Magnolia Broadband Successfully Completes Field Trials of Mobile Transmit Diversity Technology With SK Telecom

Magnolia Broadband, Inc., (portfolio member of Silverstar Holdings) (NASDAQ: SSTR) a fabless semiconductor company and innovator of antenna diversity radio frequency (RF) solutions for the wireless industry, announced today that they have successfully completed field trials of Magnolia's Mobile Transmit Diversity solution, DiversityPlus(TM), with SK Telecom (NYSE: SKM), Korea's leading wireless telecommunications services provider. For the first time, the test results showed similar performance gains in commercially designed handsets as previously experienced in test platforms. As seen in this and prior tests conducted by SK Telecom, mobile transmit gains of 4 to 5 dB's have shown to significantly improve capacity, coverage and data throughput in commercial cdma2000 1xEVDO networks. The test also indicates that by deploying Magnolia's technology, network operators can significantly save on capital and operating expenses.

The field testing, which took place the week of July 18th in Seoul, was attended by more than 70 wireless industry leaders including other telecom carriers, handset OEMs, UMTS and WiMax base band chip providers. This test was a major interim milestone to SKT and Magnolia's road of offering handsets in 2006.

The commercial deployment of Magnolia's DiversityPlus chips in dual antenna cell phones will enable wireless carriers to significantly serve more subscribers within the same wireless infrastructure, eliminating the need for additional cell towers, while boosting coverage, data throughput and battery life. Additional benefits for carriers and consumers will be improved quality of service, include more reliable connections, fewer "dead zones," improved quality of service and a substantial lowering in the amount of energy cell phones emit.

"We are very pleased with the results of the field testing with Magnolia's Mobile Transmit Diversity technology and we will continue to work with them closely so that we can realize the significant benefits in our network," said Dr. Myung Sung Lee, Chief Technology Officer and Executive Vice President of SK Telecom.

"The successful results of the tests demonstrate that our innovative diversity technology will be a leading solution for enhancing CDMA-based networks in the Korean and other global marketplaces," said Osmo Hautanen, CEO of Magnolia Broadband. "We are now looking forward to offering our solutions to other protocols such as UMTS and WiMax."

DiversityPlus(TM) is a family of RF chipset products designed around Magnolia's unique algorithms for CDMA, UMTS and WiMax mobile terminals. By combining transmit and receive RF signals from two antennas in a unique way, the wireless operators increase their network capacity and significantly improve coverage and data rates to the individual subscriber. Simulations have shown that Magnolia expects comparable performance gains in both UMTS and WiMax.

About SK Telecom

Established in 1984 as Korea Mobile Telecommunications Service Co. and renamed in 1997, SK Telecom Co., Ltd. is Korea's leading information and communications company and a rapidly emerging player in the global telecom industry. SK Telecom merged with Shinsaegi Telecom in January 2002 and the subscriber base is now more than 19 million. In January 1996, the company launched the world's first commercial CDMA cellular phone service in Korea. In October 2000, SK Telecom introduced the world's first cdma2000 commercial service in Korea and has expanded that service to 81 major cities as of August 2001. Already this service is able to provide 153.6 Kbps high-speed data service and support various multimedia contents. In June 2001, SK Telecom began the world's first commercial service that offers motion pictures through a wireless handset without the need for peripheral devices, taking its cdma2000 1x network to a new level of usage. In January 2002, SK Telecom opened up a new year of mobile communication by providing the world's first synchronized commercial IMT-2000 (cdma2000 1xEVDO) Service in Incheon City on January 28, 2002.

About Magnolia Broadband

Magnolia is an innovative developer of semiconductors for the wireless industry and the first company to provide mobile transmit diversity antenna technology, DiversityPlus(TM) using a unique RF (Radio Frequency) chipset. With DiversityPlus(TM) technology, wireless carriers are able to increase up to twice as many subscribers within the same wireless infrastructure while boosting phone coverage, data rates and battery performance without any changes to their infrastructure or related wireless air interface standards.

DiversityPlus(TM) technology benefits all wireless protocols and is currently being commercialized for CDMA2000, UMTS/WCDMA and WiMax standards. Since its inception in 2001, Magnolia has raised more than $30 million in capital from notable investors, which include Draper Fisher Jurvetson Gotham, ECentury Capital Partners, Intel Capital, SCP Private Equity Partners, Selway Partners and Silverstar Holdings. Magnolia has filed numerous patents related to its core technology. For more information, go to www.magnoliabroadband.com.