Cornice Enables New Generation of Low-Cost High-Durability Consumer Electronics Devices; Low-Cost Storage Element Based on Crash Guard Technology.

LAS VEGAS -- Cornice Inc. -- an innovator in compact, cost-effective, high-capacity storage solutions for pocket-able consumer electronics -- today announced the first 3.0-gigabyte storage solution that will allow consumer electronics manufacturers to offer significantly lower consumer price points for devices like MP3 players, cell phones, personal video recorders and GPS devices. The new Cornice 3.0-gigabyte Storage Element will appear in early 2005 in several new MP3 products that are being launched this week at the Consumer Electronics Show (CES).

Storage is the single most expensive component in most consumer electronics devices. Because Cornice built its Storage Elements from the ground-up to be optimized for consumer electronics, the company offers the most competitive price point for high-capacity storage available anywhere. The company's new 3.0-gigabyte offering allows OEMs to deliver new products into new and existing categories at extremely competitive high-volume retail price points.

Crash Guard for the Active Lifestyle

Based on Cornice's Crash Guard technology, the new 3.0-gigabyte Storage Element addresses the ruggedness and durability issues that plague many of the most popular MP3 players and cell phones on the market today. Consumer products built with Cornice can sustain much wider ranges of movement and shock than competitive products, aligning them perfectly with the active lifestyle of today's consumer. The 3.0-gigabyte Storage Element includes a new Active Latch mechanism to prevent the kind of damaging drive head movement that can occur when a device is dropped.

"In 2005 we're going to see new, low-cost storage enable big brands to bring products like full-feature MP3 players to market in the $179 and below price range," said Kevin Magenis, Cornice co-founder and chairman. "We are now seeing cell phones based on rotating media pave the way for a host of new wireless data applications and a continuing convergence of things like music and video into single, multi-use devices."

The Cornice 3.0-gigabyte Storage Element is the highest capacity single-head one-inch storage solution available today. It supports the storage demands of people using most low-cost "pocket-able" digital entertainment devices, including:

--Songs - 1,800 titles in WMA at 64Kbits/second or 900 songs at 128Kbits/second

--Movies - Nine full-length films or 13 hours of video playback on a 3.5-inch screen, or 12 full-length movies or 20 hours of video playback on 1.5-inch screen

--Video recording - 5.25 hours of recorded material at VHS-quality for television monitor playback

--Photos - 42,000 pictures on a 3.5-inch display or 3,750 pictures from a three mega-pixel camera

Since its initial launch in 2003, Cornice enabled its customers to achieve first-to-market status and volume production with rotating media-based products in four market categories -- digital audio, personal storage (USB devices), GPS and mobile phones. By the middle of 2004, Cornice had already shipped more than 1 million Storage Elements to leading CE manufacturers such as Garmin, Philips and Samsung.

Pricing and Availability

The 3.0-gigabyte Storage Element with Crash Guard technology is available now and is $65 per unit in quantities of 50,000.

Meet Cornice at CES

Cornice will be showing pocket-able consumer electronic devices that use the unique Storage Element at the International Consumer Electronics Show. The show takes place January 6 - 9, 2005, at the Las Vegas Convention Center. Cornice will be located in the CES Meeting Place in the South Hall #35579.

About Cornice

Cornice Inc. is an innovator in small, compact, low-cost, high-capacity storage that enables a new generation of pocket-able consumer electronic devices for the world's leading brand-name manufacturers. The Cornice Storage Element (SE) is durable, integrated, personal storage that brings new levels of affordability and content capacity to these devices.

Early investors in Cornice include the company's founders, management team and Texas Instruments. The Company has received venture investments from BA Venture Partners, CIBC Capital Partners, GIC Special Investments, Nokia Venture Partners and VantagePoint Venture Partners. Privately held, Cornice maintains its headquarters in Longmont, Colorado. Visit Cornice at http://www.corniceco.com/.