M-Systems Launches USB Keychain Storage Technology Platform

5/15/2003 - M-Systems' (Nasdaq: FLSH) DiskOnKey, the defacto standard and leader in the USB keychain storage category, announced the Smart DiskOnKey Technology Platform, an evolutionary step for USB keychain storage devices. The platform was developed to meet tier one brand customer needs for design flexibility and consumer demand for ease-of-use. This enhanced platform delivers the technology foundation for current and next generation keychain devices enabling security, reliability, personalization and future extensions of the device via SW and HW development. With this new platform M-Systems has again taken the USB keychain category to the next level.

Smart DiskOnKey's architecture demonstrates M-Systems' innovative approach to the category. The Company's proprietary patented flash file system, TrueFFS, resides on the platform removing the risk of data loss and corruption on flash memory chips. TrueFFS also allows support for all flash types available in the market, ensuring partners of the best cost/features combination in the market. Performance has been increased with Fly-By, a new process that bypasses a computer's CPU improving read/write speeds to the best level existing in today's market.

"The Smart DiskOnKey platform furthers our vision for the category-allowing us to address the market's need for floppy drive replacement, as well as taking it beyond just simple storage," said Dov Moran, president of M-Systems. "We consistently deliver innovation into the market, and this iteration of the technology sets the stage for the next generation of personal data devices. We are defining the standard and enabling partners to customize and leverage these devices for specific consumer or business solutions."

Through Smart DiskOnKey, M-Systems is not only meeting the need for floppy replacement technology but also tier one brand partners requirements for design flexibility and higher capacities. This is accomplished by delivering a variety of PCBs such as those currently found in the DiskOnKey Classic and DiskOnKey Pro, and now also with the introduction of a 1GB USB 2.0 device. The platform further improves ease-of-use for consumers, the guiding line for M-Systems' USB drives from the beginning, and empowers partners to customize designs, create applications and differentiate themselves through this groundbreaking technology.

"OEMs, brand partners and application developers have realized the potential of the Smart DiskOnKey Technology Platform as offering compelling solutions including such features as data security, data integrity, complex storage functions and bootability," said Blaine Phelps, director of worldwide marketing, M-Systems' DiskOnKey Business Unit. "In fact our partners are validating their trust in M-Systems by including Smart DiskOnKey on their packaging and marketing materials that accompany their keychain storage devices."

As the USB keychain storage category matures, data privacy and reliability are taking a prominent role. M-Systems has been a leader in the security space with its Fortress Security division, the renowned hardware-based encryption developer. M-Systems has offered privacy protection on its DiskOnKey devices with its KeySafe privacy product since 2001. The Smart DiskOnKey platform enables continued innovation for evolving security needs.

M-Systems has garnered industry endorsement and trust through the acceptance of the Software Developers Kit (SDK) among a variety of application providers. CapMed, an application developer and partner, has capitalized on Smart DiskOnKey Technology with the recent implementation of the CapMed Personal HealthKeyTM. This portable medical record enables user's to securely manage, transfer and communicate health information by integrating CapMed's award-winning personal health management software with the DiskOnKey. This technology plays to powerful trends in healthcare such as medical errors and HIPAA by enabling seamless access to patient-controlled data via the HealthKey. Additionally, the HealthKey can be customized to interface and capture data from physicians, hospitals, medical imaging, insurers, pharmacy and labs. IO Data, a partner of M-Systems, has implemented the SDK to design a graphical user interface (GUI) allowing partners to customize the device for their own specific needs. NovaStor, a software storage solution provider, has implemented automatic backup solutions using M-Systems' DiskOnKey device combined with its data protection software. Critical data is automatically located and routed to the keychain storage device for backup.

"The USB flash drive market has achieved significant growth recently by addressing consumers' needs for a widely accepted format for a removable solid state storage device. USB flash drives are poised to become a competitive threat to standard flash card formats. It is the ubiquity of the USB port that gives the USB Flash drive a distinct advantage over standard flash cards while also posing a serious threat to the existence of the functionally obsolete floppy disk drive," said Joseph Unsworth, analyst semiconductor memories, Gartner Dataquest.

About M-Systems' Smart DiskOnKey Technology Platform
Smart DiskOnKey platform is a unique solution offering tier one brand partners the option to choose from M-Systems' existing product line or to differentiate themselves by designing their own form factor while still using M-Systems' internal architecture. The award-winning DiskOnKey product line offers trusted quality, reliability and data protection. M-Systems substantiates this claim by submitting the DiskOnKey Classic, DiskOnKey Pro and DiskOnKey Classic 2.0 to rigorous testing for reliability and durability, earning Microsoft's Windows Hardware Quality Testing Lab (WHQL) certification as well as receiving the certified-USB logo set by the USB-IF.

Smart DiskOnKey platform offers storage capacities ranging from 16MB to 1GB with the flexibility to support applications directly from the device. Smart DiskOnKey is supported by numerous development tools, allowing the creation of both HW and SW extensions of the device beyond simple storage functionality. It is offered globally, through major partners including IBM, Apple, Compaq, Fujifilm, Iomega, Verbatim and others.

About M-Systems
M-Systems (Nasdaq: FLSH) is a leader and innovator of flash-based data storage products known as flash disks. M-Systems' flash disks provide the functionality of a mechanical hard drive in a silicon chip. M-Systems' products are based on its patented TrueFFS® technology and target applications in a vast array of markets, including connected devices, mobile and telecom. M-Systems' products include the DiskOnChip®, DiskOnKey® and Fast Flash Disk (FFDTM) product families. For more information, please contact M-Systems at www.m-sys.com.

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