ESS INTRODUCES ITS FIRST VIDEO CHIP PRODUCT -- MPEG-1 DECODER; ESS COMPLETES VIDEOCORE ACQUISITION AND SIGNS MPEG-2 AGREEMENT FREMONT, Calif., Jan. 24 /PRNewswire-AsiaNet/ -- ESS Technology, Inc. (Nasdaq: ESST) today introduced the ES3204, a highly integrated real-time MPEG-1 decoder chip targeting emerging applications in multimedia PCs and consumer audio/video electronics. The ES3204 is ESS' first product in a video chip product family for real-time video and multimedia systems currently under development. "The ES3204 is a single-chip MPEG-1 video, audio and system decoder designed for a wide range of digital video playback applications, including Karaoke players, video CD, PC MPEG playback cards and CD-XA video playback," stated Bill Windsor, Strategic Marketing Manager at ESS. "The ES3204 delivers full-screen, full-motion video at 30 frames per second with selectable 44.1 kHz or 48.0 kHz CD-quality audio. When combined with memory and video/audio DACs, the ES3204 makes a highly integrated MPEG-1 decoder system, with lower system cost than previously attainable." The ES3204 is a complete MPEG-1 decoder on a chip. It decodes MPEG-1 bitstream rates ranging from 1.2 to 9.0 megabits per second, covering the range of applications from a single-speed up to a six-speed PC CD-ROM. The ES3204 generates full-screen video output at a picture rate of 30 frames per second, system control to synchronize audio and video playback, and on-chip video scaling. The ES3204's MPEG-1 video output is in YUV or RGB format, which is transmitted to an RGB, NTSC or PAL video DAC to the monitor screen. The ES3204 chip with bundled software drivers is compatible with DOS games, Microsoft Video for Windows, VideoCD, Karaoke and CDi standards. The ES3204 is priced at $32.00 in 10,000 piece quantities and is expected to be in volume production by April 1996. ESS also announced it completed the acquisition of VideoCore Technology, Inc., pursuant to which ESS will acquire all of the outstanding stock of VideoCore for 525,000 shares of ESS Common Stock and $6.0 million in cash. VideoCore, a privately held corporation, is developing integrated circuits which, once completed, will incorporate advanced compression technology for digital video products. The acquisition will be accounted for as a purchase, and a substantial majority of the purchase price is attributable to research and development in-process, which will be expensed in the first calendar quarter of 1996. Fred Chan, Chairman and Chief Executive Officer of ESS said, "The VideoCore acquisition adds to our product opportunities in the multimedia PC and consumer markets. VideoCore will focus on both the MPEG-1 video markets as well as MPEG-2 and videoconferencing areas." Commenting on a related technology arrangement completed this week, Chan added, "We've signed an agreement with a consumer electronics company to jointly develop a MPEG-2 decoder chip. We're excited about this opportunity in the consumer market for our future products. Since 1984 ESS manufactured over 70 million audio products for the high-volume consumer market, before entering the PC market." ESS Technology, Inc., headquartered in Fremont, California, pioneered and is the leading supplier of mixed signal PC audio solutions that integrate all essential audio components on a single chip. ESS is committed to expanding its multimedia semiconductor product families by leveraging its expertise in digital, analog, and mixed signal technologies and software, along with its customer base and manufacturing partnerships.NOTE TO EDITORS: ESS Technology press releases are available at no charge through PR Newswire's Company News On-Call fax service and on PRN's Web site. For a menu of ESS Technology press releases or to retrieve a specific release, call 800-758-5804, extension 108866, or http://www.prnewswire.com on the Internet./ CONTACT: investors, Ralph J. Harms, VP Finance, CFO, 510-226-1088, Ext. 102, or media, Albert Mak, VP Marketing, 510-226-1088, Ext. 111, both of ESS Technology/