"This is the biggest exclusive Internet agreement in the history of adult entertainment, and it is just the first step in our negotiations with different language portals throughout the world," says CEO, Berth Milton

(BARCELONA, Spain) -- Private Media Group Inc. (Nasdaq: PRVT - news), a leader in adult entertainment products and services since 1965 and the first such premium quality company trading on the Nasdaq National Market, today announced that it has signed an exclusive joint venture agreement with Proel S.A., a Spanish-based Internet Service Provider that specializes in the design, maintenance and management of electronic publications served online through the Internet. The exclusive agreement allows that two new Internet domain addresses, www. privatehispano.com and www. privateportugues.com, in the Spanish and Portuguese languages respectively, will be accessed from Proel's impending Internet portal to the Spanish and Portuguese speaking world in Europe, Latin America and the USA. Star Media, AOL and Terra currently operate similar portals. Private Media Group secured the exclusive adult link on the Proel portal as the Company could guarantee complete, fully-interactive Web services with legal and worldwide copyright.

There are an estimated 500 million Spanish and Portuguese speakers in the world today but, at present, just 2% of the world's Internet sites use Spanish or Portuguese. The two new Private websites will be translated versions of the Company's flagship www.private.com subscription-only Member Areas.

Jupiter Communications predicts that by year 2003 there will be 38 million users in Latin America which, together with Merrill Lynch projections of 8.4 million Internet users in Spain, means that the Private Media Group websites on the new portal will be available to in excess of an estimated 46.4 million people.

In addition, International Data Corporation predicts that e-commerce sales throughout Latin America are expected to generate $8 billion by 2003. Historically, adult entertainment sales account for at least 50% of online revenues. The agreement includes a core provision for profit-sharing between Private and Proel from virtual sales, firm sales and advertising.

"This is the single most significant event in this company's history," said Berth Milton, CEO of Private Media Group. "Since we implemented our Internet division in 1997, we have been aiming for the world's different language markets, and this is just the first step in our current negotiations with a number of language portals. As this is the biggest exclusive Internet agreement in the history of adult entertainment, Private has shown its leadership once again. The whole map of the industry is changing rapidly with technological advances like DVD, the Internet and e-commerce. These channels and formats have more protection for minors built-into the technology, something that wasn't available previously. More and more countries are seeing adult entertainment as just one element of adult lifestyle and it is losing its 'underground' image. As we approach the millennium, our industry is at an exciting stage of transition and Private Media Group is perfectly positioned for the opportunities ahead."

Private Media Group Inc. commenced operations in 1965. Its primary business activities today include the creation, refinement and delivery of proprietary Internet sites and the licensing of its library content and brand name for Internet sites and broadcasting transmission; the acquisition, refinement and delivery of adult feature products, including unrated and adult feature DVDs, magazines, videos, and CD-ROMs; the distribution and licensing of Private's total proprietary product range on the Internet, including DVDs, magazines, videos, interactive services and the Private Circle fashion line; the licensing of its internationally reputable brand name for product lines, including adult novelty product ranges such as Private Collection; the production and control of distribution rights to its Private Dynamite energy drink; and TV Home Shopping for Private's proprietary and licensed products.

For more information visit the Company's corporate website at www.prvt.com.

This release contains, in addition to historical information, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect the Company's current judgments of those issues. However, because those statements are forward-looking and apply to future events, they are subject to such risks and uncertainties, which could lead to results materially different than anticipated by the Company.

SOURCE: Private Media Group Inc.

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