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Since the third quarter of 1998, Aureal has shipped in excess of 300,000 fully functional audio add-in products, based on Aureal's powerful Vortex® line of audio processors, to its board and retail distribution partners. Now, through AP3, Aureal will provide its award-winning digital audio imaging products to systems integrator customers at reasonable prices and with unsurpassed engineering support.

The company's products will continue to be available through Aureal's OEM partners -- such as Compaq Computer Corporation, Dell Computer Corporation, and Sony Electronics -- and retail distribution partners -- such as Diamond Multimedia Systems, Voyetra Turtle Beach, TerraTec Electronic GmbH, and Xitel Pty.

``As add-in components become more complex, the shift to direct manufacturer-to-integrator relationships becomes increasingly attractive,'' said Sean Kaldor, International Data Corporation's Vice President responsible for quarterly PC research. ``Systems integrators are seeking relationships that provide service and support, and vendors that can leverage that trend will be in high demand.''

``This new program from Aureal makes sense from the cost, quality, and support points of view -- and it's an astute business move on the part of Aureal,'' said Charles DiLisio, President of D-Side Advisors. ``The ability to leverage Aureal's high-performance audio products will allow systems integrators to better differentiate their products amid increasing competition from top-tier retail and build-to-order manufacturers.''

There has been a huge and very positive response to the efforts of Aureal and our many worldwide partners,`` said Kip Kokinakis, Aureal's President and CEO. ''Now, we're looking to expand our business model even further to incorporate the large systems integrator market.``

About AP3

Initially, three products will be available through AP3 when it launches in February:

* Vortex2 SuperQuad Digital PCI(TM) -- Aureal's flagship product is a complete accelerated PCI audio solution featuring the Aureal Vortex2 8830 audio processor and A3D(TM) 2.0 positional audio technology with Aureal Wavetracing(TM). Additionally, the card has digital audio outputs for up to four speakers and features an S/PDIF digital audio out port.

* Vortex2 PCI(TM) -- A complete accelerated PCI audio solution featuring the Aureal Vortex2 8830 audio processor and A3D 2.0 positional audio technology with Aureal Wavetracing.

* Vortex1 PCI(TM) -- A complete accelerated PCI audio solution featuring the Aureal Vortex® 8820 audio processor and A3D positional audio technology.

For more information on AP3, please send e-mail to ap3@aureal.com or visit Aureal's Website at www.aureal.com/ap3

Systems integrators may also contact the following representatives for their regions:

* Asia/Pacific: Joe Li, Hong Kong, 852-2301-1131

* North & South America: Richard Salazar, Fremont, CA, 510-252-4288

* Europe: Roy Taylor (3DSL), United Kingdom, 44-1604-859333.

About Aureal Semiconductor

Aureal is a leading provider of advanced audio solutions for the computer, consumer, entertainment and professional audio markets. The company designs, builds and distributes advanced audio semiconductor and software solutions for personal computers and consumer electronics devices through the OEM, integrator/reseller/VAR and direct-to-customer channels. Aureal also licenses technology designed to define and improve advanced audio standards in the marketplace.

Aureal's award-winning product line includes A3D positional audio technology, Vortex audio processors and Vortex-based sound cards, and A3D Pro sound design software. For information on Aureal Semiconductor or its products and industry-leading audio technologies, please contact our Public Relations department (510-252-4326) or Investor Relations department (510-252-4582). You may also visit our Websites at www.aureal.com and www.a3d.com.

Forward-Looking Statements

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. Investors are cautioned that such forward-looking statements involve risk and uncertainties, including, but not limited to, dependence on the PC and consumer electronics industries and on product lines based on new technologies; foundry capacity, availability and reliability; competition and pricing pressures; and other risks detailed from time to time in the company's periodic reports filed with the Securities and Exchange Commission.

NOTE: Aureal, the Aureal logo, A3D and Aureal Wavetracing are trademarks, and Vortex is a registered trademark of Aureal Semiconductor Inc. Other names may be trademarks of their respective owners.

SOURCE: Aureal Semiconductor, Inc.