Macrovision Ben Hier Dave Light April 22, 2008

Agenda: 1. Position Background 2. Macrovision Overview 3. Gemstar Acquisition 4. Gemstar Overview and Financials 5. Macrovision Financials 6. Recommendation

Position Background Bought 200 $75 (April 2000) Bought 300 $25.04 (April 2007) Sold 200 $26.40 (November 2007) Chart from Google Finance:

Macrovision Focus: Empowering customers to enable consumers to enjoy digital media on their terms Leading Technology IP Licensing Provider Core technologies: protection, distribution and enhancement Focus on creating recurring revenue Macrovision (2007). Annual Report From SEC EDGAR database Macrovision Lenders Presentation. April 9, 2008

Macrovision: Entertainment Business Unit Allows Producers and Operators to safely deliver and distribute entertainment Ensure the users pay for each use Prevents copying of content Customers pay one-time fee and/or recurring fees depending on content structure Macrovision (2007). Annual Report From SEC EDGAR database Macrovision Lenders Presentation. April 9, 2008

Macrovision: Embedded Solutions Business Unit Focuses on consumer electronics Content protection Media Enabled Devices Sells directly to CE Manufacturers For enabled devices, users pay per unit royalties Macrovision (2007). Annual Report From SEC EDGAR database Macrovision Lenders Presentation. April 9, 2008

Macrovision (spark notes): Macrovision (2007). Annual Report From SEC EDGAR database Macrovision Lenders Presentation. April 9, 2008 Manages complexity of selling content online Helps customers protect and license digital content Helps customer grow revenues by selling content through more distribution channels Ensures product lines are optimized for the digital home (use on multiple devices)

Macrovision’s Strategic Investments & Divestitures Acquired Company Purchase Price Sale PriceSold to: Trymedia$34M (2005)$4M (2008)RealNetworks Digimarc (12.5% Stake) $25.3M (97-00)$17M (2008)Private Equity Software Division*Various$200M (2008)Thoma Cressey Bravo

Macrovision Agrees to Buy Gemstar $2.8B Transaction 51% MVSN Approval Needed & 67% GMST Needed 56% Cash ($1.6B) / 44% Stock ($1.2B) GMST - $6.35 in cash or.2548 MVSN Pro Forma Ownership Macrovsion (53%) / Gemstar (47%) MVSN will raise $650M in debt $500M Term Loan & $150M (Senior Unsecured “High Yield”) Corporate Ratings: Ba3/B+ (Stable/Positive) Senior Secured: Ba1/BB- Pro Forma Leverage 4.3X 2007 Adjusted EBITDA Junk Rating Company Presentation to Lenders 4/9/08

Deal Impact No indication by MVSN management regarding accretion/dilution Estimate $46M in synergies within 270 days $30.627M related to headcount reduction “Top-line synergies are likely to remain limited.” - Goldman Sachs’ Sasa Zorovic Barron’s Online 12/10/07 Company Presentation to Lenders 4/9/08

Going Digital Company Presentation to Lenders 4/9/08

Gemstar TV Guide Gemstar is a global media, entertainment, & technology company Leading provider of video guidance TV, Print,& New Media Properties NASDAQ Listed (GMST) News Corporation (NWS) owns 41% of (GMST) July 2007 – “Explore Strategic Alternatives” MVSN Sole Bidder K

Gemstar’s Segments Segments (FY December 31, 2007)% RevenuesGross Margin Guidance Technology & Solutions45%65% Media Networks32%18% Publishing23%-14%

Gemstar TV Guide Price$4.94 Market Cap$2.12B 2006 EPS$ EPS (Ex-Tax Benefit)$ Estimated EPS (Model)$0.17 Adjusted P/E (TTM)31 Forward P/E (Model)29 Beta1.20 Google Finance

GMST Valuation

Macrovision Price$14.19 Market Cap$767MM 2006 EPS$ EPS (Ex-Tax Benefit)$ Estimated EPS (Model)$0.71 P/E (TTM)24 Forward P/E (Model)20 Beta1.38 Google Finance

Macrovision DCF Beta from Yahoo Finance ( Rd from Macrovision (2007). Annual Report From SEC EDGAR database

Macrovision DCF Under our most accurate model Current Stock Price: DCF Valuation: Utilizes optimistic WACC Low beta of 1.38 (Google Finance = 2.13) Optimistic about earnings potential in Jump from $0.58 to $0.71

Conclusion Major Acquisition Both companies trading above their current DCF valuation Lack of proven managerial expertise Larger, more diversified company Utilizing debt for the first time Sell 300 shares at the market