For Immediate Release (Calgary, AB Canada)
July 26th, 1999

Zi licenses Multi-language Smart Text Input Software to the Research Institute of TV and Electro-Acoustics of the Ministry of Information Industries of the 
People’s Republic of China.

Zi is pleased to announce it has licensed its Multi-language Smart Text Input Software to the Research Institute of TV and Electro-Acoustics of the Ministry of Information Industries (MII) of the People’s Republic of China, also known as the No.3 Institute. The Institute and Zi will cooperate to provide the Zi Input software on a range of set top box devices to be sold in China and for export in international markets.  The Institute is a Government body directly owned by the MII, headquartered in Beijing. It was founded in 1960. The Institute adapts set top box designs to suit the specific needs of the Chinese consumer and is currently working with several set top box solutions from leading international semiconductor manufacturers.

Zi Corporation’s license with the MII establishes a preferred input solution for the design and manufacture of set top boxes in China. Zi’s multi-language smart text input software system is now available to all Chinese manufacturers of TV set top boxes and other consumer information appliances.  The Institute plays a major role in quality assurance and approval of television and broadcasting products, including set top boxes, sold in the domestic market. Some of the senior members of the Institute also sit on many central government regulatory bodies, which set standards for television and broadcasting technology.  In addition to its statutory role, the Institute also completes broadcasting systems solutions for large-scale cable television and satellite broadcasting projects in China.

Chinese Government estimates show that Chinese families currently own 317 million television sets, 40 million VCD machines and almost 20 million television game consoles. Telephone line penetration has reached 50% in the cities.  There are 70 million cable television subscribers in China and the government plans to link all cities and towns to cable television by the end of this year.  Presently about 2000 cities and counties are already covered. The objective is to make available to the Chinese consumer electronic content such as Internet services, video on demand, music on demand and on-line shopping.

Mr. Chen Ke, Chief Engineer of the Research Institute of TV and Electro-Acoustics, said, "We have been a pioneer in promoting the best in set top box technology for the China market. Zi's state-of-the-art input technology now opens up new opportunities for our partners both inside and outside China to make set top box technology more interactive and user-friendly in both Chinese and other languages."
 
"This agreement with the MII’s Research Institute of TV and Electro-Acoustics is another key series of endorsement of Zi’s technology in China.  The MII has been playing a major role in promoting the consumer Internet and on-line service industry in China.  As part of this process, the Institute develops access terminal reference designs best suited to the Chinese set top box manufacturers." noted Antoine Blondeau, Senior Vice-President of Marketing and Sales at Zi Corporation. “The Institute’s high requirements for mass-market solution for Chinese text input on a set top box have been fulfilled by Zi’s input technology."

Zi Corporation’s goal is to create modern electronic technology more accessible to people in a way that is consistent with their language and culture. By connecting technology to language, Zi Corporation brings smart text input to the mass market for devices such as mobile phones, TV set top boxes, computers and information appliances.

Certain statements in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 including, without limitation, statements concerning the anticipated benefits to Zi Corporation of its agreement with No.3 Institute. The expected inclusion of Zi Input technology in products developed by No.3 Institute and potential license, royalty and maintenance fee amounts involve risks, uncertainties and other factors which may cause the actual results, performance or achievements of Zi Corporation to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  Such factors include uncertainties in the ability to successfully collaborate with No.3 Institute; the ability of Zi Corporation to successfully design, develop, and deliver any application that complies with No.3 Institute’s specifications and is accepted by No.3 Institute; the ability of Zi Corporation to successfully meet specific delivery dates set forth by No.3 Institute; the ability of Zi Corporation to successfully integrate and maintain compatibility with No.3 Institute’s technology; possible failure to continue to be selected as the Chinese character-based language enabling technology by No.3 Institute; the ability of No.3 Institute to successfully market and distribute any of its products incorporating Zi technology; economic conditions in Asia; the risks of doing business in foreign countries including China; and the risks and uncertainties referred to in Zi Corporation’s Report of Form 20-F for the year ended December 31, 1998 filed with the U.S. Securities and Exchange Commission.  There can be no assurance that Zi Corporation will achieve commercial success through the agreement described herein.

NEITHER THE TORONTO STOCK EXCHANGE NOR NASDAQ HAVE APPROVED OR DISAPPROVED OF THE INFORMATION CONTAINED HEREIN.

FOR FURTHER INFORMATION, PLEASE CONTACT:

Zi Corporation
Manager, Investor/Media/ Relations
+1 403.233.8875
E-mail: investor@zicorp.com
Web site: http://www.zicorp.com

No 3. Institute of the Ministry of Information Industries
Mr. Chen Ke
Chief Engineer
+86 10 6436 3131