Companies Cooperate to Develop Reference Design for Optical Storage Based Digital Video Recording Systems Optimized for the Asian Market

LAS VEGAS, Jan. 8 /PRNewswire/ -- Oak Technology, a leading provider of embedded solutions for optical storage and digital imaging, and Stream Machine, a leading provider of innovative MPEG video and audio semiconductor solutions, today announced plans to jointly develop a platform for recordable optical storage products for Video Compact Disc (VCD) and Super VCD (SVCD) applications in Asia, where these formats are widely used in consumer video players.

The market for VCD and SVCD Recordable products is anticipated to grow significantly as more affordable recordable optical storage solutions are developed for the consumer market. Oak and Stream Machine will address this market by developing a reference design based on Oak's recently introduced OTI-8001 consumer CD recordable controller and Stream Machine's SM2288 MPEG compression/decompression (codec) chip for digital video and audio.

"We are very pleased to be working with Stream Machine, a leading developer of affordable digital video codec solutions for the consumer market," said Akyra Pagoulatos, vice president, marketing and business development, for Oak Technology. "By sharing our expertise, we expect to develop platforms for highly integrated recordable digital video solutions that significantly lower cost compared to initial designs available today, without compromising features or quality. Digital video also offers significant advantages over traditional analog storage media for video, including higher quality and greater accessibility for searching or editing."

"The market for VCD and SVCD products is approximately 20 million units per year in Asia, and Steam Machine is already in volume production there with its SM2210 codec and Symphony Reference Design," said Victor Ren, vice president of sales and business development for Stream Machine. "Oak's new CD recordable consumer audio/video controller is ideal for this application because it is optimized for VCD applications and offers the highest level of integration in the market. This jointly developed reference design will significantly reduce the cost of these recorder products and accelerate the growth of digital recording in the Asian market."

Oak's Optical Storage Controller Technology

Oak, founded in 1987, has established a leadership position in the optical storage segment. The company is recognized as one of the leading suppliers of optical storage controllers, having sold more than 130 million optical storage controllers to date. Oak's latest generation of advanced CD-RW optical storage controllers have been selected by most of the top OEM suppliers of CD-RW drives. The Company's recent product development efforts in this area have focused on emerging segments such as optical storage solutions for the consumer market, as well as CD-RW and Combo drives, which are fast becoming the mainstream optical storage device for the PC market.

Oak recently introduced one of the industry's first CD Recording controllers optimized for non-PC audio and video recording applications, leveraging its state-of-the-art optical recording expertise to produce an efficient and affordable integrated solution that meets the criteria for consumer electronics industry. Oak's new OTI-8001 controller, the first in a family of Oak solutions for consumer applications and appliances, will enable the market for affordable CD-audio and video player/recorders. The OTI-8001 controller is an 8X Read/8X Write CD-Recordable/ReWritable controller intended for use in a recordable audio CD system with an inexpensive microprocessor and a minimal number of additional components. The OTI-8001's CD encoder's design also reduces the complexity and size of firmware and firmware storage required.

Stream Machine's MPEG Compression Technology

The Stream Machine SM2288 is a real-time MPEG-2 audio/video encoder and decoder. The algorithmic and architectural innovations of the SM2288 allow it to provide high quality video over a large range of bit-rates. The SM2288 is also designed to provide a high degree of system integration and ease of system design. These combined benefits make the SM2288 an ideal single-chip solution for a variety of MPEG-2 based applications such as SVCD-Recorders.

About Stream Machine Company

Stream Machine is at the heart of digital home entertainment providing cost-effective semiconductor solutions that enable industry-leading video and audio compression. Stream Machine's proprietary compression technology offers the highest quality video at the lowest possible bit-rates and is compatible with all the important consumer standards, including MPEG-1, MPEG-2, MP3 and Dolby-Digital. Stream Machine's high level of integration provides the low system cost necessary to bring DVD-quality entertainment to consumers at a price they can't resist. Please visit www.streammachine.com for more information.

About Oak Technology

Oak Technology, Inc., a leading provider of solutions for the storage, capture and sharing of digital content, is committed to driving the emerging world of connected Information Appliances. The company's fully integrated products and technologies target two key markets: optical storage (CD-RW and DVD for PC and consumer) and digital imaging (advanced copiers, printers, faxes, scanners, MFPs and iAppliances). Founded in 1987, Oak is headquartered in Sunnyvale, CA, and has sales offices, design centers and research facilities around the world. The company trades on the Nasdaq Stock Exchange under the symbol OAKT. Additional information about Oak and its digital solutions can be found at www.oaktech.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: In addition to the historical information contained herein, statements in this press release may contain forward-looking statements within the meaning of the Federal securities laws and are subject to the safe harbors created thereby. The following are among the factors that could cause actual results to differ materially from the forward-looking statements: The foregoing statements may consist of forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. Factors that could cause actual outcome to differ materially from those set forth include, without limitation, the rate of adoption of new technology, the rate of growth of the CD-RW market, changes in product mix or distribution channels; the demand for semiconductors and end- user products that incorporate semiconductors; technological difficulties and resource constraints encountered in developing and/or introducing new products, and market acceptance of new products. Forward-looking statements contained in this press release regarding expected financial results, industry trends, sales and future product development and business strategies and activities should be considered in light of these factors, and those factors discussed from time to time the Company's public reports filed with the Securities and Exchange Commission, such as those discussed under "Risk Factors" in the Company's Annual Report on Form 10K for fiscal year ending June 30, 2000, and in quarterly reports on Form 10Q.

Oak Technology is a registered trademark and the Oak logo is a trademark of Oak Technology, Inc. All other product names or company names are mentioned for identification purposes only, and may be trademarks of their respective owners.

SOURCE: Oak Technology, Inc.