Sigma Begins Sampling The Industry's First Media Processor With Dual High-Definition Decoding of H.264, VC-1 and MPEG-2.

MILPITAS, Calif. -- New 64-bit SMP8634 Provides Substantially Increased Performance and Peripheral Support To Meet Market Requirements For High-Definition IPTV and DVD Products

Sigma Designs (Nasdaq:SIGM), a leader in digital media processing for consumer appliances, today announced that it has begun sampling its new SMP8634 media processor, designed for the latest Internet Protocol Television (IPTV) set-top boxes and high-definition DVD players. The SMP8634 represents a substantial milestone for the media processor industry, providing the first system-on-chip processor that not only decodes H.264 (AVC), VC-1 and MPEG-2, but also supports multi-stream decoding of any format, up to the equivalent of two simultaneous high-definition streams, along with full-screen graphics.

"Sigma has worked closely with some of the largest network operators, set-top box manufacturers, and consumer electronics companies to develop a media processor that meets the needs of next generation IPTV services and high-definition DVD players," said Ken Lowe, VP of strategic marketing. "We are proud to be the first company to introduce a chip that matches these new decoding needs, demonstrating our entrenched, technological leadership. In the coming months, our top-tier customer announcements will demonstrate the SMP8634's market acceptance."

Next Generation Consumer Products Demand High Performance

The increasing pervasiveness of digital media, coupled with a fundamental need for entertainment alternatives are paving the way for explosive growth in new types of consumer products and services. Telcos around the world are preparing to launch premium video services, DVD is moving to high definition, and consumers are employing wireless networks to pass this new media anywhere within the home. The common denominators in turning these concepts into commercial realities are advanced compression technologies, and high performance media processors.

Driving this movement is a transition from the digital media monopoly, held by MPEG-2 for the past 10 years, yielding to a duopoly shared by two new video codecs that provide more than twice the compression efficiency: VC-1, a SMPTE specification based on Microsoft's Windows Media Video 9 (WMV9), and H.264, a shared specification from ITU and MPEG associations, also known as AVC (advanced video codec) or MPEG-4 part 10. Moving forward, VC-1 and H.264 appear destined to equally share the role as next generation digital media standards.

The IPTV industry, which is just now showing signs of dramatic growth on a worldwide basis, is rapidly moving toward advanced set-top boxes that support both VC-1 and H.264. For network operators, these advanced codec solutions enable the delivery of high-quality video services, such as high-definition broadcasts and video-on-demand (VOD) over bandwidth limited broadband networks. By deploying set-top boxes that incorporate all codec standards, operators ensure that their investment in customer premise equipment can support future content streams in any major format.

For future DVD products, the movement to high-definition content and players is just around the corner, in two competing formats - namely HD-DVD and Blu-ray. Both camps have selected the same VC-1 and H.264 codecs, along with MPEG-2, as the basis for encoded content. Furthermore, these new DVD players will call for network connections, enhanced graphics and user interactivity that demands a very powerful media processor.

Defining A Powerful Media Processor

Sigma's SMP8634 media processor integrates a complete complement of next generation capabilities for a system-on-chip (SOC) solution for most consumer products. Key features include:

--Video decoding of H.264 (MPEG-4 part 10), VC-1 (WMV9), MPEG-2 and MPEG-4 (part 2) with multiple streams, up to the equivalent of two high-definition streams.

--High performance graphics acceleration with bit-BLT, raster operations, vector font rendering, JPEG decode acceleration and line drawing functions.

--Audio decoding capability for Dolby Digital, WMA, WMA Pro, AAC, and MPEG audio layers I, II and III (MP3) and other audio standards.

--Content security management with on-chip secure processor, flash memory, and DRM engines for high speed payload decryption of AES, DES, triple-DES, RC4, CSS, DVB-CSA and Multi-2.

--Advanced display processing capabilities, including multi-plane architecture with advanced scaling, motion adaptive de-interlacing, and image composition with pixel-based alpha blending and colorimetry and image control features.

--An array of video output options including HDMI/HDCP digital video, plus analog component and separate NTSC/PAL encoder with analog composite and S-video outputs.

--Single-chip solution with on-chip CPU, unified memory controller, Ethernet 10/100 controller, dual USB 2.0 controller, IDE controller and general purpose IO.

To ensure quick time-to-market and engineering convenience, Sigma provides a multimedia library for handling real-time video/audio/graphics, board support packages for Windows CE(R) and Linux, and sample applications for streaming media, DVD navigation, and hard-disk playback.

Sigma Designs - Powering The Digital Media Generation

For more than five years, Sigma Designs has been investing in the development of advanced high-definition media processors to drive the expansion of the digital media consumer market. Based on its advanced hardware architectures and related streaming software technologies, Sigma has established a leadership position in single-chip solutions for IPTV set-top boxes, digital media receivers and advanced DVD players. Taking advantage of this technology, consumer products are being distributed on a worldwide basis by such leading manufacturers as Cisco/KiSS Technology, D-Link, I-O Data, Kenwood, LG Electronics, Samsung, Sharp, Sony and many others.

Availability

The SMP8634 media processor will be sold through Sigma's direct sales force. Samples of the SMP8634 are available immediately. Production availability will begin in November.

Safe Harbor Statement

This press release may contain forward-looking statements, including statements about the projected timing and extent of customer shipments, as well as the expected use of Sigma's MPEG decoder products. Actual results could vary from those projected in the forward looking statements as a result of various factors, including worldwide economic conditions, changes in the customer's ability or desire to complete the roll-out, consumer reaction to the new products and services being offered, the ability of Sigma to deliver sufficient quantity and quality of MPEG decoder chips, prices for the Sigma chips, alternative offerings by competitors, and the ability of the parties to work together successfully to achieve the rollout.

About Sigma Designs, Inc.

Sigma Designs (Nasdaq: SIGM) specializes in silicon-based media processors for IPTV set-top boxes, digital media receivers, high definition DVD players, HDTV, and portable media players. The company's award-winning REALmagic(R) Video Streaming Technology is used in a variety of consumer applications providing highly integrated solutions for high-quality decoding of H.264, WMV9, MPEG-4, MPEG-2 and MPEG-1. Headquartered in Milpitas, Calif., the company also has sales offices in China, Europe, Hong Kong, Japan, Korea and Taiwan. For more information, please visit the company's web site at www.sigmadesigns.com/.

REALmagic and Sigma Designs are registered trademarks of Sigma Designs All other products and companies referred to herein are trademarks or registered trademarks of their respective companies.