Digimarc Awarded Contract to Enhance U.S. Military Video Intelligence Systems

Digimarc Corporation (NASDAQ:DMRC) today announced that it was awarded a contract for the SmartData program by CACI International Incorporated, in the amount of $600,000, to further advance the technology used in U.S. military video intelligence systems. The initiative integrates hardware developed under a previous contract into an operational Unmanned Aerial Vehicle (UAV), and includes testing in specific scenarios to demonstrate improvements in collection, search, retrieval and dissemination of future intelligence, surveillance and reconnaissance imagery.

"This is the second of two federal contracts we were expecting this year. We are anxious to get to work on this continuation contract to take this important project to the next stage in its development," stated Bruce Davis, Chairman and CEO of Digimarc. "We have heard from soldiers who serve on the front lines that improvements in data collection and dissemination are necessary. It is gratifying to know that Digimarc technology has demonstrated value to government reconnaissance programs and will be further advanced through this initiative."

About Digimarc

Digimarc Corporation (NASDAQ:DMRC), based in Beaverton, Oregon, is a leading innovator and technology provider, enabling businesses and governments worldwide to enrich everyday living by giving persistent digital identities to all forms of media and many other objects. The Company’s technology enables a wide range of solutions for deterring fraud, counterfeiting and piracy, enhancing national security, and enabling new digital media distribution and monetization models that provide consumers with more choice and access to content when, where and how they want it. Digimarc has an extensive intellectual property portfolio, with more than 525 U.S. and foreign patents, and more than 400 patents pending in digital watermarking, media identification and management, and related technologies. Digimarc develops solutions, licenses its intellectual property, and provides development services to business partners across a range of industries. Please go to www.digimarc.com for more Company information.

Forward-Looking Statements

With the exception of historical information contained in this release, the matters described in this release contain various "forward-looking statements." These forward-looking statements include statements identified by terminology such as "may," "will," "should," "expects," "intends," "plans," "projects," "anticipates," "believes," "estimates," "predicts," "potential," "illustrate," "example" and "continue" or other derivations of these or other comparable terms. These forward-looking statements are statements of management's opinion and are subject to various assumptions, risks, uncertainties and changes in circumstances. Actual results may vary materially from those expressed or implied from the statements in this release as a result of changes in economic, business and/or regulatory factors. More detailed information about risk factors that may affect actual results is set forth in the Company's Form 10-K for the year ended December 31, 2008 in Part I, Item 1A thereof ("Risk Factors"), Part II, Item 7 thereof ("Management’s Discussion and Analysis of Financial Condition and Results of Operations”) under the captions "Liquidity and Capital Resources” and "Forward Looking Statements” and in Part II, Item 9A(T) thereof ("Controls and Procedures”), and in subsequent periodic reports filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date of this release. Except as required by law, Digimarc undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this release.