SAN JOSE, Calif., October 13, 1997 - ISD (Information Storage Devices, Inc.) (NASDAQ: ISDI) today announced the ISD1500 ChipCorder^® series, a family of low cost voice record and playback integrated circuits. The ISD1510, the first chip in the six to 20 second product line, is a 10-second, single-chip voice record and playback device offering natural sound reproduction for short-duration applications in the industrial electronics, toy, novelty and promotional markets.

"We are clearly demonstrating our across-the-board leadership in voice solutions by continuously improving our high-quality, easy-to-design in products," said David Angel, CEO of ISD. "Today's announcement of the ISD1500 series, an industry first in offering competitive pricing for high sound quality in the short duration market, follows recent announcements targeting increased activity with our longer duration product lines. We already have several ISD1510 design wins with major companies in the toy, novelty and promotion industries."

"We are delighted to be one of the first customers to integrate the ISD1510 voice chips into our promotional products," said Tim Clegg, president of Clegg Industries. "In the promotions market, high-quality playback for sound and music is crucial in order to please our customers. ISD has met our internal production needs for limited design space and cost-sensitive products."

Peter Gordon, product manager for ISD's short duration products said, "We believe that the toy, novelty, promotion and security markets combined exceeds 20 million units per year. With the ISD1500 offering ISD's renowned sound quality at unprecedented low prices, it could trigger an avalanche of new designs that were not previously feasible due to price considerations."

ISD1510

The ISD1500 delivers single-messaging functionality, and added functions such as sound warping, to enable its toy, novelty, promotions and industrial customers to design innovative products while saving systems costs. ISD has also enhanced its proprietary multilevel, mixed-signal technology for improved sound quality and simple design and like all ISD devices, the ISD1500 family does not require battery power to retain recorded messages.

* Improved frequency response - The ISD1500 family has excellent high-frequency response allowing cleaner playback of high fidelity music and children's voices, an important feature for toys.

* Improved AGC - More efficient AGC (automatic gain control) enables a wider record signal range and less distortion during playback, making it easier to provide higher quality recording.

* Customer-controlled resistor oscillator - ISD customers can control the sample rate on the chip, thereby adjusting the total record and playback durations. This function also manipulates playback to produce a "warping" effect, where recorded voices change from a bass to a soprano. This fun and unique feature is popular for toys, novelties and promotions.

* Single-message design - The ISD1500 family needs fewer external components and bond pads than its short duration predecessors, resulting in lower system costs. The ISD1500 series also has a "wink" feature that indicates the end of the message during playback by a momentary pulsing of an LED.

* Improved speaker drivers - The ISD1500 family has built-in connections for speakers, so no additional external components are necessary. This is an attractive feature to toy and novelty manufacturers who are looking to produce more environmentally-friendly "green" products that do not require additional circuitry, have low production costs and consume less battery power. The new speaker drivers allow the use of eight ohms speakers which enables louder playback while maintaining excellent signal-to-noise ratios.

ISD ChipCorder Product Line

ISD ChipCorder products provide nonvolatile single-chip record and playback solutions, offering customers high-quality, low-power, cost-effective and simple-to-use products for a variety of communications, consumer and industrial applications. ChipCorder products utilize ISD's proprietary "multilevel" storage methodology in which one of more than 250 distinct voltage levels is precisely stored per memory cell. This technology enables voice and audio signals to be stored directly, in analog or digital form, into EEPROM and FLASH memory cells, providing up to eight times more storage space for any given memory.

ChipCorder technology has been incorporated into hundreds of products, including cellular phones, pagers, personal voice organizers, telephone answering devices, voice "message pads," games, toys, interactive books, alarms, point-of-sale displays, novelty items and personalized gifts. It is also found in industrial announcement/annunciator systems, instrumentation and building security systems.

Pricing and Availability

The ISD1510 is expected to be available in December and is priced at 99 cents (US) in die form for quantities of 10,000 units. The six-second ISD1506 and the 20-second ISD1520 are expected to be available in February 1998 and April 1998, respectively.

About ISD

ISD, a leading supplier of semiconductor voice record and playback solutions, provides essential products to the communications marketplace using its proprietary multilevel storage and related technologies. ISD is headquartered at 2045 Hamilton Avenue, San Jose, California 95125, USA. Telephone: (408) 369-2400. Fax: (408) 369-2422. World Wide Web home page: http://www.isd.com.

This press release contains forward-looking statements regarding features and performance of future products and the benefits and future applications for ISD's new family of low cost record and playback chips. Actual results could differ materially as a result of a number of factors including the following: cyclical nature of the markets and demand for the Company's products; the timing of new product announcements; the ability of the Company's customers to develop and market products incorporating the new short duration voice circuits; availability of foundry capacity and raw materials; fluctuations in manufacturing yields; competitive pricing pressures; the ability of the Company to develop or acquire needed technology, assimilate personnel and pursue new markets; increased research and development expenses; economic conditions generally or in various geographic areas; and the risk factors listed from time to time in the Company's SEC reports, including but not limited to its report on Form 10-K for the year ended December 31, 1996.

Note: ChipCorder is a registered trademark of ISD. CompactSPEECH is a trademark of ISD.