News release

Zi Corporation



Zi to develop interface solution for Voice over IP market


Calgary, AB (December 5, 2000) - Zi Corporation's (NASDAQ: ZICA) (TSE: ZIC) international engineering services division has been awarded a global contract to provide the reference design for a new IP phone to be manufactured by BTL Systems (HK) Limited, a wholly owned subsidiary of Hong Kong Communications Co. Ltd. IP telephones allow voice signals to be sent as data packets over any Internet protocol network, such as the Internet or a company Intranet. Under the three-year development and royalty agreement with BTL, Zi will provide the VoIP reference design and BTL will manufacture and sell the final phone product.

"Through the Zi telecom services division, Zi is able to provide engineering expertise to leading companies around the world in VoIP design," says Gary Kovacs, president, Zi Corporation. "Zi's VoIP interface solution is compatible with VoIP equipment from Alcatel, Dialogic, RADVision and Siemens giving the end consumer flexibility."

The IP telephone market is expanding rapidly worldwide. By combining both data and voice through the same Internet protocol, IP telephony provides many economies. Monthly line costs can be significantly reduced because the compressed data allows the system to be used more efficiently and the same wiring system can be used for voice and data thereby eliminating the need for traditional PBX systems. Additionally, VoIP can provide long distance savings for businesses with remote offices by using their Intranet to send messages.

"BTL has established distribution channels in Europe and South East Asia and we are now expanding into VoIP products," said Hubert Chan, director, BTL systems. "We can focus on this emerging market with Zi's customized support and BTL's solid experience in telephone manufacturing."

An IP phone combines traditional phone functioning with enhanced features. The BTL phone design will have functions such as a speakerphone and will be able to interface with VoIP gateways and gatekeepers deployed by cable service providers. In the development process, Zi will architect the interaction for major subsystems such as user interface, voice interface, network interface and communication protocol interface.

BTL is a manufacturer of communication products such as key telephone systems, DECT wireless PABX systems, voice mail and auto attendant systems. BTL distributes products under the BTL brand and also manufactures products for companies such as Alcatel and Nitsuko. From a factory in Shenzhen, BTL manufactures over 30,000 telephones per month.

Zi Corporation is a market-driven technology company focused on developing and delivering intelligent interface solutions and services to the wireless and consumer Internet market. The company's core technology product, eZiText™ connects people to short messaging, e-mail, e-commerce, Web browsing and similar applications in almost any written language. The company's service division provides market-leading engineering design in Bluetooth, VoIP and man-machine interface. Zi supports its strategic partners from offices in Calgary, Beijing, Hong Kong, San Francisco, Shenzhen, Stockholm and Tokyo. A publicly traded company, Zi Corporation is listed on the NASDAQ National Market (ZICA) and the Toronto Stock Exchange (ZIC).

Certain statements in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The information in this press release is based on Zi Corporation's current expectation and assumptions, and is subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. Such risks include, among others, general business and economic conditions and competitive actions as well as the risks and uncertainties referred to in Zi Corporation's 20-F for the most recent calendar year.

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For further information, please contact:

Randy Henderson
Vice President, Finance
Zi Corporation
Phone: (403) 231-4580
Email: investor@zicorp.com
Web site: www.zicorp.com
Hubert Chan
Director
BTL System (HK) Limited
Phone: 852-2873-0802
Email: hubert@hkc.net
Web site: www.btlhk.com


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