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Compact, Sleek Home Theater System Expands SONICblue's Growing Line of Video Products

Continuing its expansion of versatile, integrated digital video products, SONICblue(TM) Incorporated (Nasdaq:SBLU) is introducing its new Go-Video® DHT7100 DVD instant home theater system that includes everything a consumer needs to instantly convert their television into a home theater system.

SONICblue's DVD digital home theater system carries 270 watts of total power and sports a digital AM/FM tuner, Dolby Digital® decoder, DTS digital output, subwoofer, and five wall-mountable satellite speakers for the ultimate in convenience. This ultra-compact system comes in metallic silver with a reflective front panel, and features an illuminated blue LED surrounding the volume control for a sleek, elegant look.

``Our new DHT7100 is the perfect home theater solution, enabling users to open the box and create their own all-in-one home theater, with dynamic thundering sound and crisp digital images,'' said Ed Brachocki, vice president of video products, SONICblue. ``The system carries an enormous amount of power relative to its extraordinarily compact size, setting it apart from other larger, less powerful home theater systems. Now consumers can enjoy all of their favorite digital home entertainment media in one integrated package.''

    DHT7100 DVD Home Theater System Turns Ordinary Living Rooms Into
    Home Theaters

Built into a sleek, compact design (13.8 x 3.2 x 11.8 inches), the DHT7100 is a complete home theater system that can easily be pulled out of the box, connected, and powered on in minutes, converting any living room with a television into a home theater. The combination DVD/CD player plays DVD movies, music CDs, video CDs, and MP3 on CD-R and CD-RW. The included remote takes control of the entire DVD system, including the television and AM/FM preset selection.

The built-in AM/FM tuner/receiver holds up to 30 presets, and the unit's powerful amplifier distributes up to 270 watts to the subwoofer and five satellite speakers. The unit's Dolby Digital decoder, as well as DTS audio output enables full surround sound for maximum effect. The system delivers 40 watts to each of the five satellite speakers, and 70 watts to the subwoofer for enhanced bass and realistic acoustics. Each speaker can be wall-mounted, and custom cut-to-length, speaker wire is included.

While listening to stereo soundtracks, users can leverage the system's Dolby ProLogic DSP Mode functionality to customize the sound to approximate a hall, theater, pavilion, dance club, or live club. The system also includes a password-protected rating for parental control of DVD playback.

With multiple inputs and outputs, the DHT7100 DVD home theater system connects to just about any audio or video device. The unit contains composite and S-video outputs, digital optical and subwoofer outputs, as well as outputs to the front, center, and rear speakers, as well as a separate audio input for adding other components such as a VCR. A convenient on-screen menu can be activated in English, French or Spanish.

Pricing and Availability

SONICblue's new Go-Video DHT7100 DVD home theater system retails for $399.99 and will be available through retail outlets throughout the United States. For more information please visit www.SONICblue.com.

SONICblue is demonstrating its new DHT7100 DVD home theater system at the Consumer Electronics Show in Las Vegas, January 8 - 11, at booth No. 2927, Central Hall, LVCC.

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; and Go-Video® Dual-Deck(TM) VCRs and integrated DVD+VCRs.

Except for the historical information contained herein, the matters set forth in this press release, including statements as to the expected availability, features and benefits of the Go-Video DHT7100 and the competitive position of the Go-Video brand, 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 the ability of the Company, its suppliers, retailers and distributors to meet scheduled release dates, the impact of competitive products and pricing and of alternative technological advances, 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 disclaims any intention or obligation to update or revise any forward-looking statements.

SONICblue is a trademark of SONICblue Incorporated. ReplayTV is a registered trademark of ReplayTV, Inc. Go-Video is a registered trademark of Sensory Science Corp. 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. Transfer times over broadband connections may be slower than anticipated.

Contact:

     SONICblue
     Tracy Perry, 408/588-8086 (Investor Relations)
     tperry@SONICblue.com
      or
     The Bohle Company for SONICblue
     Blake Williams, 310/785-0515 ext. 233 (Press)
     blake@bohle.com