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Company to Demo Award-Winning ReplayTV 4000 and Rio Advanced Digital Audio Center

New Products

On the first day of CES (Tuesday, January 8), SONICblue will announce two new products to be released shortly after the show -- a 20GB hard drive-based Rio portable digital audio player and a complete Go-Video® home theater system. Expanding SONICblue's product offering into new categories of the digital audio and DVD player markets, the new Rio and Go-Video products will be available for hands-on demo in SONICblue's CES display (booth no. 2927, Central Hall, LVCC). Complete features sets and specifications of these new products will be made public through Company press releases on January 8.

First Public Showing

SONICblue's recently announced Rio Advanced Digital Audio Center home stereo component and ReplayTV 4000 Digital Video Recorder will be publicly shown for the first time at CES. Key building blocks of SONICblue's digital home vision, the Rio Audio Center and ReplayTV 4000 redefine their respective product categories. The ReplayTV 4000 has been named one of ``The Best Products of 2001'' by BusinessWeek magazine and has received one of the coveted 2001 ``Best of What's New'' awards from Popular Science magazine. In addition, the Consumer Electronics Association (CEA) honored both the ReplayTV 4000 and the Rio Audio Center with its prestigious Innovations 2002 design and engineering award.

Executive Panel Participation

SONICblue CEO and chairman, Ken Potashner, as well as SONICblue chief technology officer, Andrew Wolfe, will appear on influential industry panels at CES. On Tuesday, January 8 at 11:30 a.m., Potashner will participate as a panelist in a CES Digital Download SuperSession entitled ``Cracking the Code to Profitability.'' Featuring additional executives from Digital Media Association, Verance Corporation and the Motion Picture Association of America, the panel will address balancing the need to protect Intellectual Property and content with the manufacturer's right to develop and market new technology. Following Potashner's appearance, on Wednesday, January 9 at 1:30 p.m., Wolfe will participate as a panelist in a CES session entitled ``An Inside Look at Digital Audio Products and Digital Rights Management.'' On this panel, Wolfe will be joined by executives from Rightscom, Warner Music Group and Kenwood USA.

About SONICblue Incorporated (www.SONICblue.com)

SONICblue is a leader in the converging Internet, digital media, entertainment and consumer electronics markets. Working with partners that include some of the biggest brands in consumer electronics, SONICblue creates and markets products that let consumers enjoy all the benefits of a digital home and connected lifestyle. SONICblue holds significant financial assets, global marketing capabilities and a focused technology portfolio that includes Rio digital audio players; ProGear(TM) Information Appliances; ReplayTV personal television technology and software solutions; Go-Video Dual-Deck(TM) VCRs and integrated DVD+VCRs and California Audio Labs(TM) high-end home entertainment theater components.

For more information or to book a meeting at CES:

Press Contact:                    Investor Contact:
Bryce Baer                        Tracy Perry
The Bohle Company                 SONICblue
310/785-0515 ext. 252             408/588-8086
bryce@bohle.com                   tperry@sonicblue.com

Paul Crossley
SONICblue
(503) 453-1473
pcrossley@sonicblue.com

Except for the historical information contained herein, the matters set forth in this press release are forward-looking statements within the meaning of the ``safe harbor'' provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including, but not limited to, manufacturing difficulties, possible delays in the release of products, and other risks detailed from time to time in the SEC reports of SONICblue Incorporated (formerly S3 Incorporated), including its quarterly report on Form 10-Q for the quarter ended September 30, 2001. These forward-looking statements speak only as of the date hereof. SONICblue and Rio disclaim any intention or obligation to update or revise any forward-looking statements.

Note to Editors: SONICblue is a trademark of SONICblue Incorporated. ReplayTV is a registered trademark of SONICblue Incorporated. Rio is a registered trademark of RioPort, Inc. and is used by SONICblue under license from RioPort Inc. All other products and brand names as they appear in this release are trademarks or registered trademarks of their respective holders. All specifications may be changed without notice.

Contact:

     SONICblue
     Paul Crossley, 503/453-1473 (Press)
     pcrossley@sonicblue.com
     Tracy Perry, 408/588-8086 (Investors)
     tperry@sonicblue.com
               or
     The Bohle Company
     Bryce Baer, 310/785-0515 ext. 252 (Press)
     bryce@bohle.com