Massana Launches Strategy to Address Burgeoning Broadband Communications Market

Company Adopts Fabless Semiconductor Business Model;
Initial Products to Target Gigabit Ethernet Market

Palo Alto, Calif., February 12, 2001 - Massana Inc., an innovator of smart math in silicon for broadband digital communications, today unveiled its strategy to deliver industry-leading solutions that meet the exploding demand for Internet bandwidth across wired and wireless media. Historically a design services and intellectual property (IP) provider, Massana has adopted a fabless semiconductor business model that leverages its unique "smart math" approach and signal processing expertise to provide customers with a new level of broadband capability. As part of this strategy, Massana will work with TSMC, a world-leading foundry, to manufacture semiconductor products. Massana?s first silicon products will target the gigabit Ethernet-over-copper market with high-performance, low-power solutions for switches, routers, network interface cards (NICs) and network attached storage (NAS) applications.

"System vendors are working at the cutting edge of communications technology where time-to-market and performance are critical elements to product success," said Paul Costigan, CEO of Massana. "Moving to a fabless semiconductor business model will allow us to partner with our systems customers in order to identify first-hand the design issues they face. Additionally, by working directly with system designers on end-product development, we will be able to deliver the value of our advanced technology in a more timely manner, helping them meet their tight market windows."

Gigabit Ethernet Market Opportunity

As a fabless semiconductor company, Massana will design silicon for the broadband communications market. The company initially will target the exploding gigabit Ethernet PHY market. Indeed, according to forecasts made by Merrill Lynch, the overall gigabit Ethernet semiconductor market for LAN applications, which includes products such as PHYs, MACs and fabric switches, is expected grow 56 percent annually to $998 million by 2004. Likewise the gigabit Ethernet semiconductor market for NIC applications is expected to grow 156 percent annually to $944 million by the same year.

"The development of the broadband data infrastructure has created staggering demand for Internet ICs - off-the-shelf integrated circuits designed specifically for broadband data applications - to effectively enable timely and cost-effective delivery of bandwidth," said Clark Westmont, Communications IC analyst at Salomon Smith Barney. "With its patented approach to semiconductor design and its history of successful communications design as a design services and IP provider, Massana is in a good position to deliver solutions that enable this exploding demand for voice, video and data access over the Web."

The Mounting "First Mile" Broadband Access Challenge

After solving the gigabit Ethernet challenge for the LAN/WAN or "backbone" of the Internet, Massana believes the next problem will be delivering broadband access to the user - often referred to as the "first mile." As a member of the IEEE Ethernet-in-the-first-mile task force, Massana is helping to define a standard for delivering voice, video and data to the consumer over the existing copper infrastructure. Moving forward, Massana will leverage its technology and experience to deliver standards-based products that solve this growing first mile broadband access challenge.

Massana?s Approach to Silicon Design

Massana engineers apply the company?s unique smart math approach, proprietary methodologies and custom signal processing architectures to create next-generation products for the high-performance, high-speed, low-power networking and broadband communications markets. Massana?s design teams in Dublin, Ireland and Madrid, Spain are experts in analog, mixed-signal and silicon design. Massana is a member of the prestigious TSMC "Emerging Companies Program," and is working with TSMC to deliver semiconductors in volume to communications system designers.

About Massana

Massana is an innovator of smart math in silicon for broadband digital communications. Massana combines its proprietary methodologies and custom signal processing architectures to take complex mathematics to silicon. By applying this unique approach, Massana provides customers with a new level of broadband capability to meet the exploding demand for wired and wireless Internet bandwidth. Massana is a global technology company with its U.S. headquarters in Palo Alto, Calif., European headquarters and a design center in Dublin, Ireland and a design center in Madrid, Spain. For more information on Massana, visit http://www.massana.com.

For More Information Contact:

Brendan O'Flaherty
Massana Inc.
650/566-0478
brendan.oflaherty@massana.com

Lisa Neitzel
Tsantes & Associates
408/369-1500 x23
lisa@tsantes.com