Harmonic Goes Into SKY Perfect

SUNNYVALE, Calif. -- Harmonic Inc. (Nasdaq:HLIT - News) today announced that SKY Perfect Communications Inc., Japan's leading digital multi-channel satellite broadcasting company, is upgrading its video infrastructure with Harmonic digital headend systems. Harmonic's award-winning DiviCom® MPEG-2 encoders and industry-leadingDiviTrackXE(TM) statistical multiplexer, which form the foundation of the new service, are expected to effectively double the capacity of SKY Perfect's existing satellites while improving picture quality. SKY Perfect will also use Harmonic's NMX Digital Service Manager(TM) to maximize service availability and simplify the operation of its geographically distributed video infrastructure. The system is scheduled to be fully operational in January 2005.

With more than three million direct-to-home (DTH) subscribers, SKY Perfect is Japan's leading digital multi-channel satellite broadcasting company. A respected pioneer of digital broadcast services, SKY Perfect has grown its subscriber base by continually expanding its video and audio programming. Though satellite is the primary service platform, SKY Perfect is exploring delivery vehicles such as fiber-to-the-home (FTTH) to extend its reach.

"SKY Perfect's mid-term strategy calls for us to reach the five million subscriber mark by 2007 through the aggregation of rich entertainment and information content that addresses a wider range of our subscribers' needs and interests," said Mr. Hajime Shigemura, president of SKY Perfect Communications Inc. "After thorough research and evaluation, we found that Harmonic digital video solutions were best able to help us achieve our business objectives."

A recognized leader in video compression and transport, Harmonic systems provision digital television channels for many of the world's largest direct-to-home satellite broadcasters. Harmonic has refined two essential technologies that, when combined, can multiply the capacity of a network. DiviCom encoders with advanced noise reduction and filtering remove even subtle imperfections to deliver crisp and clear, broadcast-quality video at very low bit-rates. DiviTrackXE, the third-generation closed loop statistical multiplexing system, dynamically reallocates bandwidth between programs in a transport stream to further expand the service-carrying capacity. This system is fully compatible with SKY Perfect's installed base of set-top boxes and transport equipment, enabling a seamless transition that will increase the return on SKY Perfect's existing infrastructure investments.

"In just a few years, SKY Perfect has built one of the most successful satellite broadcast services in the world. They have set a very aggressive growth plan in the face of increasing competition that assumes a substantial increase in the number and types of channels as well as an improvement in picture quality and service availability," said Anthony J. Ley, president and chief executive officer of Harmonic Inc. "SKY Perfect's evaluation process, one of the most rigorous of its kind, is a strong affirmation of our technology and service leadership."

Harmonic Inc.