Fremont, CA - August 6, 1998 - Aureal Semiconductor Inc. (OTC:AURL) today announced availability of the new Vortex 2 PCI audio processor- the company's next generation solution for advanced audio features on personal computers. Vortex 2 is the only processor which provides dedicated processing power for A3D 2.0 positional 3D audio technology. Enabled by the high-bandwidth PCI-bus and the AC'97 CODEC specification, Vortex 2 is PC '98 compliant and more than doubles the performance characteristics of the original Vortex chip introduced one year ago. Aureal is sampling Vortex 2-based sound cards to its customers now.

Vortex 2 provides hardware support for Aureal's A3D technology - the standard for high-end 3D audio used in a multitude of PC games, as well as support for Microsoft's DirectSound3D. Aureal's recently announced A3D 2.0 provides additional 3D audio features, including Aureal Wavetracing Π-- the ability to add wall reflections and occlusions to model the acoustic characteristics of the environment. The Vortex 2 processor is configurable for up to 320 wavetable voices and accepts DLS 1.0 sound samples, making it an excellent platform for accelerating DirectMusic and MIDI-based audio.

Vortex 2 also includes a hardware-based graphic equalizer with ten bands per channel, providing stereo equalization with a 96dB signal-to-noise ratio. Custom crosstalk cancellation circuitry provides for highly effective A3D playback on stereo speakers as well as quad, 5.1, or 7.1 home theater speaker set-ups.

"Aureal has elevated PC audio in the past with their A3D technology, and now provides the next logical step with A3D 2.0 and the hardware to make it work - the Vortex 2," said Kip Kokinakis, CEO at Aureal Semiconductor. "With tons of support by the gaming community, this is the must-have audio platform for the future."

"Every one of the features of Vortex 2 was designed to be the best in its class," said Ken Wirt, Vice President of Corporate Marketing at Diamond Multimedia. "Combined together, we believe this is the best audio gaming and entertainment solution in the PC marketplace - bar none."

A3D Information:

Aureal A3D is a new audio technology that enables a real-life audio experience by surrounding the listener with sounds in all three dimensions using only a single pair of ordinary speakers or headphones. A3D was initially developed for NASA to create the ultimate audio simulation environment and is now used in over 100 games shipping or under development on the Microsoft Windows platform, including Unreal from Epic Megagames/GT Interactive, Incoming from Rage Software, Descent: Freespace from Interplay, Battlezone from Activision, and Jedi Knight from LucasArts. A3D is also supported by leading VRML browsers from Cosmo Software and Intervista Software.

A3D 2.0 Information

A3D 2.0 builds on the success of the original A3D and takes positional 3D audio to new heights. Designed to take full advantage of Aureal's Vortex 2 chip, A3D 2.0 is fully backward compatible with A3D while introducing a host of new features, including:

• Aureal Wavetracing Œ Technology: real-time acoustic reflections, reverb, and occlusion rendering.
• Vortex 2 Support: provides more 3D sources, 48kHz sample rate, larger HRTF filters.
• A2D: host CPU-based A3D emulation mode for non hardware-accelerated PCs.
• A3D API: a complete interface to support A2D, A3D, A3D 2.0 and DS3D rendering features

Vortex 2 Information

Vortex employs a unique audio dataflow architecture developed by Aureal which offers significant advantages over other PCI audio devices, most of which are either based on large, programmable DSPs, or fixed topology architectures which lack the programmability needed for flexible audio stream routing. Vortex offers the cost-savings and concurrency advantages of functionally optimized silicon, while maintaining the processing and audio streaming flexibility that is required for audio architectures such as Microsoft's DirectSound and upcoming Windows Driver Model (WDM).

The Vortex 2 (Part No. AU8830) is a 3.3 Volt, 5 Volt Compatible chip that is available in a 128-pin plastic quad flatpack design (PQFP). Key features of the part include:

• Hardware-based A3D and DirectSound3D engine (16 sources)
• Hardware-based A3D 2.0 Wavetracing engine with wall reflections and occlusions (64 sources)
• 320-voice DLS wavetable engine for DirectMusic and MIDI (64 hardware, up to 256 software voices depending on CPU)
• Hardware DirectSound engine (96 sources)
• Optimized for headphone, 2-speaker, or multi-speaker (up to 8) playback
• Hardware-based 10-band stereo graphics equalizer (96 dB Signal to Noise Ratio)
• Legacy audio support in real-time DOS and DOS boxes
• Hardware-based crosstalk cancellation
• 96 DMA channels
• Windows 98/95 and NT 4.0 Drivers (WDM ready)
• Full MIDI I/O and DirectX gameport acceleration
• SP/DIF output

About Aureal

Aureal builds advanced audio solutions including semiconductors, audio cards, and software that increase functionality and features for personal computers and consumer electronics devices. Aureal develops audio processing semiconductor chips and also licenses technology designed to define and improve advanced audio standards in the marketplace.

For information on Aureal, its products, and its industry leading A3D audio technologies, please call Corporate Communications at 510-252-4582 or visit our Website at www.aureal.com

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. Investors are cautioned that such forward-looking statements involve risk and uncertainties, including, but not limited to, dependence on the PC and consumer electronics industries and on product lines based on new technologies; foundry capacity, availability and reliability; competition and pricing pressures; and other risks detailed from time to time in the company's periodic reports filed with the Securities and Exchange Commission.