ATI Delivers First 3D Gaming Chip for Cellphones.

Business Editors/High-Tech Writers

MARKHAM, Ontario--(BUSINESS WIRE)--Jan. 7, 2004

New Imageon(TM) 2300 Enables Amazing 3D Performance on

Mobile Phones with Little Impact on Power Consumption

Playing truly 3D enabled games on cellphones is now possible thanks to the new IMAGEON(TM) 2300 multimedia and graphics family of co-processors from ATI Technologies Inc. (NASDAQ:ATYT)(TSX:ATY). Introduced today, these new co-processors enable game developers to go beyond simplistic game design approaches and give users complete freedom of movement, and visually rich 3D gaming experiences.

With IMAGEON 2300, ATI has taken its years of 3D gaming expertise - whether it is for the PC, notebook or console - and applied its world leading technology to the cell phone marketplace. The "tour-de-force" was to integrate a full fledged, no compromise hardware 3D engine in a cost effective and power efficient multimedia companion chip for the new generations of feature phones.

"ATI is revolutionizing the market once more by raising the bar and delivering yet another appealing feature to mobile phones and handheld devices: Hardware accelerated 3D gaming," said Azzedine Boubguira, Director of Marketing, Handheld Products Group, ATI Technologies Inc. "As an industry-first, IMAGEON 2300 enables exceptional 3D gaming that will fully leverage and help monetize the higher bandwidth offered by 2.5G and 3G networks."

IDC data indicates that wireless gaming is on the rise and will generate USD $1 billion in wireless gaming revenue by 2006 for wireless carriers in the United States.(1)

"Consumers will be able to enjoy a real mobile console experience on their cell phone with the new ATI chipset," said Adam Comiskey, General Manager EMEA, THQ Wireless (NASDAQ: THQI). "We were impressed with the capabilities of the IMAGEON 2300. The hardware 3D engine allowed us to use the original 2003 PC MotoGPII code, combining a high level of performance and graphics that has not been seen with a software only version. With mobile gaming moving at such a rapid pace, and THQ Wireless at the frontier of groundbreaking products, we are delighted to be working with ATI on this project."

ATI continues its groundbreaking success in the wireless marketplace by delivering industry leading functionality designed to enhance OEM (original equipment manufacturer) products. IMAGEON 2300 includes the following:

-- Advanced 2D and 3D graphics;

-- MPEG 4 decode with real-time video playback at 30-fps and low

power consumption;

-- Video Capture Ports with support for high resolution camera

sensors (1.3M and 2M pixels);

-- JPEG CODEC to compress and decompress images to be either

saved in memory and printed or shared wirelessly by the camera

phone user; and,

-- Many other features such as two display engines (primary and

sub-display) and embedded frame buffer.

ATI has always been a strong believer, promoter and adopter of industry standards. IMAGEON is no exception, and offers support for the OpenGL ES rendering API - a royalty free 3D API consisting of well-defined subset profiles of OpenGL, with custom ATI extensions to further improve rendering performance. The goal is to help content developers easily create advanced 3D games and applications on a wide variety of wireless platforms.

"Enabling developers to tap into the incredible performance and realism of the new ATI IMAGEON 2300, Mascot Capsule has optimized its latest generation Micro3D V4 engine for the IMAGEON processor," said Carl Korobkin, President and COO of Mascot Capsule America, a division of HI Corporation. "Providing IMAGEON developers with fully-compliant, world-leading implementations of JSR184 and OpenGL ES, the latest release of our Micro3D graphics engine, builds upon a platform currently incorporated in more than 30 million handsets and powers an impressive catalog of console-quality games."

Availability

ATI's IMAGEON 2300 media co-processor is currently sampling. Mass production shipments will start in Q1 2004.

ATI Technologies will exhibit its handheld products at International CES 2004, booth 23045, South Hall, Upper Level, Las Vegas Convention Center.

About ATI Technologies

ATI Technologies Inc. is the world leader in the design and manufacture of innovative 3D graphics and digital media silicon solutions. An industry pioneer since 1985, ATI is the world's foremost visual processor unit (VPU) provider. ATI is dedicated to delivering leading-edge performance solutions for the full range of PC and Mac desktop and notebook platforms, workstations, set-top and digital televisions, game consoles and handheld device markets. With 2003 revenues in excess of US $1.3 billion, ATI has more than 2,200 employees in the Americas, Europe and Asia. ATI common shares trade on NASDAQ (ATYT) and the Toronto Stock Exchange (ATY).

Copyright 2004 ATI Technologies Inc. All rights reserved. ATI and ATI product and product feature names are trademarks and/or registered trademarks of ATI Technologies Inc. All other company and product names are trademarks and/or registered trademarks of their respective owners. Features, pricing, availability and specifications are subject to change without notice.

For media or industry analyst support, visit our Web site at http://www.ati.com

(1) IDC, U.S. Wireless Gaming Forecast Update, 2003-2008: Mobile Users Just Wanna Have Fun