ROO Group Announces Operational Streamlining


NEW YORK, Jan. 14 / -- ROO Group today announced a plan to accelerate its path to profitability and refocus the Company on a device-agnostic IPTV enablement strategy in international markets.

Chairman and CEO Kaleil Isaza Tuzman said, "We are taking operational steps to improve the short-term performance of ROO Group by focusing on revenue generating initiatives in our core business, while exiting non-core activities and reducing our cost structure."

Isaza Tuzman continued, "The first step on the revenue side for 2008 entails increased sales focus on markets outside of North America, where IPTV demand is strong but the competitive landscape in IPTV enablement is underdeveloped. At the same time, we are implementing cost-cutting activities and prioritizing fiscal discipline in our home market. We believe that these initial steps in our 2008 realignment will have a beneficial impact on the bottom line and enable us to hit profitability in the second half of the year."

Cost Reductions
Shut-Down of ROO Business Solutions Unit (RBS)

On Thursday, January 10, 2008, ROO Group closed its RBS business unit based in Clifton Park, NY, and shut down corresponding peer-to-peer (P2P) networking development in the Company. These actions included a staff reduction of approximately 10 people. The Company will be renegotiating its lease obligation in Clifton Park and eliminating associated technology services and overhead costs. Management believes that exiting the RBS unit, which was in the research and development stage, will focus the Company's activities on its core international IPTV enablement business, and reduce 2008 expenses without negative impact to revenue growth.

Isaza Tuzman commented, "Our goal is to provide our clients with the most efficient and cost effective delivery system available; and as such, we will provide P2P options for our clients through business alliances with P2P providers as opposed to developing these competencies internally."

Net Reduction of Executive Staff and Third-party Service Provider Costs
ROO Group has begun reducing current executive-level staff and costs associated with third-party service providers while adding new executive staff to spearhead content delivery efficiencies and revenue generation in new geographies. In line with the Company's increased focus on international business development, the Company has reduced total workforce by 43 employees and full-time contractors (70% from the US workforce) over the last several weeks, which includes the RBS business unit and previously announced reductions.

Reduction of Streaming Costs
ROO Group will aggressively seek to reduce live and video-on-demand (VoD) streaming costs through the renegotiation of existing provider contracts and through organic development or acquisition of a proprietary content delivery infrastructure (CDN) for both live streaming and VoD capabilities.

Isaza Tuzman stated, "We expect the initiatives set forth today to allow us to transform ROO Group into a more efficient and focused organization. The gross cost savings for recent initiatives, including staff reductions, are expected to be in excess of US$400,000 per month, with a net reduction of approximately US$3.5 million in 2008, after severance costs, KIT Capital services and additional executive hires.

Competitive Re-Focusing
Increased Focus on International Markets and Device-Agnostic B2B Platform Approach

In 2008, ROO Group will enhance its focus on geographic markets outside of North America, where management believes the IPTV enablement landscape is more fragmented and market share consolidation is attainable.

The Company plans to relocate its corporate headquarters, including major executive functions, by the end of 1Q 2008, while maintaining a sales and product development presence in New York. This relocation will further streamline ROO Group's operations and reduce corporate overhead.

In line with the Company's strategy of being a device-agnostic IPTV enabler, ROO will also assess initiatives towards enabling its platform to support multiple CODECs, set-top boxes and mobile devices. The Company is likely to pursue an acquisition-augmented growth strategy in particular as it relates to mobile TV ingestion and delivery.

Management has also begun to assess the merits of introducing a new corporate brand to better reflect its international B2B focus and device- agnostic approach.

New Executive Hires
ROO Group announced today the hiring of three new executives: Sean Coutts, Nigel Regan and Ivan Dario Arias.

Sean Coutts will head up Global Network Operations and Product Management for ROO Group. Prior to joining ROO, Mr. Coutts served as JumpTV's Head of Business Operations, responsible for global CDN infrastructure, including end- to-end signal acquisition and distribution, as well as programming, rights compliance and content substitution processes. Prior to joining JumpTV, Mr. Coutts managed global operations at Open Text Corp., which included Help Desk, Infrastructure and Global Application Development units, and also played a central role in the due diligence and integration of over 16 acquisitions. Mr. Coutts will start in his role at ROO on February 11th, based in the Company's New York office.

Nigel Regan will be joining ROO Group to lead Distribution efforts for the European, Middle Eastern and African (EMEA) zone. Prior to joining ROO Group, Mr. Regan was the Head of European Distribution for JumpTV. Mr. Regan is a digital media professional with over a decade of business development, strategic planning and client service experience. Prior to JumpTV, Mr. Regan was co-founder and CEO of Opus Media Plc, an online video platform specializing in South Asian content, which was sold privately in late 2006. Nigel starts in his role at ROO immediately, on a consultancy contract, based in ROO's London, UK office.

Ivan Dario Arias will be responsible for business development in Latin America for ROO Group. Mr. Arias was previously head of Latin American business development for JumpTV, where he was instrumental in building out that company's Latin American content portfolio. Mr. Arias previously served as Colombian Consul to the United States, and prior to that was the international campaign manager for Mr. Alvaro Uribe, President of the Republic of Colombia. Mr. Arias starts in his role at ROO immediately, based out of Bogota, Colombia.

"Our strategic goal for 2008 is to establish ROO Group as the leader in IPTV enablement in international markets," said Kaleil Isaza Tuzman. "ROO Group has spent several years and substantial capital in building and improving upon its VoD IPTV platform-which now includes a world-class proprietary video player, flexible monetization tools and user-generated solutions. In 2008, ROO will be a leaner and focused company, committed to more disciplined business practices, aggressive sales and content acquisition, and the execution of strategic and accretive acquisitions that advance our aim to be the leading device-agnostic IPTV enablement company."

Investor Conference Call
Management plans to hold an investor conference call later this quarter, in order to provide updates on today's announcements, and discuss additional initiatives related to its 2008 strategic realignment. For further inquiries, please contact Todd Fromer at KCSA Investor Relations at tfromer@kcsa.com.

About ROO
ROO Group Inc. (BULLETIN BOARD: RGRP) , through its 100% subsidiary ROO Media Corporation, is a global service provider enabling businesses to leverage their digital media assets and provide an enhanced user experience. The Company's proprietary platform and content management system, the ROO Video Exchange, and a suite of related products, allows web sites and their advertisers to organize video content, target advertising and maximize views. ROO is the service provider of choice for companies seeking enterprise level solutions and effective strategies for monetizing digital media assets. The Company also operates an advertising agency business specializing in a variety of media and services including direct marketing, brand planning and identity, media buying and packaging. ROO has offices in the United States, United Kingdom, and Australia. For additional information, please visit the Company's Web site at www.roo.com.

Source: ROO Group

CONTACT: Investors, Todd Fromer, +1-212-896-1215, tfromer@kcsa.com, or Public Relations, Lewis Goldberg, +1-212-896-1216, lgoldberg@kcsa.com, both of KCSA Strategic Communications for ROO Group

Web site: www.roo.com/

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