On2 Technologies and Texas Instruments Collaborate on Video Devices Providing Optimized Codec Performance

Technology agreement expands On2 TrueMotion® VP6™ and VP7™ support on TI’s OMAP™ Platform and DaVinci™ Technology

TARRYTOWN, NY — On2 Technologies (AMEX:ONT), a leader in video compression solutions, announced today an extensive agreement with Texas Instruments (TI) (NYSE: TXN), under which the two companies will collaborate on technology to implement On2’s industry leading TrueMotion® VP6™ and VP7™ video compression formats on TI’s industry leading OMAP™ Platform and DaVinci™ technology for mobile handsets and digital video applications.

‘This is a far reaching agreement in that TI’s technology leads the industry for mobile handsets and IP video devices,’ said Bill Joll, president and CEO of On2 Technologies. ‘What this means for On2 and the market in general is that VP6 and VP7 based cross platform high-quality video will be available for a wide range of mobile, IPTV, and web video devices.’

Under their agreement, the two companies will share technology and development resources allowing TI to optimize VP6 and VP7 codec performance for different applications with TI’s development partners and community. Earlier this year, On2 became a TI development partner, further extending the availability of VP6 and VP7 codecs to TI’s development community.

‘On2’s video compression is setting the trend for a lot of applications in mobile handsets, web video, real time video conferencing and others, and the need for devices to support such applications is growing,’ said Charlie Gonsalves, DSP Third Party Network marketing manager, TI. ‘Through this agreement we anticipate acceleration of availability of highly optimized solutions that our customers can leverage to bring to market applications based on TI’s technology.’

On2 is a leading developer of video compression software and solutions with more than 1 billion deployments worldwide. Through the use of On2’s VP6 technology in Adobe® Flash® Player 8 and 9, On2’s VP6 technology has become a de-facto web video standard, and is widely used by leading web video sites and user generated content and social networking services. The On2 VP7 codec, the latest generation of the company’s TrueMotion codecs, is used in pioneering applications such as Skype™ video conferencing and AOL AIM®.

TI’s OMAP™ Platform is a comprehensive mix of processors, software and support that delivers the real-time processing and low power consumption necessary for 2.5G and 3G applications, including streaming media, security, interactive gaming, mobile commerce, location-based services and more. TI’s DaVinci technology is the industry’s first broadly available offering of integrated components for digital video. It consists of digital signal processing SoCs, ARM-based devices, video coprocessors, video accelerators, multimedia codecs, APIs, frameworks, development tools and comprehensive support.