Consumer Electronics Association Recognizes SONICblue Products with Prestigious 2003 Innovation Awards.

Business Editors/High-Tech Writers

SANTA CLARA, Calif.--(BUSINESS WIRE)--Dec. 16, 2002

Rio S35S Portable Digital Audio Player and Go-Video Networked DVD 

Player D2730 Honored for Innovative Design and Engineering

SONICblue(TM) Incorporated (Nasdaq:SBLU) received 2003 Innovations Awards for Design and Engineering for its Rio(R) S35S portable digital audio player and the soon to be released Go-Video(R) Networked DVD player D2730. Sponsored by the Consumer Electronics Association (CEA), and presented in conjunction with 2003 International CES, the Innovations Awards program recognizes products that exhibit excellence in design and engineering.

"At SONICblue we strive to create products that allow users to enjoy, manage and collect digital audio and video entertainment in ways that are easier and more convenient than ever before," said Greg Ballard, CEO, SONICblue. "These two products exemplify that pursuit, which is why we believe they were selected for this honor. This type of recognition from the CE industry validates our vision for the future of connecting people to entertainment and we couldn't be more pleased."

A departure from the typical portable MP3 player, the organic design of the Rio S35S with its lively color scheme, small size, and ergonomic shape, is built for today's athlete and tech savvy youth. Made to withstand the rigors of extreme activity, the Rio S35S' lightweight design allows users to easily strap the player to their arm on the go and its sturdy construction and rubberized shell makes the player strong and durable. To create the product, SONICblue developed new electronic architecture called S-Tech that reduced the player size by more than 25 percent, while increasing the battery life and adding more features than previous generation products.

Enhancing the ease of use of the Rio S35S is Rio's new Music Manager software. This innovative and user friendly software delivers a simple and easy to navigate interface, making transferring MP3 and WMA files from a PC to a Rio digital music player quicker and easier than ever. The S35S features 128MB of built in memory giving users up to four hours of continuous music listening and is upgradeable to 256 MB. The S35S also contains a long list of features, including a large back lit screen, clock, stopwatch, and integrated FM tuner. As with all Rio digital music products, the firmware on the S35S is upgradeable, to insure continued usability.

The Go-Video Networked DVD Player D2730 will give users the ability to effortlessly watch or listen to the wide variety of entertainment content stored on a PC, including MP3 and WMA audio files, JPEG image files, and both MPEG1 and MPEG2 movie files. Installation is simple. For the estimated 4 million(a) US homes with an installed wireless network, users simply plug in the power cord and an optional PCMCIA 802.11b Wireless Network Card and the unit is recognized on the network. The device also offers an Ethernet connection for those estimated 9 million(a) US households with a standard wired network. With this player, which takes up about half the space of a traditional component piece, consumers will be able to enjoy their digital photos, home movies, Internet content and digital music all from the comfort of their living room.

Both CEA and SONICblue will showcase the Rio Sport S35S and Go-Video Networked DVD player D2730 at the International CES show in Las Vegas, January 8-12, 2003. Please contact a SONICblue representative to arrange a demonstration of the Rio Sport S35S or Networked DVD player at the show.

About SONICblue Incorporated (www.SONICblue.com)

SONICblue is a leader in the converging Internet, digital media, entertainment and consumer electronics markets. Working with partners that include some of the biggest brands in consumer electronics, SONICblue creates and markets products that let consumers enjoy all the benefits of a digital home and connected lifestyle. SONICblue holds a focused technology portfolio that includes Rio(R) digital audio players; ReplayTV(R) personal television technology and software solutions; and Go-Video(R) Dual-Deck(TM) VCRs and integrated DVD+VCRs.

(a) Source: IDC, 2001

Except for the historical information contained herein, the matters set forth in this press release, including, but not limited to, the upcoming release of the Go-Video D2730, the ability to upgrade the Rio S35S in the future so it will remain continually usable, the forthcoming release of the Go-Video D2730 and the features and functionality in the D2730, including the ability to watch or listen to entertainment content stored on a PC, and the showcasing of the Rio S35S and the Go-Video D2730 at the International CES show, are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including, but not limited to, the impact of competitive products and pricing and of alternative technological advances, the ability of SONICblue and its suppliers and partners to meet scheduled delivery and release dates, product engineering and marketing decisions of SONICblue and others, limitations on SONICblue's ability to support new platforms and technology, decisions made by the International CES program organizers, and other risks detailed from time to time in the SEC reports of SONICblue Incorporated, including its annual report on Form 10-K for the period ended December 31, 2001 and its quarterly report on Form 10-Q for the period ended September 30, 2002. These forward-looking statements speak only as of the date hereof. SONICblue disclaims any obligation to update these forward-looking statements.

Note to Editors: Rio, Go-Video and ReplayTV are registered trademarks of SONICblue Incorporated. SONICblue and Dual-Deck are trademarks of SONICblue Incorporated.