QSound Labs Signs Licensing Agreement with Broadcom; microQ Technology to Deliver Next-Generation Audio Capabilities to Handset Manufacturers.

Business Editors/High-Tech Writers

CALGARY, Alberta--(BUSINESS WIRE)--June 2, 2004

Continued Adoption of the microQ Product Suite Underscores Its

Position as the Definitive Audio Solution of Choice among Mobile and

Broadband Communications Leaders

QSound Labs, Inc. (NASDAQ:QSND), a leading developer of audio, voice and e-commerce software solutions, today announced its licensing agreement with Broadcom Corporation (NASDAQ: BRCM), a leading provider of highly integrated semiconductor solutions enabling broadband communications. Under the terms of the agreement, QSound is providing its microQ synthesizer components for use in Broadcom's base band processors for mobile phones and PDAs, which includes rights to integrate the technology across multiple platforms and chips.

QSound Labs' microQ solution for Broadcom supports all of today's most popular content formats, namely, MIDI, SP-MIDI, Mobile DLS and SMAF. With the integration of this technology into its mobile phone processors, Broadcom will further reduce costs and space requirements for handset manufacturing customers by eliminating their need to include an expensive external ring tone chip.

Introduced in 2003, microQ tchnology is currently shipping in MiTAC's DigiWalker(TM) line of next generation smartphones and pocket PCs, including the recently launched Mio 8390(TM). MicroQ has been optimized for Intel's(R) Wireless MMX(TM) technology for mobile devices based on the newly launched Intel(R) PXA27x processor family. Additionally, microQ has been ported to several semiconductor platforms, including LSI Logic's ZSP Processor family.

"Broadcom's confidence in the microQ product suite is further indication of its adoption as the definitive solution of choice among industry leaders," stated David Gallagher, President and CEO of QSound Labs. "QSound Labs is committed to leading the mobile and broadband communication market in next-generation audio capabilities."

About microQ

microQ is a compact, hardware-independent and highly efficient software audio engine providing functions such as polyphonic ringtones, video game sounds, music playback, digital effects and recording for portable applications, including Internet appliances, hand-held and mobile devices. A low-cost and flexible option for consumer electronics and mobile device manufacturers, MicroQ is inherently modular, scalable and portable. Its core components include a digital audio playback engine, a wavetable synthesis engine with a scalable sample set, and a multi-channel stereo mixer. Additionally, microQ offers a wide range of processes to control frequency response, dynamics and spatial enhancements, as well as full 3D positional audio.

About QSound Labs, Inc.

Since its inception in 1988, QSound Labs, Inc. has established itself as one of the world's leading audio technology companies. The company has developed proprietary audio solutions that include virtual surround sound, positional audio and stereo enhancement for the consumer electronics, PC/multimedia, Internet and healthcare markets. QSound Labs' cutting-edge audio technologies create rich 3D audio environments allowing consumers to enjoy stereo surround sound from two, four or 5.1 speaker systems. The company's customer and partner roster includes Toshiba, Philips, Sharp and RealNetworks, among others. To hear 3D audio demos and learn more about QSound, visit our web site at http://www.qsound.com.

This release contains forward-looking statements within the meaning of the Private Securities Litigation Act of 1995 concerning, among other things, use of microQ in Broadcom processors. Investors are cautioned that such forward-looking statements involve risk and uncertainties, which could cause actual results, performance or achievements of QSound, or industry results to differ materially from those reflected in the forward-looking statements. Such risks and uncertainties include, but are not limited to, risks associated with acceptance of microQ technology by manufacturers and consumers, additional licensing arrangements, continued growth of the mobile electronics market, dependence on intellectual property, rapid technological change, competition, general economic and business conditions, and other risks detailed from time to time in QSound's periodic reports filed with the Securities and Exchange Commission. Forward-looking statements are based on the current expectations, projections and opinions of QSound's management, and QSound undertakes no obligation to publicly release the results of any revisions to such forward-looking statements which may be made, for example to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.