DivX Acquires MainConcept AG, Leading Provider of H.264 Technology

MainConcept Brings Award Winning Technology and Partnerships to Expanding DivX Ecosystem and Licensing Business

SAN DIEGO & AACHEN, Germany — DivX, Inc. (NASDAQ:DIVX) today announced it has acquired MainConcept AG, a leading provider of H.264 and other high-quality video technologies for the broadcast, film, consumer electronics and computer software markets. The acquisition is a stock and cash transaction valued at approximately $22 million with additional payments of up to approximately $6 million upon the achievement by MainConcept of certain product development goals and certain financial milestones during 2008.

MainConcept designs, manufactures and markets a wide range of high-quality video and audio technology based on industry standards. Its key partners include leading software, entertainment and consumer electronics companies. MainConcept’s portfolio of video technologies, including its industry leading H.264 video codec, is expected to extend the DivX® common media language to additional platforms and formats. The combination of DivX and MainConcept is intended to create a company with substantial scale and resources to deliver products and services that offer the consumer a powerful, yet seamless high-quality media experience.

“We are extremely pleased to add MainConcept to the DivX family,” said Kevin Hell, CEO of DivX. “Company founder Markus Moenig, our new Senior Vice President, has worked with a talented team of engineers to build a successful company with award winning next-generation codec technology that is highly complementary to the core DivX licensing business. MainConcept’s H.264 technology is expected to increase our market opportunity and speed our penetration of key emerging product categories, including mobile, HDTV, set-top boxes and digital still cameras. With this combination, we are executing on our strategy to deliver a seamless and simple digital media experience where any piece of content plays back on any kind of device, and formats and codecs are completely transparent to the end-user.”

“This is a great partnership that we believe will prove beneficial to both MainConcept and DivX,” said Markus Moenig, CEO and Founder of MainConcept AG. “Our product suites and business models are highly complementary, and our combined companies offer a rich solution for the creation, distribution and playback of high-quality video across virtually any platform or device. We look forward to bringing these two great teams together.”

“MainConcept is a solid strategic complement to our high gross margin licensing business,” stated Dan Halvorson, DivX Executive Vice President and Chief Financial Officer. “The increased costs related to operations and the integration of MainConcept could impact our fourth quarter by approximately $0.02 to $0.03 per diluted share. We expect this acquisition to be accretive to our quarterly earnings in the second half of 2008.”