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SAND VIDEO TO DEMONSTRATE AVC/H.264 HIGH DEFINITION PVR/DVR TECHNOLOGY AT IBC2003

Sand Video on track to deliver AVC/H.264 encoder-decoder chip in early 2004

ANDOVER, MA ‚ Sept. 2, 2003‚ Sand Video, Inc., a recognized expert in Advanced Video Coding/H.264 semiconductor video compression technology, will demonstrate its proprietary MPEG-2 to H.264 transcoding techniques and real-time high definition AVC/H.264 decoding at the International Broadcast Convention (IBC) Show 2003 in Amsterdam, Sept. 11-16. The demonstration, at booth 7.820 (Building 7, Row 800, Space 20), will show that AVC/H.264 technology can re-encode and preserve image quality at bit-rates of up to three times less than MPEG-2.

"AVC/H.264 can substantially reduce costs and improve performance in standalone and set-top box PVR/DVRs and DVD recorders," said Don Shulsinger, Executive Vice President Sales and Marketing, Sand Video. "Hard disk drives are a substantial cost element in these devices and with high definition capabilities becoming more and more prevalent, OEM's must find a way to store this content without adding additional drive capacity and thus significant added cost. Sand Video's AVC/H.264 technology is designed to allow OEMs to easily incorporate these advanced compression capabilities and gain a significant competitive advantage in their respective markets."

The benefits of H.264 go beyond PVRs.

Demand for video compression devices is expected to grow significantly over the next two years. According to industry analysts such as IDC, Dataquest, In-Stat and CIBC, the market for video compression devices will exceed more than 200 million units and $2.3 billion by 2005. Recent industry announcements, such as Sony announcing support for AVC/H.264 in its upcoming portable PlayStation™, show a growing interest and demand in bringing AVC/H.264 to real consumer products.

Sand Video Enables the Industry to Adopt AVC/H.264 with SV-IP01
In July, Sand Video announced the availability of the SV-IP01, the first high-definition capable real-time AVC/H.264 decoder core. As the only company currently offering fully compliant, fully featured real-time high definition AVC/H.264 decompression, Sand Video's SV-IP01 represents a major step forward in the industry for the development of commercial AVC/H.264 digital video products.

Sand Video's SV-IP01 core is capable of decoding high definition MPEG-2 streams, and can support existing codec applications as well. Implementing the AVC standard Main Profile, the SV-IP01 supports all digital broadcast formats up to and including 720p and 1080i. The core includes support for the complete set of Main Profile AVC tools, including Context-Based Adaptive Binary Arithmetic Coding (CABAC) and Context Adaptive Variable-Length coding (CAVLC).

Sand Video's codec chip family, the Advantage264™, is in development, and the company expects to offer commercial samples to customers in Q1 of 2004. The SV-C011 full codec and the SV-D011 decoder chip will be the initial products in the codec family.

The AVC/H.264 algorithm delivers between two and three times the compression performance of MPEG-2 for a broad range of consumer video applications such as cable and satellite TV transmission, set-top-boxes, DVD players and recorders, personal video recorders (PVRs), digital cameras and camcorders. Systems incorporating Sand Video's codec will deliver superior image quality, storage capacity and system performance. Sand Video's codec technology may be applied easily to other applications such as streaming video, video conferencing, and digital video-on-demand.

"Demonstrating transcoding capabilities at IBC shows that Sand Video is the innovation pacesetter in the field of digital video compression. Our technology will result in dramatic improvements in system cost, performance and image quality," Mr. Shulsinger added.

Solving H.264 Complexity
Also known as MPEG-4 Part 10, AVC/H.264 is the next-generation video compression standard developed jointly by the ITU and ISO. The standard is much more complex than existing MPEG standards, and requires a completely new architecture to fully realize its performance benefits. AVC/H.264 has been ratified by ITU and is expected to be ratified by ISO by the end of year.

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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