TranSwitch Corporation Announces the First Licensing of Its DisplayPort Transceiver IP by One of the World's Leading Semiconductor Companies

TranSwitch® Corporation (NASDAQ: TXCC), a leading provider of semiconductor solutions for the converging voice, data and video network, today announced it has signed a new multi-year, royalty bearing licensing agreement with one of the world’s largest semiconductor companies that is planning to incorporate TranSwitch’s DisplayPort technology inside multiple proprietary products over many years. This agreement potentially includes a number of different TranSwitch intellectual property cores in the area of video transport. The deal includes multiple upfront license fee arrangements and multiple royalty streams, and total revenue from this deal is expected to average over $1 million per year.

TranSwitch has developed a family of products for video transport, including HDMI™ 1.3, DisplayPort, as well as dual mode products supporting both standards. Earlier this year, the company announced an HDMI licensing agreement and is now proud to announce its first DisplayPort licensing agreement. The company also anticipates introducing further new products in this area going forward.

Both HDMI and DisplayPort will coexist as important new high definition video transport standards. HDMI, which stands for High Definition Multimedia Interface, is expected to be the dominant consumer electronics video transport standard. DisplayPort, which is backed by an industry consortium including Intel, Dell and Hewlett Packard, among others, is expected to the dominant standard for PCs. According to iSuppli, the industry will ship 340 million HDMI ports in 2009, a figure that is expected to grow to 770 million by 2012. DisplayPort is expected to ship 27 million ports in 2009, growing to 263 million ports in 2012.

TranSwitch HDMI and DisplayPort technology is built upon technology acquired through the Mysticom acquisition in 2006 and features a fourth generation serializer/deserializer with industry leading performance. “Our unique signal integrity controls and adaptive equalizer, which have been well tested over the years, position us to be a market leader in the large and rapidly growing video transport market,” said Amir Bar-Niv, Vice President for Systems and Applications at TranSwitch Corporations. “With our technology, consumers will get a better video experience while also diminishing the importance of cable quality, currently one of the significant expense items in a high definition video system.”

Dr. Santanu Das, president and CEO of TranSwitch Corporation, said, “This is a landmark achievement for TranSwitch; this adoption validates TranSwitch technology in this area as truly world-class.”

TranSwitch provides a comprehensive package of deliverables to assist customers through all phases of development, design integration and manufacturing of their Systems-on-Chips (SoCs). This package includes a development platform, as well as all documentation and models of the IP, which allows customers to easily integrate the TranSwitch IP cores into complex SoC designs so they can get to market more quickly. Additionally, TranSwitch will provide comprehensive support and training to developers utilizing TranSwitch technology.

About TranSwitch Corporation

TranSwitch Corporation (Nasdaq: TXCC) designs, develops and markets innovative semiconductors and technologies that provide core functionality and complete solutions for voice, data and video communications network equipment. As a leading supplier to telecom, datacom, cable television and wireless markets, TranSwitch customers include the major OEMs that serve the worldwide public network, the Internet, and corporate Wide Area Networks (WANs). TranSwitch devices are inherently flexible, many incorporating embedded programmable microcontrollers to rapidly meet customers’ new requirements or evolving network standards by modifying a function via software instruction. TranSwitch implements global communications standards in its VLSI solutions and is committed to providing high-quality products and services. TranSwitch, Shelton, CT, is an ISO 9001:2000 registered company. For more information, visit www.transwitch.com.

Forward-looking statements in this release, including statements regarding management's expectations for future financial results and the markets for TranSwitch's products, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that these forward-looking statements regarding TranSwitch, its operations and its financial results involve risks and uncertainties, including without limitation risks associated with acquiring new businesses; of downturns in economic conditions generally and in the telecommunications and data communications markets and the semiconductor industry specifically; risks in product development and market acceptance of and demand for TranSwitch's products and products developed by TranSwitch's customers; risks relating to TranSwitch's indebtedness; risks of failing to attract and retain key managerial and technical personnel; risks associated with foreign sales and high customer concentration; risks associated with competition and competitive pricing pressures; risks associated with investing in new businesses; risks of dependence on third-party VLSI fabrication facilities; risks related to intellectual property rights and litigation; risks in technology development and commercialization; and other risks detailed in TranSwitch's filings with the Securities and Exchange Commission.

TranSwitch is a registered trademark of TranSwitch Corporation. HDMI, the HDMI Logo and High-Definition Multimedia Interface are trademarks or registered trademarks of HDMI Licensing LLC.