Sand Video to Demonstrate Industry's First-Ever Silicon AVC/H.264 High Definition Real-Time Decoder Chip at the 2004 Consumer Electronics Show.

Business Editors/High-Tech Writers

2004 International CES

LAS VEGAS--(BUSINESS WIRE)--Jan. 6, 2004

A Breakthrough in Silicon Compression Technology, the SV-D011 Will

Bring High Definition Advanced Video Compression to Consumer Devices

Sand Video, Inc., a recognized expert in Advanced Video Coding/H.264 semiconductor video compression technology, will demonstrate the SV-D011, the industry's first silicon-based AVC/H.264 high definition real-time decoder, at the 2004 Consumer Electronics Show (CES) in Las Vegas.

The SV-D011 chip represents a significant breakthrough in video compression because for the first time it is technically and economically feasible to incorporate high definition AVC/H.264 compression technology in a broad range of consumer video devices including cable and satellite TV set-top-boxes, DVD players and recorders, personal video recorders (PVRs), digital cameras and camcorders and cell phones. The SV-D011 implements the AVC/H.264 standard's Main Profile with support for all broadcast formats up to and including 720p and 1080i. Systems incorporating the SV-D011 will have superior image quality, storage capacity and system performance as compared with systems based on the existing MPEG-2 standard.

Sand Video has already shipped samples of the chip to its customers who are integrating the chip into consumer electronic devices that are expected to be announced in the second half of 2004.

"Our customers asked us to accelerate delivery of the SV-D011 because there is significant interest in deploying this technology in DVD and Set-top box applications. We have responded by delivering it ahead of schedule," said Don Shulsinger, Executive Vice President of Marketing and Sales at Sand Video. "OEMs realize that the competitive advantage they can achieve by incorporating advanced video compression technology can substantially enhance their position in the marketplace and Sand Video is the only company that can deliver the technology. The SV-D011 shows Sand Video's continued leadership in the silicon video compression sector."

Sand Video will also demonstrate its SV-IP01LP low power decoder core for mobile applications. Announced in December 2003, the SV-IP01LP is the first AVC/H.264 low power core designed specifically for applications such as mobile TV and streaming video reception on cell phones.

Sand Video's Business Growth

In response to increased customer activity, Sand Video has seen its business grow significantly over the past year. Initiatives such as the SV-IP01LP for mobile TV have enabled Sand Video to enter new markets and to triple the size of its organization.

"We're finding traction with customers in all the product categories we've approached," said Mr. Shulsinger. "AVC/H.264 video compression is a very sophisticated and complex technology and our ability to deliver working silicon has impressed our customer base. We are achieving our business objectives faster than expected. And with the upcoming availability of the first silicon-based full codec chip in early 2004 we feel the company is poised for significant continued growth."

Sand Video's Compression Advantage(TM) Architecture

Sand Video's Compression Advantage(TM) architecture enables the industry's first and only multi-standard advanced video compression chip products that support video formats ranging from QCIF (176x120) up to and including full high definition (720p & 1080i). With support today for AVC/H.264 and MPEG-2, Sand Video is setting the standard for silicon based video compression solutions. Sand Video's family of products include the SV-D011 chip, the first and only chip available that supports real time high definition AVC/H.264 video decompression, and the SV-IP01 high definition decoder core and the SV-IP01LP low power decoder core which are designed to allow OEMs to incorporate Sand Video's advanced video decompression technology into their own highly integrated SOC products. Additionally, Sand Video is on schedule to deliver samples of its silicon based full codec chip, the SV-C011, in early 2004.

About Sand Video, Inc.: Sand Video is a fabless semiconductor manufacturer focused on developing and marketing superior next generation, standards-based semiconductor video compression technology for a broad range of video applications. Sand Video is a privately held, venture-backed company based in Andover, Mass. For more information on Sand Video, visit www.sandvideo.com.

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