Corel and OE/ONE.com Team to Deliver 'Lean' Linux Appliance Platform: Investment in former Corel executive's start-up expands Corel LINUX OS reach.

Business Editors

OTTAWA--(BUSINESS WIRE)--Jan. 18, 2000

COREL(NASDAQ:CORL) (TSE:COR.) Corel Corporation (NASDAQ: CORL, TSE: COR) today announced it has entered into an agreement to acquire up to a 30 per cent stake in OE/ONE.com, a start-up company developing an "Information Appliance" platform or thin-client Internet Appliance platform.

Founded by former Corel executive Eid Eid this past year, OE/ONE.com has developed a software tool kit, specifications and an industrial design for the product, and is currently working with OEMs - including Tier One consumer electronics manufacturers - to develop the appliance, expected to hit the market in the sub-US $500 range.

Corel will assist OE/ONE.com in implementing many Corel(r) LINUX(r) features with the OE/ONE.com software. By leveraging what Corel has done with the File Manager, Browser, Control Center and GUI (graphical user interface), OE/ONE.com can bring ease-of-use at the screen and display level to the Information Appliance while running on Linux's stability and performance. At the same time, Corel will develop a scaled-down version of the Corel LINUX OS optimized for specific devices and applications.

"The Internet or Information Appliance market is one of the hottest developing markets in computing, and we think OE/ONE.com is among the leaders in the race to bring a whole new range of computing technology to market based on Linux," said Michael Cowpland, president and chief executive officer of Corel Corporation. "Our investment in OE/ONE.com brings yet another element to Corel's comprehensive Linux affiliate portfolio, while enhancing our position as a major Linux player."

OE/ONE.com is Corel's fifth Linux affiliate developed through strategic investments. Other affiliates GraphOn, Rebel.com, LinuxForce Inc. and Newlix Corporation give Corel LINUX penetration from the desktop to the server, with proprietary and Open Source hardware as well as professional and technical service support.

A report from International Data Corporation projects that worldwide Information Appliance shipments will grow to over 55 million units in 2002, at a 76 per cent compounded annual growth rate and values the market at more than US $15.3 billion in 2002.

Another report by Strategic Analytics, pegs the value of the appliance market segment aimed at the residential market in the United States excluding devices such as Web-enhanced cellular phones and digital assistants at US. $5.6-billion by 2005, with the average U.S. household having 2.7 online devices.

"Many months before analyst firms began reporting the potential growth of Information Appliances in the market, we believed that people accessing the Internet via these appliances and other alternative devices would far outnumber those accessing the Internet via traditional computers," said Eid Eid, president and chief executive officer of OE/ONE.com. "I am very thrilled about our strategic relationship with Corel, which is an endorsement from the recognized leader in Linux distribution for the desktop."

"In particular, I am pleased to partner with Michael Cowpland, with whom I share the same vision for the future of Linux," added Mr. Eid. "Our partnering will extend beyond the investment, to bring a wealth of Corel technology, including WordPerfect 8 for Linux, closer to the consumer."

"GraphOn is pleased to see Corel expand its presence in the Linux arena by investing in new companies and technologies that support the growth of the Linux operating system into new markets," said Walt Keller, president and chief executive officer of GraphOn Corporation. "Using GraphOn's Bridges software, Corel eases the migration from Windows and establishes Linux OS on the desktop. With an alliance such as the one with OE/ONE, Corel brings Linux into the consumer entertainment market as well as the emerging Information Appliance market."

The Information Appliance is intended as a high-end machine which can record movies and music and give playback on-demand capability. Based on OE/ONE.com software and X86 architecture, the Information Appliance will offer the high-end functionality of an iMAC(tm) or a Windows(r) 98 machine with the simplicity of an Internet/Information Appliance.

The concept of developing Information Appliances has recently been validated by major players such as Dell and Intel. Intel recently announced it will further expand its horizons through plans for selling Linux-powered Internet Appliances that make phone calls, surf the Web and send and receive e-mail. Corel Corporation

Corel Corporation is an internationally recognized developer of award-winning business productivity, graphics and operating system solutions on the Windows(r), Linux(r), UNIX(r), Macintosh(r) and Java(tm) platforms. Corel also develops market-leading, Web-based solutions including applications, contents, e-commerce and online services. For access to these services and more information go to www.corel.com or www.corelcity.com. Corel is headquartered in Ottawa, Canada. Corel's common stock trades on the NASDAQ Stock Market(sm) under the symbol CORL and on the Toronto Stock Exchange under the symbol COR.

OE/ONE.com Corporation

Based in Hull (Ottawa), OE/ONE.com is a software developer for the Consumer Electronics industry. Founded in June 1999, the company is led by President and CEO Eid Eid and consists of an experienced team of Internet and Linux developers with a background in developing leading commercial grade software.

Leveraging the power of the Linux operating system, Netscape Communicator (Mozilla) and a wealth of other open source technologies, OE/ONE.com is building a simple, versatile and robust operating environment that will enable major Consumer Electronics OEMs and Service Providers to offer new class of Information Appliances. These affordable and easy to use appliances will provide increased access to rich Internet content, including integrated IP communication and audio-video entertainment. For more information, please visit our Web site at www.oeone.com.

This press release contains statements that are forward looking as that term is defined by the United States Private Securities Litigation Reform Act of 1995. These statements are based on current expectations that are subject to risks and uncertainties. Actual results will differ due to factors such as shifts in customer demand, product shipment schedules, product mix, competitive products and pricing, technological shifts and other variables. Readers are referred to Corel's most recent reports filed with the Securities and Exchange Commission.

Corel and the Go Further logo are trademarks or registered trademarks of Corel Corporation or Corel Corporation Limited. Linux is a registered trademark of Linus Torvalds. UNIX is a registered trademark of The Open Group. All other product names are trademarks of their respective companies. All other brands and products referenced herein are the trademarks or registered trademarks of their respective holders.