Infineon Technologies Celebrates Opening of Austrian Development Center For UMTS Third-generation Mobile Radio Applications.

Business Editors and High Tech Writers

MUNICH/LINZ--(BUSINESS WIRE)--May 15, 2000

Infineon Technologies AG (FSE/NYSE: IFX) strengthens its activities in the rapidly growing mobile radio market today by opening a new development center in Linz, Austria. The new development center, Danube Integrated Circuit Engineering GmbH & Co. KG (DICE), will develop third-generation mobile radio chips using the Universal Mobile Telecommunications System (UMTS) standard. Infineon has a 50.3 per cent stake in the development center, with the other shares held by the technical managers of DICE Dr. Weigel, and Dr. Hagelauer, both from the University of Linz.

"The new development center underlines our commitment to research and development of the mobile communications market with the objective of offering complete solutions for third-generation mobile radio applications," said Gunter Weinberger, head of the Wireless Products Division of Infineon. "We have been working closely with the University of Linz since 1998 and this collaboration has enabled us to develop the first prototype chips using the UMTS standard for the next generation of mobile phones."

Collaborative efforts have been very successful. One year after joint development began, the first prototype chip - a complete superheterodyne receiver of more than 4,000 components with a chip area of just 2.44 mm by 3.01 mm was manufactured in Munich. In April 2000, the first chip for the Japanese UMTS market was produced, featuring a fully integrated UMTS superheterodyne transceiver.

Currently, 30 development and test engineers are employed at DICE, with the number expected to rise to 70 in the next few years. Dr. Weigel and Dr. Hagelauer are responsible for technical management of the development center while Edwin Moser of Infineon Technologies is the financial manager.

As part of Infineon's worldwide development network strategy, the new development center will play a key role in supporting the existing centers and ensuring a constant exchange of knowledge. Infineon Technologies has other development centers in Bangalore (India), Bristol (United Kingdom), Burlington/East Fishkill, Durham, Longmont, Princeton, Santa Cruz and San Jose (all in the USA), Singapore, Sophia Antipolis (France), Tel Aviv (Israel), Graz and Villach (Austria), and Duisburg, Dusseldorf, Ulm and Munich (Germany).

UMTS third-generation mobile radio standard

Although GSM has been the standard for past seven years, the demand for multimedia features and the skyrocketing increase in Internet traffic has created a significant bottleneck in GSM bands. UMTS is at the forefront as the new standard for the third generation of mobile phones to facilitate rapid data transfer for Internet services, multimedia and new service concepts.

In addition to a strong surge for mobile data communications, UMTS will also be able to integrate telecommunications, information technology and multimedia for fixed and mobile phone networks with different standards under the watchword of "Fixed/Mobile Convergence". Apart from the convenience of a single telephone number and bill, users will be able to access their personal services anywhere and at anytime, without regard to type of network or access technology.

UMTS is expected to be launched on the Japanese market in April 2001, with Europe following some time in 2002.

About Infineon

Infineon Technologies AG, Munich, Germany, offers semiconductor solutions for applications in the wireless and wired communications markets, for the automotive and industrial sectors, for security systems and chip cards as well as memory products. With a global presence, Infineon operates in the US from San Jose, CA, and in the Asia-Pacific region from Singapore. In the fiscal year 1999 (ending September), the company achieved sales of Euro 4.24 billion (US $ 4.51 billion) with about 26,000 employees worldwide. The company is listed on the main market segment (Amtlicher Handel) of the Frankfurt Stock Exchange and at the New York Stock Exchange. Further information at www.infineon.com

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Any statements in this document that are not historical facts are forward-looking statements that involve risks and uncertainties; actual results may differ from the forward-looking statements. Infineon Technologies undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.