PortalPlayer Integrates M-Systems' DOC H-series Embedded Flash Drive into its Latest Personal Media Player Development Platform; Solution Quickens Time-to-Market for Device Manufacturers Utilizing the Latest NAND Flash Technology.

LAS VEGAS -- M-Systems (Nasdaq: FLSH), an industry leader and innovator of flash-based data storage devices, and PortalPlayer, Inc (Nasdaq: PLAY), a leading supplier of advanced semiconductor, firmware and software solutions for the personal media player market, today announced integration of M-Systems' DOC H-series embedded flash drive (EFD) into PortalPlayer's personal media player development platform.

M-Systems' DOC H-series offers device manufacturers an easy-to-integrate means of utilizing the latest cost-effective high-density MLC NAND flash media in short time-to-market schedules. Providing enhanced reliability and high performance, delivered through patented flash management technologies such as M-Systems' TrueFFS(R), DOC H-series is well suited to meet the growing demand for high density storage in personal media players.

PortalPlayer's personal media player development platforms have been used in some of the most innovative hard drive and flash based music jukeboxes on the market today. PortalPlayer's comprehensive platform solutions include system-on-chip, firmware, software and third-party integration tools, and now - for the first time, support for M-Systems' high-density DOC H-series EFDs.

"The integration of DOC H-series support within our development platform will provide our customers with the latest flash technology available," said Todd Moore, vice president of marketing, personal media player division, at PortalPlayer. "By using new MLC NAND flash technology, as the underlying media behind the DOC H-series' standardized interface, we offer our customers a fast time-to-market, high performance flash solution."

"We are proud to be partnering with PortalPlayer, a leader in personal media player technology," said Noam Kedem, vice president marketing for M-Systems. "M-Systems' DOC H-series products, now integrated and ready to be used within PortalPlayer's development platform, allow ODMs to tap into the latest flash technologies, in a short design cycle, while relying on the proven track record of DiskOnChip EFD architecture already successfully deployed in millions of mobile handsets worldwide."

PortalPlayer's development platform with support for M-Systems' DOC H-series EFDs will be demonstrated during the 2006 International Consumer Electronics Show (CES) in Las Vegas, 5-8 January, 2006.

About PortalPlayer

PortalPlayer develops semiconductor, firmware and software platforms for personal multimedia products such as personal media players and secondary display enabled notebook computers. PortalPlayers products empower consumers to quickly and easily manage, enjoy and have access to multimedia content and other forms of information. PortalPlayer is headquartered in San Jose, Calif., with offices in Kirkland, Wash., Taipei, Taiwan and Hyderabad, India. More information about PortalPlayer is available online at www.portalplayer.com.

About M-Systems

M-Systems develops, manufactures and markets innovative flash-based data storage solutions for consumer electronics and embedded markets. The Company targets the fast growing multimedia mobile handset market with its DiskOnChip(R) and MegaSIM(TM) products and the popular USB flash drive market with its DiskOnKey(R) product. More information about M-Systems is available online at www.m-systems.com.

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This press release includes forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements, as they are subject to various risks and uncertainties which may cause actual results to vary significantly. These risks include, but are not limited to: the effect of global economic conditions in general and conditions in M-Systems' industry and target markets in particular, shifts in supply and demand, market acceptance, the impact of competitive products and pricing, product development, commercialization and technological difficulties, and capacity and supply constraints including dependence on flash component suppliers; changes in M-Systems' and its customers' inventory levels and inventory valuations; timely product and technology development/upgrades and the ability to manage changes in market conditions as needed; market acceptance of new products and continuing product demand; the impact of competitive products and pricing on M-Systems' and its customers' products and markets; the development, release and sale of new products by strategic suppliers and customers; the development and growth of anticipated markets for M-Systems' and its customers' products; and other risk factors detailed from time to time in M-Systems' filings with the Securities and Exchange Commission. M-Systems assumes no obligation to update the information in this press release and disclaims any obligation to publicly update or revise any such forward-looking statements to reflect any change in its expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements. Reference to M-Systems' website above does not constitute incorporation of any of the information thereon into this press release.