Tina Wilmott             Bobbi L. Keene
Creative Labs, Inc.      Copithorne & Bellows
twilmott@creaf.com       bobbi.keene@cbpr.com

Technology

Creative's ability to enter the Internet videophone market has greatly contributed to its success in developing video conferencing technology and standard-setting audio technology. For the past two years, Creative's ShareVision® PC3000 has delivered live two-way color video, voice and data communications over a regular telephone line at remarkable performance rates. Additionally, Creative's industry standard Sound Blaster® technology provides videophone applications with superior full-duplex audio capabilities, ensuring that users will experience the best audio and video telephony technology on the Internet.

Creative recently entered into a licensing and technology agreement with NetSpeak giving Creative the right to license NetSpeak technology under the Creative WebPhone™ brand. NetSpeak's flagship product, WebPhone®, is an award-winning, full-featured Internet telephone that works over the Internet and other TCP/IP-based networks. By integrating NetSpeak's Internet telephony software with Creative's advanced video conferencing and audio technology, Creative is poised to offer high-value videophone applications to the mass market in the very near future. (Please see separate news release dated September 24)

"NetSpeak's Internet telephony technology is vital in Creative's strategy to introduce multimedia communications solutions to the Internet," said Lung Yeh, vice president of Communications and Internet Division at Creative. "By integrating technologies and leveraging each company's widespread distribution channels, we expect to make significant inroads in the Internet videophone market and dramatically increase awareness and usage of these types of products."

Distribution

Creative's ability to bring high-value multimedia products to market is due in part to its extensive distribution network. More than 35,000 retail outlets carry Creative's products and the company maintains tremendous reseller and OEM relationships around the globe. By bundling videophone technology with its wide array of products, Creative has the ability to put advanced video and audio communications solutions in the hands of every new customer.

"This is just the first step in the type of integrated technology NetSpeak and Creative are capable of developing and providing," said Robert Kennedy, president and chief operating officer of NetSpeak Corp. "By leveraging our collective technological expertise with NetSpeak's commercial relationships and Creative's leadership in the retail channel, we can dramatically increase the usage of videophone technology on the Internet. -- We want to see this new technology utilized on as many corporate workstations and home PCs as possible."

NetSpeak maintains a long list of commercial relationships that include alliances with: Motorola, Inc.; Rockwell International Corp.; InfoSpace, Inc.; and Durant Communications Network, Inc., just to name a few. As a result of these relationships, NetSpeak has successfully distributed its technology in the form of Intranet solutions that operate on TCP/IP-based networks. As a result, Creative's Internet videophone technology is also uniquely positioned to be distributed and used in worldwide commercial markets.

Creative Technology Ltd. is the world's leading provider of advanced multimedia solutions for personal computers, including sound, graphics, communications and video conferencing products. The company's Sound Blaster technology has been accepted as the worldwide standard sound platform for PCs, and the company's global distribution network is the most extensive in the multimedia industry. Creative is focused on enhancing the overall user experience by providing powerful, enabling, high-value technology for the mass market.

This announcement relates to products whose launch are in the United States of America. The product names, contents, prices and availability may differ elsewhere in the world according to local factors and requirements.

Sound Blaster and Blaster are registered trademarks of Creative Technology Ltd. E-mu is a registered trademark of E-mu Systems, Inc. All other products mentioned herein are trademarks of their respective owners and are hereby recognized as such.