ATI Brings High-Definition Television To The Rest of Us

New Theater™ products deliver industry leading digital reception cost effectively

MARKHAM, Ontario, July 6, 2005 – ATI Technologies Inc. (NASDAQ: ATYT)(TSX: ATY), the leader⁽¹⁾ of the VSB receiver chip market, just made high-definition reception for television sets more affordable with the introduction of the Theater™ 311, Theater™ 312 and Theater™ 314 chipset solutions. ATI’s Digital Television group has created this new technology for high-definition TV (HDTV) manufacturers to deliver outstanding high-definition TV signal reception while reducing overall production cost. ATI is offering these solutions to help ensure that ‘no viewer is left behind’ as the broadcast industry works through the digital transition.

ATI developed the new Theater chips as a response to current and future HDTV requirements. More specifically, the United States Federal Communications Commission (FCC) has recently reaffirmed the digital tuner mandate requiring 50 per cent of all 25-inch to 35-inch TVs include digital tuners by July 1, 2005 and accelerated the 100 per cent mandate for this same segment from July 1, 2006 to March 1, 2006. The FCC has also announced it is considering shifting the mandate for digital tuners in 13-inch and greater sets to December 31, 2006. Simultaneously, United States legislators are also now proposing a hard shut-off date for off-air National Television System Committee standard transmissions as early as 2008. This mandate and legislation, along with increasing consumer demand, are driving TV manufacturers to convert mid- and low-end TV products to digital formats at an unprecedented rate.

Until now, converting analog consumer products to digital in this short time has left manufacturers with a tough choice. They have had to lower the cost by integrating low performance vestigial sideband (VSB) receivers that limit the ability to receive the digital signals and hope the end customer will not notice. Or, embed a high-performance receiver that can cost a few dollars more. As a result, less price sensitive large screen digital televisions (DTVs) are likely to have the best off-air reception, but they are more likely to be connected to a cable or satellite set-top box (STB) receiver. Mid- and low-end DTVs are likely to be used for off-air reception and are more likely to include an inferior cheaper receiver increasing the risk that these TVs may go dark when analog is shut off. ATI developed the Theater 311, Theater 312, and Theater 314 receiver chip solutions to help ensure that this scenario does not become a reality during the digital transition.

“ATI has always delivered the highest quality digital TV reception technology in the world,” said Mike Gittings, Director of Marketing, DTV Products, ATI Technologies Inc. “We’re making sure that HDTV and consumer electronics manufacturers have the best HD reception technology possible today so consumers’ TV screens stay lit once the analog-off-air signals are shut off.”

The recent RFQ (request for quote) from The Association for Maximum Service Television, Inc. (MSTV) for a TDCB (Terrestrial Digital-to-Analog Set-Top Converter Box) re-affirms the need for high-performance, cost-effective VSB reception. In a press release announcing the request for quotes, MSTV underscored the need for a consumer friendly, low-cost, high quality receiver so that ‘No viewer is left behind’ in the digital transition.

Quality HDTV manufacturers, such as Funai Electric Co., Ltd, recognize the need for high quality, cost-effective, HDTV reception. Funai, a strategic partner of ATI, ships more mid-range TVs and set-top boxes to the North American market than any other single manufacturer. Funai is also known in North America for its popular Emerson, Sylvania, and Symphonic brands. THEATER™ 311 will be available in Funai’s consumer products later this year.

The new Theater products provide industry leading VSB reception at affordable prices to all segments of the digital over-the-air (OTA) and digital cable ready (DCR) TV market. Extensive testing by ATI and ATI’s customers prove that these devices are the highest performing receivers available on the market today. Test methods utilizing proven Advanced Television Systems Committee (ATSC) recommended practice A/74 field scenarios for receiver performance demonstrate ATI’s superiority when it comes to delivering high quality HDTV signal reception. In a recent inquiry, the FCC stated that they plan to sample and test retail OTA reception in DTVs and STBs. ATI filed comments encouraging the FCC to use the A/74 industry standard test methods to validate performance.

Available now for evaluation, Theater 311, Theater 312 and Theater 314 offer scalable solutions for today’s consumer products. The Theater 311 VSB receiver is ideal for applications that require highest OTA performance at a low price and do not require cable compatibility such as: Satellite STBs that require local OTA reception; TDCBs and non-cable compatible DTVs; Personal Computer DTV; Personal Video Recorders and writeable HD-DVDs. The Theater 312 adds clear 64 and 256 QAM reception to the Theater 311 for clear QAM cable reception. DCR applications are enabled by the Theater 314 which adds universal Forward Data Channel (FDC) reception. All chips also feature ATI’s field proven smart antenna technology.

About ATI Technologies
ATI Technologies Inc. is the world leader in the design and manufacture of innovative 3D graphics and digital media silicon solutions. An industry pioneer since 1985, ATI is the world’s foremost graphics processor unit (GPU) provider and is dedicated to deliver leading-edge performance solutions for the full range of PC and Mac desktop and notebook platforms, workstation, set-top and digital television, game console and handheld device markets. With 2004 revenues of approximately US $2 billion, ATI has more than 2,700 employees in the Americas, Europe and Asia. ATI common shares trade on NASDAQ (ATYT) and the Toronto Stock Exchange (ATY).

⁽¹⁾ According to Strategy Analytics, 2.5 Million Integrated DTVs were sold in 2004. According to Internal ATI sales figures, ATI sold over 2 Million VSB chips in 2004.

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