AMSTERDAM, Netherlands, and CLIFTON PARK, New York, September 13 /PRNewswire/ --

- On2(R) video delivers over 50% bandwidth savings compared to leading
H.264 implementations

IBC -- On2 Technologies, Inc. (Amex: ONT), a leader in video compression
solutions, announced today the launch of its latest video compression format,
On2 VP8(TM). This eighth generation of On2 video is the perfect solution for
web TV, IPTV and video conferencing companies looking to differentiate their
product and service offerings by delivering higher quality video using less
data and requiring less system resource for playback.

Need for a More Efficient Video Compression Format is Clear

Downloading and streaming HD movies and TV shows has become commonplace,
and with affordable HD web cams, we will see rapid growth in high-resolution
user-generated content as well as the wide-scale adoption of high quality
video communication solutions.

Even with faster transport technologies on the way, the cost and
availability of bandwidth will remain a stubborn obstacle to containing costs
as video services use more bandwidth than any other IP application. According
to a recent white paper published by Cisco, annual IP traffic will exceed
half a zettabyte by 2012, with video accounting for close to 90% of all
consumer traffic. Internet video alone is expected to generate 10 exabytes of
data per month in 2012.

"Next generation video must transcend platforms while remaining fast and
affordable," said Eero Kaikkonen, Chief Marketing Officer at On2. "We design
On2 video formats to achieve those goals. On2 VP8 achieves significant
improvements over leading standards-based implementations and is less
compute-intensive to encode and play back. Furthermore, we have used our
years of experience developing embedded video IP to ensure the design is
entirely suited for optimization to current and future desktop and mobile
processor cores."

Over 40 Groundbreaking Innovations

On2 VP8 surpasses the compression efficiency and performance of every
other video format on the market by employing over 40 technical innovations,
among them:

-- Advanced prediction through constructed reference frames
    -- Macroblock row level threading
    -- Improved small area referential encoding
    -- Advanced contextual entropy coding without the added complexity of bit
       level adaptability
    -- Sparse targeted adaptive loop filtering



"With On2 VP8, we set out to increase compression performance over On2
VP7 and leading H.264 implementations by 20% while reducing playback
complexity by 40%," said Paul Wilkins, Chief Technology Officer at On2. "In
the end we exceeded these goals and even back-ported some of what we learned
to our On2 VP6(R) for Adobe(R) Flash(R) encoders."

On2 VP8 Surpasses H.264, VC-1, Real Video in Quality and Performance

With the introduction of On2 VP8, On2 Video now dramatically surpasses
the compression performance of all other commercially available formats. For
example, leading H.264 implementations require as much as twice the data to
deliver the same quality video as On2 VP8 (as measured in objective peak
signal to noise ratio (PSNR) testing).

In addition, the On2 VP8 bitstream requires fewer processing cycles to
decode, so users do not need to have the latest and greatest PC or mobile
device to enjoy On2 VP8 video quality.

"Through our relationship with On2 over the years, Move Networks has
enabled viewers to realize the highest quality Internet television experience
possible. We look forward to On2's continued innovations," said John Edwards,
CEO of Move Networks.

Future-Proofed for Multi-core

Multi-core processing is one of the most significant developments in
computer technology. On2 VP8 is designed to take full advantage of multi-core
systems and can efficiently use up to 64 processor cores simultaneously.

"As new multi-core processors come to market, On2 Video will be able to
make maximum use of the additional computing power available, " said Wilkins.
"Our innovative encoder can seamlessly use additional cores to either
increase compression speed or to improve compression quality in real-time
applications."

Designed with Mobile in Mind

On2 has worked closely with ARM to ensure suitability for porting to
current and future ARM single and multi-core processors in mobile devices.

"We have been working with On2 to ensure that their compression schemes
work as optimally as possible with our NEON(TM) 64/128-bit SIMD technology
which enables high definition video in software. NEON technology is a key
feature in our current Cortex(TM)-A8 and Cortex-A9 MPCore(TM) processors and
will be included in all future ARM application processors," said Laurence
Bryant, Mobile Segment Marketing Manager, ARM. "The high compression
performance of this latest generation of On2 Video suggests that it will be
ideal for wireless internet applications where available data bandwidth is a
premium, and complements our recent work with Adobe on the Open Screen
Project to drive consistent internet experiences across multiple screens,
including TVs, PCs, mobile devices and consumer electronics."

"JavaFX enables content authors and developers to quickly and easily
deliver high-impact, rich internet applications across mobile phones,
desktops, TVs and other consumer devices," said Param Singh, senior director
of JavaFX marketing at Sun Microsystems. "JavaFX leverages the best
capabilities of the existing Java platform along with new immersive media
capabilities and we are pleased to be working with On2, a world leader in
video compression technology. The combination of On2 video and JavaFX will
provide the high-fidelity video capabilities to supercharge the consumer
experience across the billions of devices around the world that are powered
by Java technology."

Company Remains Committed to Existing Formats

On2's VP6 format became the de facto standard for web video following its
integration in Adobe Flash Player in 2005. On2 expects VP8 to complement its
existing formats and, in particular, is fully committed to continuing the
development of VP6 to further improve encoding and playback performance.

"We are serving different needs with On2 VP6 and VP8," said Kaikkonen.
"On2 VP6 offers distinct advantages for web video as the Adobe Flash Player
is installed on nearly every desktop in the world. It offers comparable
quality to H.264 with the added value of supporting cue points and alpha
channel masking, allowing developers to quickly and easily create more
interactive and complete web video experiences with minimal investment. On2
VP8 will be our flagship format and enable companies developing client-side
playback capability to deliver a supreme video-over-IP solution."

Simple, Flexible Licensing

On2 video is proprietary to On2 Technologies and is available with
patent-pool free licensing, avoiding the burdensome royalties associated
with standards based formats.

For more information on On2 Video please visit www.on2.com

About On2 Technologies

On2 (Amex: ONT) creates advanced video compression technologies for
desktop and wireless. Powering the video in many of today's leading web and
mobile applications and devices, On2's technology is used by industry leading
companies including: Nokia, Infineon, Sun Microsystems, Mediatek, Sony,
Facebook, Brightcove, Move Networks, Adobe and Skype. On2 Technologies is
headquartered in Clifton Park, NY USA. For more information please visit
www.on2.com

Trademarks mentioned in this release are the property of their respective
owners.

Web site: http://www.on2.com