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DSP Group Announces Acquisition of BoneTone Communications
Provides Unique Entry Into Mobile Market Through Unrivaled Voice and Audio Enhancement Products

SAN JOSE, Calif., Dec. 5, 2011 (GLOBE NEWSWIRE) -- DSP Group®, Inc. (Nasdaq:DSPG), a leading global provider of wireless chipset solutions for converged communications at home, is pleased to announce today the exercising of its option to acquire BoneTone Communications, a provider of innovative chip solutions that redefine audio quality and voice intelligibility in mobile devices and headsets. The acquisition provides DSP Group with diversification and cutting-edge technology in the promising and fast-growing mobile device market. BoneTone's products are expected to generate revenues already in 2012.

BoneTone leverages unique signal-processing technologies that transform inaudible voice calls into clear and comprehensive conversations, and redefines the music-listening experience in mobile devices. Raising the bar for mobile sound quality, BoneTone offers two groundbreaking chips. HDClear™ is the only chip that completely removes background noise for far end users. The chip can be embedded in mobile devices, as well as in Bluetooth, corded and DECT headsets. HDMobileSurround™ enables mobile phone, tablet and PC users, through the use of an advanced small form-factor headset, to enjoy home theater-quality sound on the go while gaming or watching movies.

DSP Group's acquisition of BoneTone, for a consideration of approximately $10 million, comes two years after the companies entered into a strategic partnership. Toward the end of 2009, DSP Group acquired an equity stake in BoneTone that included a 24-month option to purchase the company's remaining shares.

"The acquisition of BoneTone enables us to differentiate and expand our product portfolio, as well as strengthen our leadership in converged communications," said Ofer Elyakim, CEO of DSP Group. "By leveraging our product development abilities, marketing infrastructure and broad customer base, we expect BoneTone's innovative solutions to generate growth in several areas. BoneTone's focus on the mobile phone industry further opens the door to an expanding market with long-term growth potential."

"BoneTone is excited to be part of DSP Group and its top-notch professional team," said Dr. Arie Heiman, Chairman & CEO of BoneTone Communications. "We are confident that the company's proven track record, strategic strength and leadership position will help us penetrate into diverse markets, and reach even higher levels of achievement. After successfully collaborating with DSP Group over the last two years, we look forward to playing a key role in its expansion plans."

About BoneTone Communications

BoneTone Communications Ltd. is a provider of innovative IC solutions that redefine audio quality and voice intelligibility in mobile devices and headsets. Leveraging the Company's unique signal processing technology and off-the-shelf bone conduction components, BoneTone Communications improves voice call intelligibility and the music-listening experience in mobile devices. BoneTone Communications' HDClear™ chip removes all background noise for far end users to ensure uninterrupted voice calls in both high-ambient indoor and outdoor environments. The chip can be embedded in mobile devices, as well as in Bluetooth, corded and DECT headsets. HDMobileSurround™ enables mobile phone, tablet and PC users, through the use of an advanced small form-factor headset, to enjoy home theater-quality sound on the go while gaming or watching movies. BoneTone Communications' full reference design also enables consumer electronics (CE) manufacturers to cost-effectively develop new innovative products at fast time to market. For more information, visit www.bonetone.com.

About DSP Group

DSP Group, Inc. (Nasdaq:DSPG) is a leading global provider of wireless chipset solutions for converged communications at home. Delivering system solutions that combine semiconductors and software with reference designs, DSP Group enables consumer electronics (CE) manufacturers to cost-effectively develop new revenue-generating applications with fast time to market. At the forefront of semiconductor innovation and operational excellence for over two decades, and with a growing share of the wireless home telephony market, DSP Group provides a broad portfolio of wireless chipsets integrating DECT, Wi-Fi, PSTN and VoIP technologies with state-of-the-art application processors. Enabling converged voice, audio, video and data connectivity across diverse consumer products – from cordless and VoIP phones to home gateways and connected multimedia screens – DSP Group proactively partners with CE manufacturers to shape the future of converged communications at home. For more information, visit www.dspg.com.

The DSP Group, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6171

CONTACT: Orly Garini-Dil
         DSP Group, Inc.
         Tel: +1-408-240-6839
         Email: orly.garini@dspg.com
         www.dspg.com

         Monica Maron
         Spicetree Communications
         Mobile: +972-54-5429529
         Email: monica.maron@spicetreecom.com

Image: DSP Group

DSP Group, Inc.