SRS TruSurround XT(R) Virtual Surround Sound Technology Used by STMicroelectronics in New STi7710 DVR and HDTV Set-Top Box Solution

SANTA ANA, Calif., Sept. 22 /PRNewswire-FirstCall/ -- SRS Labs, Inc. , a renowned provider of audio, voice and surround sound technologies, today announced that STMicroelectronics has bundled SRS TruSurround XT(R) ("TS XT") into its newest and most technologically advanced semiconductor solution for set-top box applications. The new STi7710 high definition STB decoder combines the features of ST's very successful STi7020 and STi5517 devices with additional features that include high-speed USB capabilities, an HDCP processor, SRS TruSurround XT virtual surround sound with bass enhancement and increased security capabilities for content providers. The new STi7710 chip will be available in production volumes to set-top box manufacturers worldwide in Q1 2005 and will join the successful STi55XX series as a state-of-the-art solution for global set-top box manufacturers.

SRS TruSurround XT is the established standard for the virtualization of 5.1 surround sound over two-speaker systems. It creates an immersive and powerful surround sound experience over two speakers from any stereo, two-channel encoded, and multichannel encoded material. TS XT is the ideal solution for set-top box customers because it creates a thrilling surround sound experience over two speakers from any mono, stereo, encoded two-channel or multichannel source. TS XT also includes two proprietary technologies that make it the industry's most feature-rich virtual surround sound technology available -- SRS TruBass(R), which provides deep, rich bass enhancement regardless of speaker size, and SRS Dialog Clarity(TM), which clarifies speech during passages that contain dynamic surround sound effects.

"We are delighted to further our relationship with SRS with the inclusion of TruSurround XT within the STi7710," said Armando Caltabiano, General Manager of the Retail Products Division within ST's Home Entertainment Group. "Technology such as this is an important differentiator for our customers, particularly within the free to air market."

"The new STi7710 is the latest TruSurround XT implementation available to set-top box manufacturers from ST," said Lenka Koloma, director of strategic IC partner development for SRS Labs. "We are very happy to have the world's most popular virtual surround sound technology featured on this state-of-art SOC with its large potential to reach the biggest manufacturers and operators and we look forward to its success."

The leader in the global set-top box market(1), ST solutions are addressing the growing market demand for converging products, specifically the continuing trend toward the integration of hard disk drives, USB technology, DVD and MP3 functionality. The new STi7710 device is looking ahead toward the HDTV markets and the opportunities it presents by being able to offer so many features and do it at a reduced cost to manufacturers. Large markets such as the US, Asia and Australia that embrace new technologies including HDTV, multichannel audio and device convergence, help drive the demand in emerging markets like Europe.

For information regarding SRS Labs' technologies, contact Lenka Koloma at [phone] Ext. 3020 or [e-mail]. Additional information is also available from the company's website at http://www.srslabs.com/.

About SRS Labs Inc.

SRS Labs is a recognized leader in the advancement of audio and voice technology. The company works with the world's top manufacturers to provide a richer entertainment experience through patented sound techniques. SRS Labs' technologies can be heard through products ranging from televisions, flat panel displays, DVD players, mobile phones, car audio systems, headphones and notebook and desktop computers. The company also offers hardware and software tools to professionals and consumers for the creation, production and broadcast of content featuring SRS Labs' technologies. SRS Labs' wholly owned subsidiary, ValenceTech, is a Hong Kong-based semiconductor company that designs and sells custom ASICs and standard ICs to leading manufacturers worldwide. Based in Santa Ana, Calif., the company also has licensing representation in Hong Kong, Japan, Europe, and Korea. For more information about SRS Labs, Inc. please visit http://www.srslabs.com/. The information on the aforementioned website is not incorporated by reference into this press release.

Except for historical information contained in this release, statements in this release, including those by Ms. Koloma in paragraph four, are forward-looking statements and projections (which include statements concerning plans and objectives of management for future operations) that are based on management's belief, as well as assumptions made by, and information currently available to, management. While the Company believes that its expectations are based upon reasonable assumptions, there can be no assurances that the Company's goals and strategy will be realized. Numerous factors, including risks and uncertainties, may affect the Company's actual results and may cause results to differ materially from those expressed in forward-looking statements made by or on behalf of the Company. Some of these factors include the acceptance of new SRS Labs' products and technologies, the impact of competitive products and pricing, the timely development and release of technologies by the Company, general business and economic conditions, especially in Asia, and other factors detailed in the Company's Form 10-K and other periodic reports filed with the SEC. SRS Labs specifically disclaims any obligation to update or revise any forward-looking statement whether as a result of new information, future developments or otherwise.

(1) In-Stat/MDR - MPEG Video ICs: The Promise of MPEG-4 - June 2004 (Report Number: IN0401230MI)

For further information, please contact: Investors, Tami Yanito, ext. 3093, [e-mail], or Media, Jennifer Drescher, ext. 5010, [e-mail], both of SRS Labs, Inc., [phone].

SRS Labs, Inc.