Gardena, CA - July 2, 2007 -
TMPG, Inc. (www.tmpg-inc.com), the company that makes digital video easy, is introducing a free update to its popular TMPGEnc 4.0 XPress video encoding software. The update provides a new input option for FLV (Flash Video), a file format used specifically for video streaming distribution found, among others, on YOUTUBE(R) and SMILEVIDEO(R) user generated content sites.

"Thanks to the partnership between TMPG Inc.'s parent company Pegasys Inc. and On2 Technologies, Inc., TMPGEnc 4.0 XPress now supports the common FLV1 format, but also the FLV4 format using the On2 VP6 CODEC. If we exclude little used formats, almost all FLV formats are now easily processed by TMPGEnc 4.0 XPress," stated Kimi Matsuki, CEO of TMPG Inc.

The update to TMPGEnc 4.0 XPress allows users to input files encoded in Adobe Flash(TM) format or FLV, increase the picture size, change the resolution, reduce video noise or insert subtitles. The users can output those files into DVD-Video or iPod compliant MPEG. Files can also be converted into DivX and uploaded to its Stage 6 user generated content site. These are a few of the many included applications that highlight the full potential of the updated TMPGEnc 4.0 XPress.

"We are pleased to work with Pegasys Inc. parent of TMPG Inc. to provide the On2 VP6 CODEC with their TMPGEnc 4.0 XPress Update. VP6 is used to create the Flash video files used by the leading Web2.0 sites, user generated content sites, and social networking sites," stated Bill Joll, CEO of On 2 Technologies Inc. "Flash is fast becoming the de-facto standard for Internet video, and this partnership continues that trend by allowing for the integration of files originally generated in Flash into alternate format based applications."

Flash Video (FLV) is a proprietary file format used to deliver video over the Internet using Adobe® Flash Player version 6, 7, 8, or 9. Flash Video content can also be embedded within SWF(swiff) files.

About TMPG, Inc.
TMPG, Inc. makes digital video easy. Headquartered in Gardena, California, the company was established early in 2003, built on a solid foundation of technology developed by its parent company, Pegasys Inc. The company's two flagship products, the TMPGEnc video encoder series and the new TMPGEnc DVD Author, anchor a strong line of retail and OEM digital video editing and encoding products for home and professional users.

The recognized leaders in developing quality video encoding tools for MPEG applications, TMPG Inc.'s encoding technology is also incorporated into numerous commercial and professional video editing and DVD-creation software products. Applications developed by its parent, PEGASYS, have been bundled with quality products from top worldwide manufacturers, including Sony Japan and Pioneer Australia. For more information about TMPG, Inc. and its products, visit the company's website at www.tmpg-inc.com.

About On2 Technologies, Inc.
On2 Technologies (Amex: ONT) is a leading technology firm at the forefront of digital video compression. The company revolutionized digital media delivery with the creation of its advanced full-motion, full-screen On2 Video compression and streaming technologies. On2 Video codecs are widely used in the Internet, video-on-demand, VoIP, and mobile media markets. On2's software is used by such leading global companies as Adobe, AOL, Brightcove, Videoegg, Skype, XM Satellite Radio, Move Networks, Sony, and Tencent. Located in Tarrytown, N.Y., the company has R&D offices in Clifton Park, N.Y., and Cambridge, UK. To contact On2, write to sales@on2.com or visit http://www.on2.com.