Semico Research Predicts ''Age of Configurability''; Configurable Cores to Outpace Growth of Fixed Architecture CPUs by 5 to 1

ELSTREE, England -- February 1, 2006 – ARC International (LSE: ARK) today announced that Semico Research Corporation has released a new market report on configurable 32-bit CPUs. Semico, a leading semiconductor analyst and research company based in Arizona, has concluded that system-on-chips (SoCs) incorporating one or more configurable 32-bit processors will grow at a compound annual growth rate (CAGR) of 45.9% between 2003 and 2009, far outpacing the projected increase of less than 10% for chips with fixed architecture 32-bit cores. According to Tony Massimini and Richard Wawrzyniak, the Semico analysts who authored the study, protection from piracy and cloning and the ability to develop highly optimized chips are primary reasons for the rapid adoption of configurability.

“One of the realities of the high tech market is reverse engineering,” said Massimini, chief of technology at Semico Research. “Companies need to protect their life blood, namely their intellectual property.” Mr. Massimini will present more details about the fundamental shift toward using configurability for SoC design at ConfigCon™ Taiwan 2006, which will be held February 23 in Hsinchu Taiwan.

More details on the Semico report can be found at www.semico.com.

Further information on ConfigCon is available at www.configcon.com.

“At the dawn of the 21st century, it’s clear that the global semiconductor market is undergoing a paradigm shift in design methodology,” said Carl Schlachte, president and CEO at ARC International. “OEMs and semiconductor companies are rapidly moving away from using one-size-fits-all IP toward a solution that better enables their success, not that of their third party suppliers. Semico’s report underscores this trend, which ARC sees unfolding on a daily basis.”

ARC International is the world leader in low-power, high-performance 32-bit configurable CPU/DSP processor cores, subsystems, real-time operating systems and development tools for embedded system design. ARC’s patented configurable CPU technology assists customers in the development of next generation digital media, consumer and communications devices, resulting in lower cost, higher performance SoC products.

ARC International maintains a worldwide presence with corporate offices in San Jose, California, USA and Elstree, UK. The company has research and development offices located in England and the United States. For more information please visit the ARC website at: www.ARC.com. ARC International is listed on the London Stock Exchange as ARC International plc (LSE: ARK).