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The technology is the key feature in a family of software and hardware products, called WOW Thing(TM), launched in September of 1999. The first WOW Thing products are a downloadable, shareware plug-in for the popular media player Winamp(TM); and a translucent-blue consumer device, designed specifically for headphones or powered speakers, including flat panel speakers or those designed for the iMac(TM).

In the last few months alone, WOW has garnered rave reviews from high-tech industry insiders, such as ZDNet, PC World and PC Magazine, and has been featured in Forbes, Fortune, Entertainment Weekly, The New York Times, The Chicago Sun-Times and The Dallas Morning News. The WOW Thing box, which sells for $29.95 from the Company's e-commerce website, http://www.wowthing.com, is one of three finalists for the prestigious Macworld Eddy(TM) award for ``Best New Consumer Hardware Product of the Year.'' The software plug-in is available through a variety of download sites online, including http://www.wowthing.com, http://www.zdnet.com and http://www.download.com.

SRS Labs is rigorously protecting the application of its audio and voice enhancement technologies for use on the Internet, where the ability to significantly increase audio quality is met with great demand. While the delivery of music and entertainment programs via the Internet has created a significant market for content providers, current bandwidth and compression formats result in poor quality audio playback. This situation has created a unique market opportunity for SRS Labs. By leveraging its portfolio of sound and voice technologies and optimizing them for the broadcast and playback of Internet audio and video, the Company can offer a key differentiating and licensable feature for any online music and entertainment site.

One important aspect of the patent filings is the ability for SRS Labs to control the implementation of its enhancement and enabling technologies based on licensing partnerships. SRS Labs is able to insure the value of a partner's investment by allowing dramatically improved audio performance from any licensed partner's site exclusively through their content. SRS Labs announced its first Internet audio technology license agreement with WWW.COM, the largest online radio network consisting of more than 210 stations and 275,000 songs.

``Our heritage and strength is providing advanced audio technologies for the hi-fi and home theater markets,'' stated Chuck Cortright, vice president and general manager of SRSWOWcast.com, Inc., SRS Labs' wholly owned subsidiary. ``Last month we exhibited at Webnoize '99, one of the leading new media digital music conferences. The response to our WOW technology from the entertainment and music netcasters participating at Webnoize validated our conclusion that our audio enhancement capabilities can be leveraged successfully onto the Internet.''

Additional patents were filed by the Company for the next generation of audio enhancement on the Internet beyond stereo. These technologies are designed to facilitate and enhance virtual surround sound as well as 5.1 discrete channels of surround sound. SRS Labs' Circle Surround(TM) 5.1 (CS 5.1) technology has been adapted for use as a multi-channel Internet audio delivery technology. CS 5.1 enables the encoding of 5.1 high-quality channels on just two channels of audio. These two channels can then be efficiently transmitted over the Internet using any of the popular compression schemes, and received by the listener where a CS 5.1 decoder creates full multi-channel audio from the two-channel stream.

While multi-channel audio is increasingly available as source material in music and film delivered via the Internet, bandwidth and hardware limitations will continue to restrict playback to two speakers in a PC environment. To address this issue, SRS Labs' virtualization technology, TruSurround(TM), has been integrated with the multi-channel output from the Circle Surround software decoder. This unprecedented combination allows surround sound playback even from mono sources on a two-speaker system without loss of surround sound effects. TruSurround has become a standard for multi-channel virtual surround playback on DVD players, televisions and consumer set-top box systems, and SRS Labs has developed the bridge to bring this standard to the Internet.

About SRSWOWcast.com, the Best Sounding Site on the World Wide Web(TM)

SRSWOWcast.com, Inc. is a wholly owned subsidiary of SRS Labs, Inc. (Nasdaq: SRSL - news), the world's leading developer and licensor of patented and award-winning audio and voice technologies. SRS Labs' technologies are included in a wide variety of consumer electronics, automotive, cinema sound and telecommunications equipment from over 170 companies, including such industry giants as Sony, RCA, Pioneer, Philips, Kenwood, Samsung, Lucent, General Instrument and Sennheiser.

With the exclusive Internet rights to SRS Labs' portfolio of audio and voice technologies, SRSWOWcast.com will be the first online entertainment site that combines advanced stereo enhancement and surround sound internet broadcast audio technologies with a diverse library of music and video content via an interactive community-based presentation. SRSWOWcast.com will feature a wide selection of music genres, interactive music community, live concert performances, music chat lounges, audio-based infotainment, a music store for purchase of hardware and software and an artist colony showcasing unsigned, independent artists. Continually expanding beyond the Company's flagship WOW Thing products, SRSWOWcast.com's e-commerce offerings will include other innovative audio and video multimedia products incorporating SRS Labs' industry-leading sound enhancement technologies. SRSWOWcast.com will be officially launched and will be live for the CES show in Las Vegas on January 6, 2000.

SRS and the SRS symbol are registered trademarks of SRS Labs, Inc. in the United States and selected foreign countries. WOW Thing, Circle Surround, WOW, and TruSurround are trademarks of SRS Labs, Inc. All other brand names mentioned are trademarks or registered trademarks of their respective holders.

Except for historical information contained herein, the statements of Mr. Cortright in paragraph six of this release and Company statements in paragraph four of this release include forward-looking statements and projections (including statements concerning plans and objectives of management for future operations) that are based on management's belief, as well as assumptions made by, and information currently available to, management.

While the Company believes that its expectations are based upon reasonable assumptions, there can be no assurances that the Company's financial goals will be realized. Numerous factors (including risks and uncertainties) may affect the Company's actual results and may cause results to differ materially from those expressed in forward-looking statements made by or on behalf of the Company. Some of these factors include the acceptance of the Company's Internet strategy, the acceptance of new products and technologies related to SRS, the impact of competitive products and pricing, the timely development and release of media content by the Company, general business and economic conditions, particularly in Asia, and other risks detailed in the Company's Form 10-K and Form 10-Q statements filed with the SEC.

SOURCE: SRS Labs, Inc.