CALGARY, Alberta--(BUSINESS WIRE)--June 3, 1999-- QSound Labs Inc. (Nasdaq:QSND - news), a leading supplier of digital and analog audio solutions, announced that Sanrupid Electronic Co. Ltd. and ChangHong Electronics Group Corp. have begun shipping QSound-enhanced products in China.

These products feature QSound's QMSS(tm) (QSound Multi-Speaker System) and QMDV(tm) (QSound Matrix Surround Decoder/Virtualizer) which are part of the QSurround(tm) family of technologies.

Sanrupid has incorporated these technologies comprehensively in their entry level, mid and high-end speaker models. One of China's largest manufacturers of high quality speakers, Sanrupid holds a significant portion of the speaker market domestically. It also exports its products to the United States, United Kingdom, Japan, South Korea and SE Asia.

``By offering QSound's 3D audio technology in our products, we are providing our customers with a value-added feature that is easily recognizable and one that clearly differentiates Sanrupid from its competitors,'' said Huang Yuyan, Vice President, Sanrupid Electronic.

ChangHong recently introduced its new line of ``Virtual Cinema'' color televisions with QSound's QMDV processing. The first of its kind in China, the T2981S provides consumers with the most advanced ``virtual surround'' sound processing from any source -- mono, stereo or multi-channel. The unit provides all the advantages of a 4 or 5.1 system with only two speakers. ChangHong is a progressive, leading-edge company whose share of the colour television market within China rose to 35 percent in 1998.

``These design wins are the direct result of our aggressive marketing efforts in China during the past six months,'' said David Gallagher, President, QSound Labs. ``By continuing to develop relationships within China, we anticipate that QSound will become the 3D audio technology of choice by the leading Chinese consumer electronics manufacturers.''

About QMSS

The QSound Multi-Speaker System transforms ordinary stereo (two-channel) and even mono (single-channel) audio content into four or more unique outputs for reproduction on multiple speakers. With true stereo material, the acoustic image (i.e. the left-to-right positions of individual sound elements) is effectively wrapped around the listener, retaining correct and distinct relative placement. For mono content, a surround image is synthesized with remarkable realism. Clarity and fidelity are maintained by avoiding the use of artificial reverberation or tone manipulations.

About QMDV

The QSound Matrix Surround Decoder/Virtualizer provides a cost-effective solution for the virtualization of matrix surround-encoded stereo streams by eliminating the need for a separate matrix decoder. When the input signal is plain stereo, QSound's QXpander(tm) stereo soundfield expansion is applied. When the signal is in matrix surround format, virtualization takes place automatically creating the effect of a multi-speaker surround soundfield using only two physical speakers.

About Sanrupid Electronic Co. Ltd.

Located in Shenzhen, China, Sanrupid manufacturers multi-media products, Hi-Fi audio and home theater systems. With state-of-the-art facilities, Sanrupid is a complete manufacturing facility which designs, molds, assembles and final tests its products. For more information, visit our Web Site at http://sanrupid.com.

About ChangHong Electronics Group Corp.

Based in Sichuan China, ChangHong designs, develops and produces, electronic components, power equipment, small home appliances, and printed circuit boards. In 1995, 1996 and 1997 ChangHong ranked first among China's top 100 electronics corporations.

About QSound Labs Inc.

Founded in 1988, Calgary-based QSound Labs Inc. (Nasdaq:QSND - news), is a technology company specializing in software audio applications for the Internet, PC/multimedia, Consumer Electronics and Healthcare industries. Its patented technologies provide these industries with immersive, realistic sound environments that include positional audio, stereo enhancement and virtual surround sound solutions. A key contributing factor to the success of QSound Labs' Internet audio software products has been the development of a unique enabling technology and implementation of an Affiliate Program, a turnkey solution for the marketing and sales of any product via the Internet. For more information, visit our Web site at http://www.qsound.com.

All product and brand names are trademarks and/or registered trademarks of their respective owners. Additional news releases may be obtained via the Internet at www.qsound.com/press0.htm or by calling the company directly at 403/291-2492.

This release contains forward-looking statements within the meaning of the Private Securities Litigation Act of 1995 concerning, among other things, the anticipated introduction of new products and projected shipment dates of products and future financial results. Investors are cautioned that such forward-looking statements involve risk and uncertainties, which could cause actual results, performance or achievements of the Company, or industry results to differ materially from those reflected in the forward-looking statements. Such risks and uncertainties include, but are not limited to, risks associated with the commercialization of the Company's technologies, dependence on the performance of third parties who have licensed the Company's technologies, dependence on intellectual property, uncertainties relating to product development and commercial introduction, rapid technological change and competition, manufacturing uncertainties and other risks detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission. Forward-looking statements are based on the current expectations, projections and opinions of the Company's management, and the Company undertakes no obligation to publicly release the results of any revisions to such forward-looking statements which may be made, for example to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Contact:

     QSound Labs Inc., Calgary

     Paula Murray, 954/796-8798

     paula.murray@qsound.com

     www.qsound.com