SRS Named Most Widely Employed Enhanced Stereo Process in The World; New Audio Chip Market Report Ranks SRS Labs Number One Consumer Audio Enhancement Vendor

Business Wire, Sept 13, 2006

LOS ANGELES -- SRS Labs, Inc. (NASDAQ:SRSL), the leading provider of surround sound, audio enhancement and voice technologies, today announced its audio enhancement technologies are the most widely employed enhanced stereo process in the world. The June 2006 Forward Concepts research report titled "2005 Audio Chip Markets: The Foundation of Multimedia" report concluded this and has also ranked SRS Labs as the number one audio post-processing enhancement product supplier based on revenue.

E[acute accent]The Forward Concepts report states, "SRS Labs processing techniques have a number of virtues that seem likely to recommend them in the marketplace for some time to come. They are relatively simple and straightforward, require little processing power in digital implementations, and produce fairly consistent effects across a range of transducers." "SRS pioneered stereo audio enhancements for consumer electronics products and thus has extensive experience in the application of post processing in challenging audio product designs including flat panel TVs, car head units, MP3 players and mobile phones," said Will Strauss, president of Forward Concepts and editor and contributor of the "Audio Chip Markets" report. "As a result, SRS has been quite successful in attracting the world's leading product makers as licensees and has become the most widely employed enhanced stereo process provider in the world." E[acute accent]SRS WOW, SRS Labs' leading stereo and bass enhancement technology, has shipped in over 1 billion products including Microsoft's Windows Media Players, flat panel TVs, AV receivers, MP3 players, notebook PCs, car audio head units and iPod speaker cradles. In mobile phones alone, SRS WOW has shipped in more than 16 million handsets, a fact often overlooked by the industry because SRS Labs' mobile phone licensees have strict confidentiality requirements as they are among the world's leading handset makers. SRS WOW's popularity began with its initial use in Microsoft's Windows Media Player 7 in the year 2000. Today the technology is used by consumer product and mobile phone handset makers to help tune the audio quality of the product by compensating for the small speakers, tiny earbud headphones and compact handset designs. The technology is easy-to-implement and requires minimal processing power and memory - a key deciding factor for low-power product designs. E[acute accent]"We are extremely proud of this landmark achievement and are pleased that over the past several years we've been able to supplement the growth of our traditional home entertainment licensing business by adding revenue streams from the PC, MP3 player, automotive and mobile phone market," said Tom Yuen, chairman and CEO at SRS Labs. "Our success in delivering superior audio enhancements to the television, MP3 player and mobile phone markets has placed us in a unique position to fully understand and deliver solutions for the growing mobile phone and mobile TV markets." E[acute accent]Expanding upon the success of the SRS Labs licensing business in TVs, MP3 players and other product markets, SRS Labs has also developed a unique driver level audio enhancement solution and control panel for Microsoft's Windows Mobile handsets. SRS WOW HD(TM) is the newest member of the WOW technology family and provides additional controls to help tune the sound quality of the handsets for music, video, mobile TV and gaming. SRS Labs and Microsoft announced an advanced version of this driver-level solution called SRS Mobile HD(TM) at the Spring CTIA show. In addition to SRS WOW HD for stereo enhancement, Mobile HD includes the new SRS Headphone 360(TM) virtual surround headphone for mobile TV and mobile video services. SRS Mobile HD takes surround encoded content and accurately represents a virtual 5.1 speaker system over any standard earbud or headphone using minimal processing power and does not require delay or reverb. E[acute accent]The SRS WOW family of audio enhancement technologies has been licensed to leading consumer electronics, chip and handset companies worldwide. Customers who develop and purchase SRS Labs licensed solutions for the mobile phone market include, but are not limited to, Amoi, Fangtek, NEC, Samsung and Sharp, with handsets marketed in Japan, China, Hong Kong, UK, Korea, Italy, Australia and the United States on leading networks including Verizon, TMobile, Sprint, NTT DoCoMo, Vodaphone, SK Telecom and Hutchinson's "3" network. E[acute accent]SRS Labs will be demonstrating its newest audio technologies for the mobile phone market at CTIA Wireless IT & Entertainment Conference, September 12-14, 2006 in Los Angeles, CA (Booth 746-I in the MTertainment Pavilion.) Demonstrations will include SRS Headphone 360 which provides a personal 5.1 surround sound over headphones for mobile phones and SRS WOW HD which builds on the unprecedented success of SRS WOW and SRS WOW XT. SRS WOW HD delivers a new Definition(TM) control for high frequency sparkle and realistic clarity and the new center control for dynamic extraction and positioning of dialog with respect to the 3D space control. Combined as a single audio solution for the mobile market, these technologies can be implemented together in a device and marketed as a "total solution" called SRS Mobile HD. This solution enables handset makers and carriers the ability to deliver immersive, surround sound for the exploding mobile TV market while continuing to deliver superior sound for music services.