Skymedi Adopts the ARC(TM) Video Subsystem to Create Integrated Multimedia Player Chip.

HSINCHU, Taiwan -- ARC International (LSE:ARK) today announced that Skymedi Corporation, a leading Taiwanese storage and multimedia solutions provider, has taken a license for the ARC(TM) Video Subsystem to create a fully integrated system-on-chip (SoC) targeting the burgeoning multimedia player market. The new SoC will complement Skymedi's growing portfolio of flash memory products, and will enable system OEMs and ODMs to develop handheld multimedia players rapidly and inexpensively using Skymedi's ARC-Based(TM) solution. The announcement is one of a series of new licensing agreements made public today by ARC from its Hsinchu, Taiwan office. Visit www.arc.com for more details.

"Portable multimedia players are a rapidly growing market expected to exceed 10 million units worldwide in 2007," said Dr. Jon Peddie of Jon Peddie Research, the California-based multimedia market research firm. "Consumers want to be able to access their video and audio anywhere, anytime using a range of portable devices. Tailored solutions, such as Skymedi's, fit well into the requirements of handset developers around the world: low cost, small and highly tuned to the end application."

"The standards and feature set requirements are changing in this rapidly evolving market," explained Dr. Fuja Shone, Skymedi's CEO. "ARC's configurable subsystems and ARCangel development system will enable our design team to quickly develop demonstration products that have the exact mixture of power consumption, gate count and system functionality. Additionally, ARC's Video Subsystem delivers outstanding video and audio decoding, which competing fixed architecture products cannot."

Derek Meyer, senior vice president of sales and marketing at ARC, concluded, "This is another great example of how ARC's configurable subsystems are enabling customers to differentiate and innovate in a high-growth embedded market. We welcome this new engagement with Skymedi and our growing relationship with a leading semiconductor company in Taiwan."

About the Configurable ARC(TM) Video Subsystem

The ARC Video Subsystem includes an ARC 700 family core that is coupled with the company's award winning single instruction multiple data (SIMD) accelerator, which was specifically designed for video and audio processing. A media-centric DMA engine incorporated in the ARC Video Subsystem is highly tuned to efficiently handle multimedia packet transfers. Supported video decoders include H.264, VC-1, MPEG-4 and MPEG-2. Supported imaging codecs include JPEG, MJPEG, GIF, PNG and TIFF.

The ARC Video Subsystem is programmable, enabling the customer to include additional codecs or algorithms. Because it's based upon an ARC 700 family core, the subsystem can run at up to 533 MHz in a 0.13 micron process, and developers can use the same software development tools that support a 700-class processor. The ARC SIMD accelerator in the Video Subsystem was developed to exploit data parallelism that is abundant in media applications. A single instruction can compute up to eight separate 16-bit video pixels in parallel through the use of a 128-bit wide data path. ARC's SIMD accelerator utilizes in excess of 100 new vector instructions that were specifically selected to accelerate algorithms commonly used in video and imaging applications, such as discrete cosine transforms and filters. It is directly coupled with the configurable 700 family core in the subsystem, and is more efficient than using a fixed core with a bus-connected hardwired co-processor.

About Skymedi Corporation

Skymedi, a leading storage and multimedia solution supplier, designs and markets industry-standard flash memory data storage controllers, digital imaging and audio storage controllers using its patented, the state of the art controller technology.

About ARC International plc

ARC International is the world leader in low-power, high-performance 32-bit configurable CPU/DSP processor cores, subsystems, real-time operating systems and development tools for embedded system design. ARC's patented configurable CPU technology assists customers in the development of next generation digital media, consumer and communications devices, resulting in lower cost, higher performance SoC products.

ARC International maintains a worldwide presence with corporate offices in San Jose, California, USA and Elstree, UK. The company has research and development offices located in England and the United States. For more information please visit the ARC website at: www.ARC.com. ARC International is listed on the London Stock Exchange as ARC International plc (LSE:ARK).

ARC, the ARC logo and ARC-Based are trademarks or registered trademarks of ARC International. All other brands or product names contained herein are the property of their respective owners. This press release may contain certain "forward-looking statements" that involve risks and uncertainties. For factors that could cause actual results to differ, visit the company's Website as well as the listing particulars filed with the United Kingdom Listing Authority and the Registrar of Companies in England and Wales.