ATI Technologies and DivXNetworks form strategic relationship.

ATI Technologies Inc. (NASDAQ:ATYT) (TSX:ATY) and DivXNetworks, Inc. recently announced a strategic development and marketing agreement to combine ATI's innovative FULLSTREAM technology with widely popular DivX video compression technology for an enhanced digital video experience.

In the first collaboration between the two companies, ATI's new Visual Processing Units (VPU) will integrate DivX video compression technology and offer optimized playback of high-quality DivX video files. Thanks to hardware and software optimizations performed by ATI and DivXNetworks, RADEON 9500 & 9700-based products significantly increases video performance (up to 50% using post-processing) and reduce CPU usage when decoding DivX video. DivX video compression technology is a hugely popular video encoder / decoder thanks to the great reduction in encoded video file size with hardly any loss of picture quality. DivX technology has become a standard for high-quality IP video, with over 75 million downloads and an average of over 3 million downloads per month.

"DivXNetworks is a pioneer in enabling the delivery of DVD-quality digital video over the Internet, and we're excited to combine our cutting-edge video graphics card technology with their leading video compression technology," said Rick Bergman, Senior Vice President, Marketing and General Manager, Desktop, ATI Technologies Inc. "The synergy in harnessing the power of hardware and software will create higher visual quality, significantly faster playback time and a truly amazing digital video experience for consumers."

"As a recognized leader in the video graphics industry, ATI represents a valuable strategic development partner for DivXNetworks," said Jordan Greenhall, co-founder and CEO of DivXNetworks (www.divxnetworks.com). "By uniting the power of DivX with ATI's innovative advanced graphics technology, we can take the PC video experience to an entirely new level, significantly improving playback performance and visual quality."

"ATI is an excellent partner to help DivX video achieve cutting-edge performance with the leading series of graphics chip technology," said Tay Nguyen, vice president of operations at DivXNetworks. "Products based on ATI's RADEON 9500 & 9700 VPUs, with their extensible programming capabilities, are the video cards of choice for serious multimedia applications. Our joint development efforts will optimize DivX video to reach the unparalleled speed and visual performance that DivX power users demand."

RADEON 9500 & 9700 series VPUs feature fast 3D graphics performance, sophisticated real-time visual effects, unsurpassed image quality and cutting-edge video features. For more information, visit www.ati.com. The most recent DivX codec, called a "revolutionary product" by Tom's Hardware Guide, currently ranks as the most downloaded multimedia application on CNET's Download.com.