iCompression and ATI Enable First True Consumer Entertainment Portal with Windows CE-Based Digital Video CODEC Set-Top Reference Design.

LOS ANGELES--(BUSINESS WIRE)--April 6, 1999--

Set-Top Wonder(TM) II reference board provides hard drive-targeted

audio, video, and system encoding, plus "pause management" via

iCompression's iVAC single-chip MPEG-2 encoder;

On view at WinHEC '99 Los Angeles

iCompression Inc., the leading developer of video and audio compression technologies for the communications and home electronics markets, in conjunction with ATI Technologies Inc. (TSE:ATY; NASDAQ:ATYT), today announced a Windows(R) CE-based digital video CODEC set-top reference design intended to make consumer entertainment portals a reality. Dubbed the "Set-Top Wonder(TM) II," the reference design is the first true consumer entertainment portal, converging the Internet, home theater, at-home digital authoring, networking and advanced 3D gaming applications into a set-top box that can meet consumer price points. iCompression and ATI will unveil and demonstrate the Set-Top Wonder II at this month's WinHEC 99 conference and exhibition.

The Set-top-Wonder II includes a MIPS microprocessor running the Microsoft(R) Windows CE operating system and ATI's Rage XL(TM) and Rage Theater graphics and video accelerators. The reference design also includes iCompression's iVAC(TM) single-chip MPEG-2 video, audio and system encoder IC that provides the "unassisted muscle" for all entertainment recording heavy lifting, as well as pause management.

"iCompression's iVAC chip handles all the difficult MPEG-2 video, audio and system encoding and muxing jobs on one chip, which made integrating their encoding sub-system into a set-top system easy and cost effective," said Dan Eiref, ATI Technologies' manager of set-top box marketing. "Utilizing iCompression's iVAC as the encoding subsystem allows for a clean, non-redundant extension to our architecture, making it an excellent building block for OEMs to reduce development time and costs. Ultimately, the ATI/iCompression solution results in faster time-to-market with superior functional advantages, two key success factors in the consumer electronics market."

"The Set-top-Wonder II reference design is truly a `first,'" proclaimed Neal Margulis, president and CEO of iCompression. "The original set-top box concept is rapidly migrating to the `home entertainment portal' which encompasses 3D games, video pause management and view-on-demand entertainment and the Set-top-Wonder II is an unprecedented building block for this. It catapults the digital consumer market into a whole new era by bringing digital recording and its benefits into a realistic consumer price model. Further, it enables consumer electronics OEMs to enter markets fast with exciting features not previously available to the average consumer."

About iCompression's iVAC

iCompression's iVAC is a single-chip MPEG-2/MPEG-1 video, audio, and system encoder available with a wide variety of interfaces for PCI, embedded, and USB standalone applications. The chip takes in raw digitized video, audio and VBI data, compresses it into the internationally standardized MPEG-2 or MPEG-1 format, and produces an MPEG-2 transport or program stream, or an MPEG-1 system stream output. The iVAC is the only product on the market that has this capability in a single-chip solution.

The iVAC incorporates a number of iCompression patented technologies including a highly optimized motion estimation architecture and highly tuned temporally sequenced encode/decode operations. Supporting iVAC is an intelligent API and a suite of Windows NT(R), Windows 98 and Windows CE drivers, which make integrating the iVAC encoding subsystem into existing applications such as PC, set-top box and DVD players, very easy. The iVAC chip is also supported by a number of reference designs for standalone embedded, USB and PCI systems.

About ATI's Set-Top-Wonder II

ATI Technologies' Set-top-Wonder II incorporates the Rage Theater video encoder/decoder and Rage XL 2D and 3D graphics engine and MPEG-2 decoder into a Windows CE-based system. Multiple PCI slots allow OEMs to add capabilities such as VSB/QAM/QPSK/CODFM receivers for cable, satellite, and terrestrial applications, or for MPEG-2 encoding for digital VCRs.

About ATI Technologies Inc.

ATI Technologies Inc., the world's largest supplier multimedia graphics chips, manufactures and markets innovative and award-winning multimedia solutions and graphics components to the personal computer, set-top box and consumer appliance markets. Founded in l985, ATI employs more than 1,600 people at headquarters in Thornhill, Ontario, and in offices in the United States, Germany, France, the United Kingdom, Ireland, Barbados, Malaysia, Japan and Hong Kong. ATI is a public company whose shares trade on the Toronto Stock Exchange and NASDAQ. For other ATI news releases visit their web site at http://www.atitech.com.

About iCompression Inc.

Founded in 1996, iCompression Inc. is a Silicon Valley, CA-based developer and marketer of video and audio compression technologies for the communications and home electronics markets, and was the first company to develop and market a single-chip MPEG-2 video, audio and program or transport stream encoder, the iVAC chip.

With an impressive engineering legacy of successfully designing audio and video, CPU and high-speed bus products at such industry leaders as Sun Microsystems, Silicon Graphics, IBM, LSI Logic and S3, iCompression's core management and technical staff develops highly integrated, industry-first, low-cost silicon solutions. The company has employed several patent-pending technologies that enable it to combine many functions onto a single chip, ensuring the low cost and small form factor required by the makers of consumer devices. iCompression's iVAC line of MPEG-2 encoding products will begin shipping in mid-1999 and will be sold directly through iCompression. More information on iCompression Inc. and its products can be obtained at www.icompression.com, or via phone at [phone].

Note to Editors: iCompression, iVAC are trademarks of iCompression, Inc. Other product names mentioned herein are for identification purposes only and may be trademarks and or registered trademarks of their respective companies.

ADDITIONAL KEYWORDS: ATI, C-Cubed, consumer electronics, high tech, iCompression, NEC, set top, settop, Sony, SVCD, system on chip, SOC, VCD, VCR, digital VCR, WinHEC conference, trade show, tradeshow