Infineon Technologies Chooses On2 For Video Codecs

World leading manufacturer of wireless chipsets to integrate Hantro™ hardware video acceleration.

Tarrytown, NY -- February 11, 2008 -- On2 Technologies, Inc. (Amex: ONT), a leader in video compression technologies, announced today that Infineon Technologies AG (FSE/ NYSE: IFX) has signed a multiple use license agreement for integrating the On2’s latest Hantro video accelerators. Configurable to support popular standard and proprietary video formats in resolutions from QCIF up to 720p High Definition, the encoder and the decoder RTL designs will be integrated to several Infineon baseband chipsets targeted for high volume mobile handsets.

Under the terms of the agreement On2 will provide Infineon with several configurations of the codec solution; the format and resolution support are specified during the system integration phase of the chip projects thus providing Infineon with maximum flexibility to ensure they achieve an optimum combination of silicon area utilization and functionality for their target markets.

“"Infineon have shipped more than a billion wireless chipsets and is expected to gain significant market share in 2G and 3G markets,"” says Bill Joll, President and CEO of On2. “"This kind of success is testament to their consistent ability to competitively deliver leading edge products of the highest quality. We are extremely proud to be chosen as the video technology provider for their next generation chipsets."”

By using On2™ RTL designs, Infineon is able to offload the complex calculations needed for video compression and decompression from the chip’s processor core. This makes full motion video record and playback possible, without having high CPU load for video processing. In addition, the solution is extremely power efficient which means that consumers with handsets built on the Infineon chipset can enjoy longer video capture and playback time on a single charge.

“"High quality video capability is virtually a pre-requisite for all feature-phone handsets, and integrating support into the baseband chipset is the best way to marry the performance consumers expect with the price they are willing to pay,"” said Clemens Jargon, Infineon’s Vice President and General Manager of the Feature Phone Business Unit.  “"With the On2’s video accelerators, we are able to provide device manufacturers with highly competitive leading edge solutions for entry level through to high-end multimedia handset designs."

Infineon is using the On2 video accelerators in the 3G and higher end 2.5G variants of their 65nm baseband family. First products of this family are sampling now. Infineon has been shipping its communication ICs for more than 15 years to all major companies in the mobile phone segment, including Nokia, Samsung, Motorola, Sony Ericsson and LG.

About Infineon
Infineon Technologies AG, Neubiberg, Germany, offers semiconductor and system solutions addressing three central challenges to modern society: energy efficiency, communications, and security. In the 2007 fiscal year (ending September), the company reported sales of Euro 7.7 billion (including Qimonda sales of Euro 3.6 billion) with approximately 43,000 employees worldwide (including approximately 13,500 Qimonda employees). With a global presence, Infineon operates through its subsidiaries in the U.S. from Milpitas, CA, in the Asia-Pacific region from Singapore, and in Japan from Tokyo. Infineon is listed on the Frankfurt Stock Exchange and on the New York Stock Exchange (ticker symbol: IFX).

About On2
On2 Technologies (AMEX: ONT) ensures a compelling video experience for any video application anywhere. From low bit rate to high definition, On2 provides optimized video compression technology enabling innovative solutions for application developers, content and service providers, chip vendors, device manufacturers, digital signage companies and beyond.

Through continual innovation, On2 satisfies the toughest quality, bandwidth, and power requirements for video. The company's proprietary (TrueMotion® VP6™, VP7™) and standards based (MPEG-2, MPEG-4, H.263, H.264, VC-1) codecs dominate the video market, with more than 1 billion deployments on desktops worldwide and more than 200+ million in mobile; they are also proven in silicon with over 25 semiconductor manufacturers globally.

Established in 1992 and headquartered in Tarrytown, New York, On2 has offices and partners in Finland, Germany, UK, Japan, China, Taiwan, Korea and India. Customers include Nokia, Samsung, Freescale, AMS, Atmel, Adobe/Macromedia, AOL, Sony, Skype, Facebook, VideoEgg, Brightcove, Move Networks and XM Satellite Radio. For more information please visit www.on2.com.