Private Media Group and Zone Vision Enterprises Announce Joint Venture Agreement

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Source: Private Media Group Inc.

(BARCELONA, Spain) — Private Media Group Inc. (Nasdaq: PRVT – news), a leader in high-class adult entertainment products and services since 1965 and the first such company trading on the NASDAQ National Market, today announced it signed an exclusive joint venture agreement with Zone Vision Enterprises, a UK based television broadcasting company. The agreement allows for the co-operation of both Companies for the purposes of creating a new adult television channel to be called Private Blue.

Zone Vision Enterprises (ZVE) owns 100% of Broadcasting (UK) Limited which currently broadcasts an adult entertainment channel in the United Kingdom known as Midnight Blue. Under the terms of the joint venture agreement ZVE, in return for Private providing viewing content and trademarks, will ensure the promotion and broadcast of the channel. The existing Midnight Blue soft erotic channel will be re-branded to include the Private name thereby immediately providing a ready made audience for the channel on the Sky digital and analogue platforms in the United Kingdom. Zone Vision intends to extend distribution of the channel throughout Europe and there are further plans to extend into Latin America, the Far East and Africa. Private Media Group will receive 35% of net profit generated from the broadcast of, and advertising on the channel. Included within the Agreement is an option for Private to acquire 35% of equity, at face value, in the Private Blue channel.

Although the current channel was only launched in July 1999 these buy rates are comparable if not higher than those of major competitors in the initial stages following their launch seven years ago. Transmitting from 10pm to 4am nightly, the pay-per-view channel will broadcast quality adult entertainment. From April 5, Private Blue will be immediately available to 5 million subscribers and Zone Vision will continue to manage the promotion and broadcast of the channel from its London headquarters.

The newly branded Private Blue channel will immediately benefit from the extensive marketing arrangements that have been concluded in the United Kingdom. It will be advertised in the Daily and Sunday Sport magazines, selected erotic magazines as well as in the Sky View and sky TV guides. The television channel will also promote and advertise the Private Internet sites and the full range of Private products from fashion-wear, video, publications, TV-shopping and energy drinks. Increased marketing activity will follow as revenues increase with the growth of digital subscribers.

Berth Milton CEO of Private Media Group said: “We have enjoyed unprecedented publicity in the United Kingdom over the last twelve months having featured on several national television channels and newspapers. Our web-site traffic has realized a huge growth in the UK recently. We have also commenced distribution of our Private Dynamite energy drinks and our Private Circle fashion-wear showcased this February at the 40 Degrees Fashion Show at Earls Court in London. Furthermore, during the end of last year the UK Edition of the publication Private Life was launched and now with Private television our commercial presence in the UK really is at an all time high. The channel will broadcast the contents of Private Media Group’s successful 35 year back catalogue, again highlighting the commercial value to the Company for retaining full ownership right.”

Chris Wronski, Zone Vision CEO added: “The combination of the outstanding Private catalogue and our vast experience in the production of thematic channels will create unprecedented accessibility to top quality adult programming. Together we will create a brand new quality in home adult entertainment allowing viewers to have access to the best erotic channel from the comfort of their own sofa.”

Zone Vision is one of the leading broadcasters and distributors of thematic channels in Europe. Since its launch in 1991, the company has developed a pre-eminent market position as a broadcaster and distributor of international channels and programs. In addition to Private Blue, Zone Vision’s other channels include Reality TV, Romantica, Telewizje Miejskie, Le Cinema, E! Entertainment and Fantastic. Zone Vision’s channels are now available to over 16 million viewers across Europe and will shortly be available in other territories throughout the world. Carefully targeted to meet industry requirements and audience expectations the range of Zone Vision’s channels has rapidly developed a high level of audience loyalty making them an invaluable part of many broadcast platform. Zone Vision is also rapidly expanding new business opportunities such as Internet services as well as the provision of state-of-the-art, pan European, post-production facilities and language versioning studios.

With headquarters in London, Zone Vision currently has nine regional offices in Warsaw, Bucharest, Moscow, Budapest, Prague, Sofia, Zagreb, Jerusalem, Kiev, Amsterdam and Luxembourg employing over 250 specialist personnel.

Private Media Group Inc. commenced operations in 1965. Its primary business activities today include the creation, refinement and delivery of proprietary Internet sites and the licensing of its library content and brand name for Internet sites and broadcasting transmission; the acquisition, refinement and delivery of adult feature products, including unrated and adult feature DVD’s, magazines, videos, and CD-Roms; the distribution and licensing of Private’s total proprietary range on the Internet, including DVD’s, magazines, videos, interactive services and Private Circle fashion line; the licensing of its internationally reputable brand name for product lines, including adult novelty ranges such as Private Collection; the production and control of distribution rights to its Private Dynamite energy drink; and TV Home Shopping for Private’s proprietary and licensed products.

For more information, visit the Company’s corporate web site at www.prvt.com

This release contains, in addition to historical information, forward-looking statements within the meaning of Section 27 A of the Securities Act 1933, as amended, and Section 21 E of the Securities Exchange Act of 1934, as amended, which reflect the Company’s current judgements of those issues. However because those statements are forward-looking and apply to future events, they are subject to such risks and uncertainties, which could lead to results materially different than anticipated by the Company.

For more information, please contact: In Barcelona, Spain, Johan Gillborg of Private Media Group Inc., +34-93-590-7070, johan@milcap.es; or in London, England, Adam Reynolds of Hansard Communications.Com, +44-207-840-7782, adam.hansard@clsholdings.com; or in Los Angeles, California, Fran Daniels of Financial Sciences of America, 310-278-4413, finsci@earthlink.net.