Evolution of Home Networks – How did we get here?

1. Delivering cost-effective solutions for transmitting broadcast quality video over wired and wireless IP networks

2. Evolution of Home Networks – How did we get here? • Broadband data • Growth of IP based entertainment • Growth of home networks (802.11) • Digital Content – (satellite, digital cable, PVR, etc…) • IP networks – develop as most pervasive and least expensive transport for content • Desire to make content available on all devices from oneGateway or Set Top Box • Growth of multiple devices all vying to be center of entertainment (home gateway, STB, PC, game consoles) • Flat Panel, LCD, Plasma TV’s – hungry for content “We are convinced that wireless is what will drive home networking into the mass market. And the real trigger, is going to be entertainment because that is what people want at home” michael greeson, senior analyst park associates

3. ViXS component and software solution delivers a true Quality of Service video networking platform HDTV 19 mbps guaranteed SDTV SDTV 6 mbps avg. ViXS Enabled Gateway 12 mbps peak 6 mbps avg. ViXS is delivering multi-steam, Broadcast Quality Video over IP – wired or wireless - which is the key to Mass Market adoption of home networks, 802.11, multi-media gateways, and additional service offerings from MSOs The next big market opportunity will be the hub of the home network: Currently, ViXS is the only company with a solution that manages the video to effectively deliver guaranteed QoS video over local IP networks. ViXS is agnostic to network topology and completely standards based.

4. ViXS corporate overview • Founded January 2001 • Headquartered in Toronto, Ontario • US development center (Austin, Tx) • 75 employees • Unique combination of engineering competencies in semiconductor design and software development for digital multimedia and advanced digital communications • Alumni of ATI, Pixstream/Cisco, Motorola, Level-One/Intel,Scientific-Atlanta, Sigma-Tel • First Production Ready Silicon delivered to customers 18 months fromfounding of company • Second communications IC demonstrated January 2003 at CES • Design wins/revenue recognized in 2002 First company to deliver QoS solution for video distribution over local IP networks – The Missing Link

5. market segments for ViXS` MSO/STB head end infrastructure 8.6 M 4th Generation STBs deployed by 2007 US Households2 • Digital Cable and Satellite Set-Top-Boxes PC WLAN 30M PC based entertainment networks by 20071 • PC Media Gateway • HP Media center • MS Ehome, Longhorn 140M IC’s shipping annually world wide by 20073 • Home networking • Hotspots • Enterprise (hospitals, hotels, MDU) vixs markets Consumer Electronics 152M Network capable CE platforms by 20071 • DVD – RW • Analogue media gateway • PVR • High-End display media gateway Gaming Machines • 27M Home Gateways in 2004; 51% distributing video content (Cahners Instat) • 802.11 33 million in 2006 – (In-Stat/MDR) • 350% year over year growth in WLAN • 150% year over year in LCD displays 3- Allied Business Intelligence, Wi-Fi Integrated Circuits, 2002 1-source: Parks Associates, “Networks in the Home, 4th ed.” 2003 2- Parks Associates, “Next Gen. STBs” 2002

6. the basic challenge • Reliable video over IP is very hard: • QoS and network variability a major challenge • IP networks are inherently unreliable, with changing bandwidths, traffic, etc • Video streams have very high bit rates and are highly sensitive to changes in available bandwidth • Wide range of display devices • Wireless is even more challenging – issues of distance & interference • Content protection • Traditional solution: • Video is typically distributed via dedicated (cable and satellite) broadcast networks that are expensive to build and maintain • Installation is expensive (multiple STBs and wiring throughout) • Video and data are not converged • No networking or sharing of resources (storage, DVDs, etc…)

7. ViXS solution keys to delivering video over ip: • ViXS takes a fundamentally different approach: • Redefine QoS in terms of what matters to video:frames per second • ViXS guarantees delivery of video frames by • Transrating and transcoding of video streams in real-time • Measuring and monitoring the network bandwidth • Maintain content security and provide encryption • Transmission of multiple streams (wired or wireless)with guaranteed QoS • Flexibility to easily support new and legacy devices on the video network • Standards compliant: regardless of physical layer/network topology & Support all video standards with flexibility to support emerging standards • ViXS provides the only robust, cost-effective solution for transmitting broadcast-quality video through IP-based wiredand wireless networks with guaranteed video QoS – regardless of physical layer/network topology

8. delivering reliable video over wireless networks

9. delivering reliable video over wireless networks • Available bandwidth fluctuates • Video rates have peaks • More bandwidth is unlikely

10. delivering reliable video over wireless networks • Monitor bandwidth availability

11. delivering reliable video over wireless networks • VIXS transrates and transcodes • Guarantees 30FPS • QoS is tied to FPS, not bandwidth

12. delivering reliable video over wireless networks • Multiple streams multiply data peaks • VIXS intelligently re-aligns data peaks

13. delivering reliable video over wireless networks • Up to 8 streams • VIXS adapts to each stream • Wireline or wireless

14. MATRIX & XCODE: The ViXS Wireless multi-stream solution ViXS solution video gateway video client Matrix XCode Videoprocessing Wirelessnetwork Wirelessnetwork Videoprocessing • Video QoS Using industry standard technologies - MPEG and 802.11 • Matrix IC Focused on the Gateway with standard HW for the clients • Two 802.11 channels for management of multiple video clients • solves near / far problem, enabling multi-client support even with far video clients • Max ratio receive diversity for increased receiver sensitivity. Bigger ears in the gateway enable high performance with low-cost standard 802.11a clients • Combination of ability to provide maximum radio coverage and sensitivity and ability control video bit-rate ensures uninterrupted video transmission. Transportstream Standard 802.11

15. myths and facts about competition in video over ip myths facts • Video over IP networks is a matter of getting enough bandwidth • Wireless QoS standards such as 802.11e will be the enabler for video over WLAN • Only a proprietary transport solution will be successful • Next generation compression technologies will solve the problem • UWB • Constant bit rate full encode/decode Even wired 100Base-T IP networks congest. Wireless is worse. Increasing bandwidth will not enable reliable video transmission Wireless networks cannot control the available bandwidth or environment in which they operate. Traditional QoS cannot guarantee sufficient bandwidth for video ViXS can distribute multiple video streams over standard 802.11 (b,a,e,g) Compression will reduce the bit rate, but will not resolve fluctuating bandwidth challenges Unproven, not interoperable, range issues, regulatory challenge, US only Poor quality, cost, single stream ViXS is enabling and complimentary to other networking technologies Video requires 30frames per second,not 50 or 100Mbps! You don’t need massive bandwidth! OR

16. ViXS Current Product Offering adaptive bandwidth footprint management (abfm)intelligent distributed video (idv) • IP Network Monitoring/Management Software:Closed-loop dynamic network management software constantly monitors network and determines available bandwidth for video processing • Maintain QoS of video regardless of network impairments • Shared PVR solution for video delivery to any PDA,Webpad, PC and TV Xcode – dynamic multi-stream transrater /transcoder • Video network processor • Video stream acquisition, decryption, bit-rate andformat grooming • IP encapsulation and re-encryption for up to 8 MPEG transport inputs • Provides explicit real-time management of video rates and formats on frame-by-frame basis

17. ViXS products (cont’d) matrix • 802.11a integrated PHY/MAC wireless chip focused on quality of service (QoS) for video, ensuring delivery of30 frames-per-second for each video stream. Systemis optimized for superior video delivery rate, rangeand quality Over 50 patents filed in the US

18. Market Opportunity for Video Area Networking represents enormous growth within 5 years Figures Represents CE & PC annual numbers for multimedia, network capable PCs, and/or network Enabled CE devices in the US market.

19. Consumer Adoption will be very strongThe Market is Ready Now

20. Networked Entertainment to be Biggest Driver of Networked Home over Next 5 Years “Media networking, while accounting for just 6% of the market in 2002, will make up 49% of the revenues for total home networking by the end of 2007….as the market grows from $1.8 billion in 2002 to $5.3 billion in 2007” In-Stat/MDR Digital Domicile 2003

21. manage the video By Managing the Video, not the Bandwidth Pipe, ViXS is Changing the Market Opportunity for Video Distribution We look forward to telling you more about ViXS,our Partners, and team.