ASUS Licenses On2 VP7 Video Codec for Skype Videophones

- On2 Technologies (NYSE Amex: ONT) announced today that ASUS, a leading provider of digital home solutions and Internet devices, has licensed the On2 VP7 video format & encoder/decoder software SDK to develop Skype-enabled videophones.

On2 VP7 is the video format used in Skype, which millions of people use every day to communicate with others around the world. Skype calls with video are gaining in popularity and account for over 25% of all Skype calls.

Under the agreement, ASUS has a multi-year license to develop and market Skype phones featuring On2 VP7 video, including the Eee Videophone AiGuru SV1. The Eee Videophone was an earlier collaboration of the two companies and was the first videophone to be Skype Certified.

ASUS videophones enable people to make and receive free voice and video calls to any Skype user without requiring a computer. Its simple-to-use, icon-based interface and intuitive button layout take the complexity out of Internet calling - making it easy for anyone to make and receive Skype-to-Skype video and voice calls. Users can even join voice conferences, making the Eee Videophone an inexpensive, all-in-one voice and video conferencing solution for small businesses. Furthermore, the Eee Videophone also allows users to make and receive calls to and from fixed and mobile lines at very low rates.

'In the past six months we've shown the Eee Videophone with VP7 video at trade shows & other meetings around the world,' said Matt Frost, interim CEO and COO at On2 Technologies. 'People everywhere simply love this device. They are captivated by its ease of use and video quality. ASUS did a remarkable job integrating VP7 into the Eee Videophone and we look forward to seeing more Skype-enabled devices from them in the future.'

'Video quality and smooth streaming are central to the appeal of the Eee Videophone. On2 VP7 enables us to deliver a product that creates a rich experience for Skype users,' said Ellis Wang, Deputy Director, EPC Business Unit, Portable Media Box Product Planning & Management Department at ASUS. 'We expect a growing market for dedicated video-calling devices, and On2 provides us with a robust codec platform on which to build devices that consumers want for reliable video communication.'

About On2 Technologies
On2 (NYSE Amex: ONT) creates advanced video compression technologies that power the video in today's leading desktop and mobile applications and devices. On2 customers include Adobe, Skype, Nokia, Infineon, Sun Microsystems, Mediatek, Sony, Brightcove, and Move Networks. On2 Technologies is headquartered in Clifton Park, NY USA. For more information visit www.on2.com.

About ASUS
ASUS is a leading company in the new digital era. With a global staff of more than eight thousand and a world-class R&D design team, the company's revenue in 2007 was 6.9 billion U.S. dollars. ASUS ranks among the top 10 IT companies in BusinessWeek's 'InfoTech 100,' and has been on the listing for 11 consecutive years.