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Breakthrough Interactive Music Technology Adds 3D-Animated Visual Enhancement to Internet Music

NEW YORK - August 9, 1999 - Creative Technology Ltd. (NASDAQ: CREAF), the leading provider of multimedia solutions for personal entertainment, today launched its latest groundbreaking interactive music technology, LAVA! (Live Audio Visual Animation), at the Interactive Music Expo (IMX) in New York. LAVA! first debuted last month at the nightly Woodstock '99 raves and on the Emerging Artist stage behind artists that included George Clinton and Moby.

For the first time, LAVA! makes it possible for Internet music such as MP3 songs to be accompanied by a complete customized 3D-animation containing images including interactive band logos, album art and band members' photographs to form a high-quality 3D video collage rendered in real-time, requiring little additional bandwidth. A LAVA! sequence takes up less than 100KB in disk space, considerably less than music videos generated from other software applications. Using a combination of sophisticated audio analysis and hardware accelerated graphics developed at the Creative-EMU Technology Center, LAVA! offers music enthusiasts a new way of experiencing Internet audio.

"By combining our expertise in high-end PC audio and 3D graphics acceleration to create LAVA!, we are delivering synergistic interactive music technology that creates a whole new category of Internet music entertainment. The Nomad MP3 player marked our entry into the MP3 revolution, and our introduction of LAVA! serves as an extension of our Internet music efforts," said Mike Barnes, Internet marketing manager for Creative Labs, Inc. "LAVA! not only adds a seamlessly integrated, visually compelling element to MP3 music, it gives musicians and record labels a revolutionary new way of promoting themselves and their music."

"The online music industry is booming. Artists, content providers and meta-labels are looking for new ways to enhance the Internet as a medium for online music publishing and entertainment. With LAVA!, we offer a powerful but easy-to use solution that will change the paradigm of how music is distributed, promoted and experienced," said Sim Wong Hoo, chairman and chief executive officer of Creative. "Besides our growing customer base of 40 million customers, LAVA! allows Creative to reach out to a wider online customer base that is hungry for Internet music and downloadable audio. We intend to continue working closely with industry partners and players to leverage new business and e-commerce opportunities."

Creative's LAVA! technology allows for the easy creation of interactive 3D visual scenes that react and respond to specific audio frequency bands in real-time, making it possible for an instant music video to be created. LAVA! gives visual expression to music and allows MP3 enthusiasts, musicians, and artists to express their creativity in visual terms; changing the Internet music experience from one where music only defines a listening experience, to one where the music actually manifests a complete, immersive and personalized visual experience.

Availability and LAVA! Information
In support of LAVA!, Creative is also launching LAVAmusic.com , the goal of which is to create an active online community interested in experiencing or publishing interactive LAVA! music videos for MP3 music. Additionally, Emusic.com and Epitonic.com plan to make LAVA! music available for download from www.emusic.com and www.epitonic.com in the near future (also announced today). In addition to experiencing LAVA! at IMX, owners of Creative Labs' popular Sound Blaster Live! sound card can now download LAVA! for free at www.LAVAmusic.com. Creative plans to make available a stand-alone, sound card independent, LAVA! player through LAVAmusic.com in mid-Fall 1999.

Developer Relations Support
Creative has a developer relations support group dedicated to the support of LAVA! This group will be responsible for promoting LAVA! as the premier authoring platform for meta-labels and content developers, and establishing LAVA! music-video-3D (MV3) files as a standard in the world of internet music.

This announcement relates to products whose launches 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, and LAVA! is a trademark, of Creative Technology Ltd. All other products mentioned herein are trademarks of their respective owners and are hereby recognized as such.

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