primary motivation for the two companies' joining is to continue to expand and grow our business into new markets," said Chizen.

The acquisition, which is expected to close in Fall 2005, is subject to customary closing conditions, including approval by the stockholders of both companies and regulatory approvals. The transaction will be accounted for under purchase accounting rules.

Due to the absence at this time of estimates of the acquisition-related restructuring costs and the allocation of the purchase price between goodwill, in-process R&D, other intangibles and equity-based compensation expenses related to SFAS 123R, Adobe is currently unable to provide GAAP estimates on future earnings.

The transaction is currently expected to be break-even to slightly accretive to earnings in the first twelve months after closing on a non-GAAP basis. The company's target of break even-to-slightly accretive to earnings on a non-GAAP basis assumes no adverse impact from the loss of deferred revenue in the first twelve months following the close due to purchase accounting.

Stock Repurchase Program

Adobe also announced its Board of Directors has approved a post-acquisition stock repurchase program of $1 billion. "After a review of the combined companies' financial position, our Board concluded that the repurchase program is consistent with our overall commitment to deliver value to our stockholders," Chizen added.

The repurchase program is in addition to the Adobe's existing stock repurchase programs and is expected to commence following the completion of the acquisition. The repurchases will be funded from available working capital.

Conference Call

The management teams of both companies will host a financial analyst and investor conference call today at 8:00 a.m. ET (5:00 a.m. PT). The call can be accessed at 888-278-5324 (U.S.) or 706-643-3100 (outside U.S.) with conference call ID #5643249. A live Webcast of the call will also be provided at http://www.adobe.com/ADBE and http://www.macromedia.com/MACR. For those unable to listen to the live conference call, a telephone replay will be available at 800-642-1687 (U.S.) or 706-645-9291 (outside U.S.) with conference call ID #5643249. The telephone replay will be available beginning April 18, 2005 at 9:00 a.m. ET through April 20, 2005 at 12:59 p.m. ET. A Webcast archive will also be available on each company's investor relations Web site.

Amazon Breaks Into
Musical Instrument Retailing

New Beta Section Partners With Featured Sellers Sam Ash, Musician’s Friend, Woodwind & Brasswind, Music Yo, zZounds, Full Compass and others.

Quietly within its massive site, Amazon.com has launched a beta section for musical instruments, gear and music software.

To find the new beta, go to www.amazon.com. When the home page appears, in the upper right hand corner, click on See More Stores. Under Electronics and Office, look for Musical Instruments (Beta). Click once and you’re there.

It has six featured categories: Keyboard Instruments, Guitars and Basses, Sound and Recording, Drums and Percussion, Band and Instrument, DJ, Karaoke and Lighting.

To the left of the page is a Browse menu listing Musical Instruments (32 musical instruments are specifically listed), Sound and Recording, Accessories and Related Categories which is primarily instructional works.

To the right of the page are top seller lists for guitars, basses, and keyboards. With a little exploring, you’ll discover that Amazon literally has tens of thousands of products listed. If you ever wanted to see just how big the musical instrument industry is, go here.

Browse through various categories and you’ll find other music retail shops online under the Amazon banner. Some of these include American Musical Supply, Eighth Street Music, audioMIDI, Giardinelli and others.

Much of the pricing follows the standard MAP pricing within the musical instrument retailing (MAP is an acronym for minimum advertised price) which, depending on the product category, averages from 10% to 20% off the list price. However, if you know what you’re looking for, bargains can be had. For example, the Giardinelli company is selling a $759.99 GTR 312 student trumpet and case for $189US, a 75% discount.

With such discounting, music stores that offer to beat any deal as long as its provable in writing, will face some interesting competition from smaller dealers. For example, Cakewalk Sonar 4 Producer Edition lists at $959US, but has a street price of $599 (37% off). But SoftwareWonders, with a 4.6 star customer satisfaction rating has it for $499, brand new in the package, and ships in 1-2 days.  Logic Pro 7 from Apple has a street price of $999.95, but the low price leader in New York is Logistique in New York at $759.95.

Because the musical instrument section is so new, there are few reviews posted for major software and hardware products. Nonetheless, Amazon has added some interesting customer response sections that once picked up on by customers, could bring to bare a greater level of consumerism and focus, that with the exception of a few speciality web sites, has been missing for musical instrument and equipment buying. For example, customers can now share their own customer images for products. For some products, customers can give advice by either recommending the product, an addition to the product, or an alternative (read competitive) solution, which could foster some fairly lively debate among hard core product devotees.

Customer’s whose musical instrument experience has been limited to recorder or acoustic guitar or piano, may find themselves in shock both at the overwhelming choice available. This is especially true on the electronic side of music production, where probing the mystery of what these pieces of equipment are and what they do can be daunting for the amateur musician. Another issue for inexperienced customers is understanding with the electronics what's new and what's old.

This issue leads to one of the stronger customer service issues in music retailing today, which is referring to new customers as either MIDI Idiots or midiots. And here to be wildly successful, Amazon has a real opportunity, if not responsibility, to root this out early by requiring music customers be treated with respect by having more informative sales copy from its partners. 

To bring musical equipment into a more consumer venue and less retail specialty marketing, Amazon may need to post a series of pages with PDFs explaining what some of these pieces are, how they’re used, and how to buy them. This is as true for traditional musical instruments as it is for electronic gear. Is a $99 acoustic guitar just as good as $2300 acoustic guitar? How about a student flute for $149 vs. a handmade Allora for $3295? By the way, who’s Allora?

And that's not a rhetorical question for music equipment purchasers. 

When it comes to buying a refrigerator, customers go to Best Buy or Lowes and see highly advertised recognizable names like GE, Whirlpool, Samsung and others. Name recognition builds trust. But with music being such a cottage industry, there is a lack of brand recognition (outside of Sony or Yamaha possibly) to know who the manufacturers are and whether they can be trusted. After all, reviewing $5000 French horns or $99 in guitars in Consumer Reports isn't exactly commonplace.

There's also the issue that musical instruments, even MIDI keyboards, are tactile. They're designed to be touched and played, and with some instruments, picked up and held during performance like guitar, or flute or French horns.

Thus, for musical instrument and equipment buying, manufacturers are going to have to start looking at branding as a serious issue.

 This is an easy enough fix if Amazon decides to sponsor manufacturer profiles where each company can tell who they are with a link back to their site for more exploring. Allora gives a perfect example of why such an approach is needed. A Google search for Allora brought up everything from a town in Australia to a nudist colony, but no Allora company. But a Google sponsored ad brought up www.music123.com who is selling some Allora products for close to half price.

This means that the brave new world for both customers and manufacturers (moreso than retailers), is doing what consumer companies have been doing for decades - establishing a presence and brand name. Although treated as a commodity purchase, the selling of musical instruments and equipment is truly specialty retailing at it's best, largely because of the shear knowledge behind each product that both the salesman and customer needs to know before buying.

Of course, this is why musical instruments are a beta section on Amazon. But with some care and feeding, along with Amazon’s strong customer service, the new MI section could be a big win for customers, the industry and Amazon.

Avid Technology, Inc. to Acquire Pinnacle Systems, Inc.

Combination to provide Avid with immediate presence in consumer video and expand professional broadcast offerings

Tewksbury, MA – March 21, 2005– Avid Technology, Inc. (NASDAQ: AVID) and Pinnacle Systems, Inc. (NASDAQ: PCLE) today announced that Avid has entered into a definitive agreement to acquire Pinnacle in a cash and stock transaction. Under the terms of the agreement, Pinnacle shareholders will receive .0869 shares of Avid stock and $1.00 in cash for each Pinnacle share. At closing, it is expected that Avid will issue approximately 6.2 million shares and pay $71.3 million in cash, for a total estimated value of $462 million based on Avid’s stock price of $62.95 at market close on Friday, March 18, 2005. Upon completion of the transaction, the 6.2 million shares to be issued to Pinnacle’s former shareholders will represent approximately 15% of Avid’s outstanding common stock. The acquisition is subject to satisfying a number of closing conditions, including shareholder and regulatory approvals, and is expected to close in the second or third quarter of 2005.

The purchase price represents a 30% premium over Pinnacle’s closing stock price of $4.97 on March 18, 2005. Assuming a closing date of July 1, 2005, Avid expects the transaction, excluding acquisition-related charges, to be dilutive to its pro-forma earnings per share in the third quarter and accretive in the fourth quarter, resulting in full-year 2005 pro forma earnings per share of approximately $2.70 per diluted share. In 2006, Avid expects the transaction to be approximately 10 cents accretive, resulting in pro forma earnings per share of approximately $3.20 per diluted share. After payment of the cash portion of the purchase price, Avid expects its cash position to be $280-$300 million at the end of 2005.

Following the closing, the parties expect that Pinnacle’s award-winning professional products – such as the MediaStream broadcast playout server and the Deko on-air graphics system – will enhance Avid’s end-to-end broadcast production pipeline, which has helped Avid become a global leader in that industry. In addition, Pinnacle’s consumer video business – which to date has shipped more than 10 million units -will form the basis for a new consumer video division at Avid, providing the company with an immediate avenue into that segment.

Avid president and CEO David Krall said, “We see this acquisition as the next logical step in our long-term strategy. Just as our acquisition of M-Audio in 2004 brought us into the consumer audio business, by acquiring Pinnacle’s consumer video business, Avid will be able to tap into the next generation of video editors while they are still learning their craft. This creates a very large potential customer base for Avid’s future. At the same time, we believe that Pinnacle’s professional broadcast offerings will fit seamlessly with Avid’s business, extending our end-to-end broadcast solutions with servers and on-air graphics products. We think it would be hard to find a more complementary match for these two businesses than what this combination provides.”

Krall added: “As a result of this transaction, we expect to derive savings from a number of sources, including reducing public company expenses, combining infrastructure functions where appropriate, and providing our global sales teams with a broader portfolio of product offerings. Over the past five years, Avid has increased its profitability and shareholder value by growing our top line, expanding our gross margins, and leveraging our talent and technology across the entire company. By working with the dedicated team at Pinnacle, we’re confident that, together, we can succeed with this same strategy following the completion of the transaction.”

Pinnacle chairman and CEO Patti Hart said, “We believe that this transaction creates significant value for our shareholders and provides excellent opportunities for continued growth for the combined company. Avid has built a strong, well-deserved reputation for efficient business management while continuing to live up to its tradition of technological innovation in the video and audio industries. By bringing our own award-winning products to the table – including Pinnacle Studio, Pinnacle Liquid Edition, and our broad array of broadcast systems – we’re confident that Pinnacle will strengthen and diversify Avid’s business. Our customers can also anticipate a richer set of offerings within an organization that will be even better positioned moving ahead. We see this as the right move for Pinnacle, and we look forward to joining the Avid family. ”

The Boards of Directors of both Avid and Pinnacle have approved the definitive agreement. Avid will seek stockholder approval of the transaction at its annual meeting, and Pinnacle will hold a special meeting of shareholders to consider approval of the transaction. The dates of the shareholder meetings will be announced following completion of initial regulatory filings.

Conference Call

Avid and Pinnacle will hold a joint conference call and simultaneous webcast to discuss the transaction, including the estimated impact on Avid’s future results. The joint conference call will take place on March 21 at 8:30 a.m., EST, and will be open to the public. The conference call can be accessed from any U.S. or international location by dialing (913) 981-5558 and referencing confirmation code 7229543. The call and subsequent replay will also be available on the Avid and Pinnacle Web sites.

AVID LINK TO REPLAY CONFERENCE

About Avid Technology, Inc.

Avid Technology, Inc. is the world leader in digital nonlinear media creation, management and distribution solutions, enabling film, video, audio, animation, games and broadcast professionals to work more efficiently, productively and creatively. For more information about the company’s Oscar®, Grammy®, and Emmy® award-winning products and services, please visit: www.avid.com.

© 2005 Avid Technology, Inc. All rights reserved. Product features, specifications, system requirement and availability are subject to change without notice. Avid, Digidesign, Film Composer, Media Composer and Pro Tools are either registered trademarks or trademarks of Avid Technology, Inc. in the United States and/or other countries. iNEWS is a trademark of iNews, LLC. Avid received an Oscar statuette representing the 1998 Scientific and Technical Award for the concept, design, and engineering of the Avid Film Composer® system for motion picture editing. Digidesign, Avid’s audio division, received an Oscar statuette representing the 2003 Scientific and Technical Award for the design, development, and implementation of its Pro Tools® digital audio workstation. Oscar is a trademark and service mark of the Academy of Motion Picture Arts and Sciences. Emmy is a registered trademark of ATAS/NATAS. Grammy is a trademark of the National Academy of Recording Arts and Sciences, Inc. All other trademarks contained herein are the property of their respective owners.

Pinnacle Systems provides broadcasters and consumers with cutting-edge digital media creation, storage, and play-back solutions for use at Home, in the Studio and on the Air. Pinnacle Systems’ award winning digital media solutions are in use around the world for broadcast, video and audio editing, DVD and CDR authoring and on the Internet. A recognized industry leader, Pinnacle Systems has received nine prestigious Emmy® Awards for its technical innovations and carries this commitment throughout all of its product lines. For more information about Pinnacle Systems products and services, please visit: www.pinnaclesys.com. Pinnacle Systems, MediaStream, Deko, Pinnacle Studio, and Pinnacle Liquid Edition are trademarks or registered trademarks of Pinnacle Systems, Inc. or its subsidiaries in the United States and other countries.

SCARBEE Announces Exclusive Distribution Agreement With Sonic Implants

March 8, 2005 – SCARBEE Professional Audio Tools, a Denmark based maker of award winning sample libraries, virtual instruments, and fx, announced that is has selected Sonic Implants, as exclusive North American distributor of the SCARBEE family of products. Sonic Implants, a Division of Sonic Network Inc., will market and distribute SCARBEE sample library and software products in the United States (including Hawaii, Bermuda, and the Bahamas) Mexico, and Canada.

Serving the music industry since the fall of 2000, SCARBEE products are well known for their detail and playability. Jennifer Hruska founder and President of Sonic Network Inc.  stated “That extra little bit of care that SCARBEE puts in their products to make them sound great, feel great, and play great, makes them a natural fit for Sonic Implants. It's exciting to be offering these great products to our customers," says Jennifer Hruska founder and President of Sonic Network Inc.”

Speaking about the new partnership, Thomas Hansen Skarbye founder and Creative Director of SCARBEE stated “As we launch our new line of virtual instruments with the Vintage Keyboard Collection (VST, DXi, AU & Rewire) it is great to have Sonic Implants' strong partnership to help us serve the North American market."

Sonic Implants is no stranger to the music industry. Founded in 1998 by Jennifer Hruska, of previous Kurzweil fame, Sonic Implants produces their own critically acclaimed award winning sample library line. With the addition of key 3rd party products Sonic Implants will be extending their reach into the sample library and audio software markets.

YAMAHA reaches basic agreement to acquire all common stock of Germany-based Steinberg Media Technologies GmbH from Pinnacle Systems

YAMAHA CORPORATION (with its head office in 10-1, Nakazawa-cho, Hamamatsu-shi, Shizuoka; President: Shuji Ito) announces that it has reached a basic agreement to acquire 100% of the common stock of Steinberg Media Technologies GmbH, a division of Pinnacle Systems, Inc., a California-based maker and seller of video editing systems. The acquisition, which includes Steinberg’s US sales operations, took place through closed competitive bidding on December 20, 2004, US local time.

Founded in 1984, Steinberg Media Technologies is the market share leader in computer software used to produce music. Steinberg became part of the Pinnacle Systems Group in January 2003.

In the mid 1990s, YAMAHA forged a relationship with Steinberg by using its computer music products and bundled software. In April 2004, YAMAHA and Steinberg deepened their cooperative relationship with the Studio Connections initiative, a joint-development project to seamlessly integrate YAMAHA’s hardware products with Steinberg’s software.

Now, YAMAHA has reached agreement to acquire all of Steinberg’s common stock through closed competitive bidding. Eying growth in the music creation market and expanded sales of sound equipment, YAMAHA has incorporated Steinberg’s assets, including its strong technical capabilities in software development and intellectual property, into its Group efforts and further strengthened these activities through joint-development projects. Having determined that Steinberg’s competitive capabilities will be very formidable going forward, YAMAHA decided to acquire all of that company’s common stock through participation in closed competitive bidding.

		Outline of agreement 1. YAMAHA will acquire all of Steinberg Media Technologies’ common stock from Pinnacle Systems. 2. YAMAHA will acquire Steinberg’s US sales business operated by Pinnacle*. * YAMAHA plans for its wholly owned US sales subsidiary Yamaha Corporation of America (YCA) to oversee US sales of software developed by Steinberg. 3. The total acquisition amount is $28.5M. This acquisition will be effective in late January 2005 after the necessary legal steps were all taken. With the acquisition of Steinberg, YAMAHA plans to further promote the Studio Connection initiative and realize seamless technical integration of hardware, such as synthesizers and digital mixers, and software. Another goal of the acquisition is to expand the market by making it easier for both general users and professionals alike to create music in a broad variety of genres.

		Overviews of companies involved
		Steinberg Media Technologies GmbH   Name : Steinberg Media Technologies GmbH Address : Neuer Höltigbaum 22-32, 22143 Hamburg, Germany Established : 1984 Capital ties : Became part of Pinnacle Systems, Inc., in January 2003 Representative : Andreas Stelling Employees : 62 Major business : Development of music software Major products : Digital audio work station software (Nuendo and Cubase) Sales : Approx.13 million euros Total assets : Approx. 4.3 million euros Pinnacle Systems, Inc.   Name : Pinnacle Systems, Inc. Address : 280 North Bernardo Avenue Mountain View, CA 94043, USA Established : 1986 Representative : Patti S. Hart Employees : Approx.1,000 Major business : Manufacture and sales of video editing systems Sales : Approx. $330 million Total assets : Approx. $310 million
Visit Yamaha's website at http://www.global.yamaha.com/index.html