Press release

08 April 1999

STMicroelectronics enters into strategic partnership to use PowerVR technology for PC Graphics and Digital Set-Top Box markets

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VideoLogic Group Plc (VideoLogic), the international multimedia and graphics company, today announced that it has agreed a strategic partnership with STMicroelectronics (formerly known as SGS-THOMSON Microelectronics) to license VideoLogic’s PowerVR 2D/3D graphics technology for the development and manufacture of a range of high performance PC graphics and video accelerators.

Two generations of PowerVR technology have already been produced within VideoLogic’s successful partnership with existing partner, NEC Corporation. PowerVR chips supplied by NEC are used by Sega in its recently announced Dreamcast games console and its Naomi arcade system, which is fast becoming the defacto arcade standard. ST’s selection of PowerVR is a significant further endorsement of the PowerVR graphics architecture with its superiority over conventional technologies in terms of performance, flexibility and the ability of the architecture to meet the needs of new growth markets. The agreement with ST is the next stage in VideoLogic’s strategy and is the second major technology partnership for PowerVR since its tie-up with NEC in 1995. ST will focus on producing and globally marketing PowerVR chips initially for the PC and, in the future, for the fast growing set-top box market. ST plans to have the first PC products resulting from this partnership available in the second half of 1999.

ST is already successful in the PC graphics market and has shipped over 5 million PC 3D graphics chips to customers worldwide. The range of PC graphics and video accelerators under development by ST and VideoLogic will extend the breakthrough performance and superior image quality of PowerVR to a larger PC customer base. The market for PC graphics/multimedia controllers is expected to rise from 130 million units in 1998 to 196 million units in 2003*.

PowerVR also enables ST to offer a leadership 3D roadmap to its Digital Consumer (Set-top box and digital television) customers, a market where ST is already the world’s leading supplier of MPEG-2 decoder chips, with over 40% market share **, and ICs for digital set-top boxes. This represents a whole new market segment for PowerVR technology. The worldwide set-top box market is forecast to reach 20 million units in 1999 **, growing at 30% annually**.

Hossein Yassaie, Managing Director of VideoLogic, said:

“”;The addition of ST as the second PowerVR technology partner, not only strengthens and expands our presence in the PC market but also brings PowerVR technology to the set-top box market as we begin to execute the second phase of our multiplatform strategy. According to Dataquest, ST has been the fastest growing of the top 10 global semiconductor companies and we consider this partnership a very significant new step in expanding the PowerVR market and customer base. ST has been highly successful in the PC graphics market and is the world leader in digital set-top decoder chips.””;

*source: Mercury Research
** source: Dataquest

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