Universal Pictures and Paramount Pictures will establish direct motion picture distribution operations in 15 key international countries beginning in January 2007, as part of a new long-term agreement that extends and restructures their United International Pictures' (UIP) international distribution joint venture. Under the new agreement, UIP will continue to manage all countries outside of North America that are not covered individually by Paramount and Universal. UIP will continue to operate under its current structure and management led by chairman and CEO Stewart Till, and president and COO Andrew Cripps through December 31, 2006. The announcement was made today by Universal Pictures vice chairman Marc Shmuger and Paramount Pictures president worldwide marketing and distribution Rob Moore.

Beginning in 2007, Universal and Paramount will each assume sole ownership and operation of multiple countries currently overseen by UIP. Paramount will wholly own and operate in Australia, Brazil, France, Ireland, Mexico, New Zealand and the United Kingdom. Universal will wholly own and operate in Austria, Belgium, Germany, Italy, Netherlands, Russia, Spain, and Switzerland. In addition, under the restructured agreement, Paramount and Universal will have the option to sub-distribute feature films through each other's operations for a term of up to two years. Universal will continue to distribute DreamWorks theatrical product internationally.

Also beginning in 2007, the restructured UIP joint venture will oversee the direct distribution of feature films in 20 countries, compared to the 35 countries it currently operates, and it will continue to manage all existing licensed countries. There are no plans to shut down any country office in which UIP is currently operating. The 20 countries in which UIP will continue to distribute are: Argentina, Chile, Colombia, Denmark, Greece, Hungary, India, Japan, Korea, Malaysia, Norway, Panama, Peru, Poland, Singapore, South Africa, Sweden, Taiwan, Thailand, and Turkey.

Paramount will base the headquarters of its new international operations in Los Angeles, while Universal Pictures international operations will be headquartered in London. Additionally, Paramount will establish a European regional office.

"This marks the end of an era, but also the beginning of something new and exciting for each of the partners and for UIP," said Marc Shmuger. "Today's announcement ensures that UIP will continue to operate for many years to come, while recognizing the long-term strategic importance for us as a studio to directly control our own international distribution and marketing operations."

"This new venture creates an opportunity for both Paramount and Universal to launch new operations throughout the world from the foundations built by our successful UIP partnership," said Rob Moore. "Our goals of utilizing our global assets to maximize international growth can only be fully realized with this exciting new structure."

"UIP has a long and proud history as the premiere distributor of motion pictures internationally," said UIP Chairman and CEO Stewart Till. "This success has been driven by our tremendously loyal and dedicated staff around the world. Our immediate objective is to continue to achieve uniquely impressive box office results while supporting our partners as they pursue their new long-term strategic objectives."

UIP was formed in 1981 as a joint venture of four major U.S. distributors; Universal, Paramount, MGM, and United Artists, for global distribution of their films. In 2000, MGM/UA exited the agreement, leaving Paramount and Universal as sole partners in the international operation.

Universal Pictures is a division of Universal Studios (www.universalstudios.com). Universal Studios is part of NBC Universal, one of the world's leading media and entertainment companies in the development, production, and marketing of entertainment, news, and information to a global audience. Formed in May 2004 through the combining of NBC and Vivendi Universal Entertainment, NBC Universal owns and operates a valuable portfolio of news and entertainment networks, a premier motion picture company, significant television production operations, a leading television stations group, and world-renowned theme parks. NBC Universal is 80%-owned by General Electric, with 20% controlled by Vivendi Universal.

Paramount Pictures is part of the entertainment operations of Viacom Inc., one of the world's largest entertainment and media companies and a leader in the production, promotion, and distribution of entertainment, news, sports and music.