August 11, 2004

Circuit City moving to Linux

Author: Robin 'Roblimo' Miller

In a press release sent to NewsForge (and probably every other media outlet
in the world) yesterday, IBM announced that consumer electronics
retailer Circuit City expects to
be running most of its critical day-to-day computing functions on Linux by 2006. (Full text of
press release below.)This doesn't mean Circuit City is going to start selling Linux laptops or
desktops in its stores next week. In fact, says Circuit City media relations
person Jim Babb, it's the vendors -- not retailers -- who decide which
operating systems to ship on their products.

But there's always hope. Wal-Mart quietly started using Linux for its internal
operations a while back, and now it's selling Linux
distributions and Linux computers through
Wal-Mart.com.

Press release text:

Richmond, Va. and Armonk, N.Y., August 10, 2004 -- Circuit City Stores, Inc.
and IBM announced today that they are launching a technology transformation
of Circuit City's more than 600 stores, designed to update Circuit City's
point-of-sale (POS) systems and other in-store technology to where it is one
of the most advanced in the retail industry.

"This new technology initiative, a vital part of our store revitalization
effort, will move our store systems from customized, proprietary systems to
a system based on open standards," said Michael Jones, chief information
officer of Circuit City. "Our current POS systems, which contain a feature
set designed in the mid-1980s, are overly complex and restrict our business
expansion. The new systems will allow us to adopt leading practices and
improve store systems integration while optimizing store infrastructure
costs."

The transformation includes new IBM SurePOS 300 POS systems and secure
wireless handheld POS systems based on the IBM Store Integration Framework
and the open-source Linux operating system. Circuit City also will use IBM
Business Consulting Services to help plan the transformation.

"When a retailer can combine the latest technology with a superior business
vision and new processes, as Circuit City is doing, then they can increase
flexibility and efficiency, as well as transform their store operations and
the in-store shopping experience," said Steve Valentine, Retail Consulting
Executive of IBM. "The world's best retailers are leveraging this powerful
new technology and will be able to create new levels of business efficiency,
customer satisfaction and customer loyalty. Circuit City is on the leading
edge of this new trend."

The systems include POS software applications from 360Commerce and an
integration engine from Yantra. 360Commerce brings an industry-leading POS
application with a consistent and comprehensive solution that will easily
support Circuit City's complex selling environment. Its Java-based
application suite includes POS, Back Office, Central Office and Workforce
Management. Yantra offers a powerful process engine and application suite,
complementing Circuit City's core POS application. The Yantra applications
will be used to create enterprise services for order management and to
support Circuit City's Express Pickup order fulfillment, store inventory
control, product repair processing and product delivery and installation.
Both 360Commerce and Yantra are IBM Business Partners.

These in-store systems will be coupled with new data warehousing
capabilities, based on IBM eServer pSeries hardware and IBM DB2 database
software. The new data warehousing capabilities will improve internal
processes, streamline applications, and allow Circuit City to better view
and analyze data from all parts of the company, including POS and
Circuitcity.com, empowering the company to create a better customer
experience.

By employing the IBM Retail Environment for SUSE Linux at the point of sale,
Circuit City will have the flexibility and reliability of open standards,
enabling Circuit City to adapt quickly to changes in the retail marketplace
and to cost-effectively institute future upgrades to the platform. The IBM
Store Integration Framework allows for customized combinations of IBM
middleware solutions with specialized applications from IBM's network of
independent software vendors and industry-specific services to allow a
retailer to be more responsive to business opportunities and customer
demands.

The rollout to all stores is scheduled to start in March 2005 and is
expected to be completed by the end of February 2006. Circuit City expects
that the POS changes will not result in any material write-offs, nor will it
materially affect planned spending on store systems.

About Circuit City Stores, Inc.
Richmond, Va.-based Circuit City Stores, Inc. (NYSE: CC) is a leading
specialty retailer of consumer electronics. Circuit City operates 604
Superstores and five mall-based stores in 158 U.S. markets. Its subsidiary,
InterTAN, Inc., operates through more than 1,000 retail stores and dealer
outlets in Canada. Circuit City also operates a Web site at
http://www.circuitcity.com.

About IBM
IBM, the world's largest information technology company, is the leader in
providing the Retail Industry with a full range of e-business solutions,
including: point-of-sale systems, automated self-checkout systems, other
hardware and software technology, consulting focused on business
transformation, IT strategy and planning, store operations improvement, and
supply chain optimization, and with services, such as outsourcing, managed
operations, systems integration, and application development and design. IBM
has a list of retail customers in 100 countries worldwide that reads like a
"Who's Who" of retailing. For more information on IBM Retail Solutions,
please visit .

Circuit City Stores, Inc. - Forward-Looking Statements
This release may include forward-looking statements, which are subject to
risks and uncertainties, including without limitation (1) Circuit City's
ability to successfully integrate the new systems into its retail business;
and (2) increases in the costs associated with implementation or maintenance
of the new technology. Additional discussion of factors that could cause
actual results to differ materially from management's projections,
forecasts, estimates and expectations is set forth under Management's
Discussion and Analysis of Results of Operations and Financial Condition in
the Circuit City Stores, Inc. Annual Report for 2004, Quarterly Report on
Form 10-Q for the fiscal quarter ended May 31, 2004 and in the company's
other SEC filings. A copy of the annual report is available on the
company's Web site at www.circuitcity.com.

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