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General Magic Licenses Technology to Microsoft</p>
<p>REDMOND, Wash., and SUNNYVALE, Calif. - (March 4, 1998) - Microsoft Corp.<br />
and General Magic Inc. (Nasdaq "GMGC") today announced that Microsoft has<br />
made a minority investment in General Magic. Agreements between the two<br />
companies include an equity investment as well as the licensing of certain<br />
General Magic technologies. Terms of the agreements include a payment to<br />
General Magic of $6 million.</p>
<p>General Magic is developing integrated voice and data applications, a key<br />
to bringing the next generation of information technologies into the<br />
mainstream. The company's upcoming network service, code-named "Serengeti,"<br />
is a second generation virtual assistant for mobile professionals that goes<br />
beyond offering only voice mail to integrating e-mail, faxes, address book,<br />
calendar, news and stock quote information, all accessible via telephone<br />
using a proprietary Voice User Interface (VUI) or via a Web browser.</p>
<p>Designed to perform and synchronize with several Microsoft applications,<br />
including the Outlook messaging and collaboration client, Schedule + and<br />
Microsoft Internet Explorer, as well as Windows CE-based devices and the<br />
WebTV service, Serengeti is expected to be available by mid-1998. In<br />
addition to its support of Microsoft products, General Magic built its<br />
first Network Operations Center to run exclusively on the WindowsNT<br />
operating system. Chosen for its scalability, robustness and developer<br />
base, WindowsNT was the preferred choice for managing the high volume of<br />
subscribers expected to utilize the Serengeti service over time.</p>
<p>"General Magic continues to develop innovative technologies and<br />
applications," said Nathan Myhrvold, chief technology officer at Microsoft.<br />
"A natural language voice user interface, such as Serengeti's, is a<br />
powerful and flexible way to access information that we think will be<br />
pervasive. Products like Serengeti can provide users with worldwide access<br />
to much of their important information. We are pleased to see General<br />
Magic's integration of Serengeti with Microsoft applications such as<br />
Outlook and Internet Explorer, and General Magic's exclusive use of Windows<br />
NT-based servers in its first Network Operations Center."</p>
<p>"We believe this transaction with Microsoft shows increasing acceptance of<br />
General Magic's products and technologies," said Steve Markman, chairman,<br />
CEO and president of General Magic. "General Magic is all about simplifying<br />
the way people access and control the information they need to be<br />
successful. Our goal is to make Serengeti the preferred service for people<br />
who need access to their information at any time from any location. We hope<br />
to make this technology accessible in a wide range of applications and<br />
devices, and we've taken an important step in that direction."</p>
<p>In accordance with U.S. securities law, General Magic notes that this press<br />
release contains forward-looking statements. There are risks that may cause<br />
actual results to vary materially. These risks include, but are not limited<br />
to, reliance on key technical and management personnel, potential schedule<br />
changes, competitive pressures and emerging Internet standards. Additional<br />
risk factors are detailed in General Magic's 1996 10-K and its third<br />
quarter 1997 10-Q filed with the Securities and Exchange Commission.</p>
<p>Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in<br />
software for personal computers. The company offers a wide range of<br />
products and services for business and personal use, each designed with the<br />
mission of making it easier and more enjoyable for people to take advantage<br />
of the full power of personal computing every day.</p>
<p>General Magic offers products and services that integrate voice and data<br />
technologies making communication and access to information easy and<br />
convenient for people, no matter where they are. The company's development<br />
efforts are founded on its patented agent technology, innovative<br />
user-interface and communication-centric designs to provide simple, yet<br />
effective ways for people to keep in touch with the information they need<br />
to be successful. The company is headquartered in Sunnyvale, California.<br />
For more information on General Magic, please visit the company's Web site<br />
at <a href="http://www.genmagic.com" title="http://www.genmagic.com">http://www.genmagic.com</a>.</p>
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