iesy Repository GmbH - Irish Stock Exchange

iesy currently intends, depending on the outcome of the negotiations with MSG, to procure the digital platform services
necessary for the distribution of the foreign-language and English language packages from MSG under the agreements
currently being negotiated.
KDG
KDG licenses certain IT systems to iesy relating to network component tracking (SMILE-BK) and billing and customer
care for iesy’s Level 4 subscriber base (Powerkabel). iesy plans to have the SMILE-BK system upgraded during 2005 under a
new license agreement with KDG. In this respect, KDG and iesy entered into a letter of intent for the migration from SMILE-
BK 1.5 to SMILE-BK 2.0 in April 2005. According to this letter of intent, the new agreement shall run until March 31, 2008.
The Powerkabel system which iesy inherited from its acquisition of DeTeKS Hesse, will not be supported by KDG beyond
December 31, 2005, and iesy intends to have integrated this functionality into its ICMS system by that time.
CSG
CSG provides maintenance services for our billing system software, CSG Integrated Customer Management System
version 5.1 (“ICMS”). These services include: supply of patches and updates, provision of telephone support, telephone and
email assistance, and provision of third party software upgrades.
Competition
The cable television and Internet services industries are competitive, and iesy faces significant competition from
established and new competitors in these areas. See “Risk Factors—Risks Relating to Our Business—We operate in
competitive industries, and competitive pressures could have a material adverse effect on our business” and “Industry-
Competition.”
Intellectual Property
The operators of telecommunications cable networks are required under the German Copyright Act (Gesetz über
Urheberrecht und verwandte Schutzrechte) to acquire rights for the retransmission of radio and television programs that
include, among other things, literary, scientific or artistic work protected by copyright law. In case there is no agreement on
the rights for the retransmission, the retransmission may be prohibited by an injunction. Claims for royalties can exclusively
be asserted by the German collecting societies (Verwertungsgesellschaften) and not by the holders of copyrights or related
rights themselves. As an exception, however, broadcasters have the choice to assert their rights individually or via a
collecting society.
GEMA, one of the German collecting societies, has been mandated by most of the relevant German collecting societies
to collect royalties from the telecommunications cable network operators. The large German private broadcasters, however,
mandated VG Media to assert their royalty claims based on their cable re-transmission rights. The amount of the royalties due
is not determined in the Copyright Act.
On November 21, 1991, the legal predecessor of DTAG concluded agreements with the German public broadcasters,
the German private broadcasters, certain foreign broadcasters and GEMA (acting both on its own behalf and on behalf of
other relevant German collecting societies). These agreements governed the collection by GEMA of royalties for, among
other things, literary, scientific or artistic works protected by copyright law that were included in radio and television
programs re-transmitted through the telecommunications cable networks that are today operated by the regional cable
companies. In 2000, a dispute over the amount of royalties to be paid to GEMA and to the German private broadcasters
arose, and the existing agreements were terminated with effect from December 31, 2002. The parties involved entered into
lengthy negotiations leading to the following settlements:
The Level 3 operators, the German public broadcasters, a number of small private German radio and television
companies, certain foreign broadcasters and GEMA (acting both on its own behalf and on behalf of these private and foreign
broadcasters and the other relevant German collecting societies except for VG Media) agreed to amend and reinstate the
agreements that had previously been terminated with effect of January 1, 2003. The new agreements cover analog and digital
transmission and will remain in force until December 31, 2006.
ish, the other Level 3 operators and VG Media entered into an agreement regarding the acquisition of rights for the retransmission
of radio and television programs that include, among other things, literary, scientific or artistic work protected
by copyright law, through the telecommunications cable networks of the regional cable companies. This agreement came into
force on January 1, 2003 and may be terminated by each party on December 31, 2005, at the earliest. On March 22, 2005, as
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