ARC International and On2 Technologies Announce Codec and Processor Collaboration - VP6 Codec To Be Ported to ARC Processor Core IP

SAN JOSE, CA. and New York, NY, July 20, 2004 – ARC International (LSE: ARK), a world leader in configurable RISC CPU/DSP processor cores and application platforms and On2 Technologies, Inc., The Duck Corporation, (AMEX:ONT), a leader in video compression software, today announce their collaboration to provide video codecs optimized for the ARC processor cores. On2 will port their VP6 codec to the ARC processor core. VP6 is On2’s latest video compression software and it is used on PCs, set-top boxes, games and wireless consumer electronics products.
 
“By virtue of its flexible core IP architecture, the ARC processor family is an exciting new platform for VP6.  The combination of low power consumption, and customizable architecture configurations will help bring VP6 to a new class of devices,” said Eric Ameres, Chief Technology Officer for On2.
 
“We are pleased by this relationship because we can bring VP6 to an entire new group of customers. The flexibility and strength of the ARC processor core provides a solid platform for us as we move more deeply into the consumer electronics market,” added Douglas A. McIntyre, Chairman, President and Chief Executive Officer of On2.
 
“We have a large body of customers looking to incorporate video solutions into their next-generation digital media and consumer devices,” said Derek Meyer, ARC Marketing Vice President.  “On2 shares our vision to provide customers with a fully optimized solution for this thriving market segment.”
 
ARC Processor Cores

The ARC family of microprocessors is a set of powerful 32-bit configurable RISC CPU/DSP processor cores. The ARCtangent-A5 incorporates the ARCompact™ 16/32-bit ISA enabling a 40% reduction in code footprint compared to 32-bit only ISAs.  The ARC 600 leverages the benefits of previous architectures (small size, ARCompact ISA) and incorporates a variety of low power features, making it an ideal solution for portable consumer devices. The ARC 700, the latest processor offering from ARC, is one of the smallest processors in its performance class. The ARC 700 can make unsurpassed tradeoffs in area for performance.
 
Availability

For more information on VP6, please visit On2 at www.on2.com or contact On2 at +1.646.292.3533.  For information about the ARC Processor Cores, go to www.arc.com or contact ARC at +1.408.437.3400.
 
 
About On2 Technologies, The Duck Corporation

On2 Technologies (Amex: ONT) is a leading technology firm at the forefront of video compression. The company revolutionized digital media delivery with the creation of its advanced full-motion, full-screen, TrueMotion® VP4/VP5/VP6 compression and streaming technologies. On2’s TrueMotion codecs are used extensively in the video-on-demand, videoconferencing, Internet media, surveillance, and store-and-play markets. They operate with On2’s own TrueCast Server and Player software, as well as third-party player and server products. On2’s software is used by such leading companies as Sony, NTT, AOL, BBC, ABC News, Nullsoft, SeaChange International, China Netcom, NHK, and Nanwang Multimedia. The VP6 decoder has an installation base of millions through its inclusion in AOL 9 Media Player, Winamp 5, Viewpoint Media Player, and others. On2 licenses its software for use in set-top boxes, consumer electronics devices and wireless applications and offers high-level video encoding, customized technical support, and consulting/integration services. Located in New York City, the company has an office in Clifton Park, NY, and operations in Cambridge, UK. To contact On2 visit www.on2.com.
 
 
About ARC

ARC International is a world leader in low-power, high-performance 32-bit RISC/DSP configurable processor cores, real-time operating systems and development tools for embedded system design. ARC's configurable, extendible cores assist customers in their rapid development of next generation digital media, consumer and communications devices, resulting in exceptionally competitive System-on-Chip products.
 
ARC International maintains a worldwide presence with corporate offices in Elstree, UK and San Jose, California, USA. The Company has research and development offices located in England and the United States. For more information please visit the ARC website at: www.ARC.com. ARC International is listed on the London Stock Exchange as ARC International plc (LSE:ARK).
 
This press release may include "forward-looking statements" that involve risks and uncertainties. Factors that could cause actual results to differ are discussed in the 'Investment Considerations' section of the Company’s web site as well as the listing particulars, dated 28 September 2000, filed with the United Kingdom Listing Authority and the Registrar of Companies in England and Wales.  The Company disclaims any obligation to update any forward-looking statements.
 
ARC, the ARC logo, ARCtangent, ARCangel, ARChitect, ARCform and MetaWare are trademarks of ARC InternationalAll other brands or product names are the property of their respective holders.