Partnership with Creator of Lineage to Drive Regional Games
Business

    TAIPEI, Taiwan, Dec. 11 /Xinhua-PRNewswire-FirstCall/
-- GigaMedia Limited ("GigaMedia" or the
"Company") (Nasdaq: GIGM) announced today a
strategic partnership with and investment in hot game
development studio XLGames Inc. ("XLGames").

    XLGames is founded by gaming legend Jake Song, renowned
as the creator of The Kingdom of the Winds -- one of the
world's first MMORPGs, and Lineage -- the most popular
online game franchise in history.  The company enjoys a
senior management team with deep industry experience and
outstanding talent, and plans to develop games that will
define leadership of the next generation of online games. 

    "Jake Song and his team are superstars -- some of
the world's greatest game developers," stated GigaMedia
President Thomas Hui.  "We are thrilled to partner with
such a tremendously talented team and look forward to
working closely with them on their new MMORPG, which should
rock the world." 

    "GigaMedia is an unrivaled gateway to Asia -- a
great partner and platform for us to showcase world-class,
epic entertainment," stated Chief Executive Officer
Jake Song of XLGames.  "With GigaMedia's game expertise
and huge pan-Asian platform, we look forward to a highly
successful partnership."

    The investment in XLGames is the latest step in
GigaMedia's plan to build the region's leading online
entertainment platform, with a scope that spans all of Asia.

    The partnership strengthens GigaMedia's rapidly growing
pan-Asian entertainment platform, a one-stop solution for
game developers and entertainment providers addressing over
68 million registered users in the region's huge and
lucrative market. 

    Pursuant to the terms of the strategic partnership with
XLGames, GigaMedia has made an investment in XLGames and
obtained board representation and certain strategic rights. 


    About GigaMedia
    GigaMedia Limited (Singapore registration number:
199905474H) is a major provider of online entertainment
software and services.  GigaMedia develops and licenses
software for online gaming. GigaMedia also operates online
games businesses including FunTown, a leading Asian casual
games portal and the world's largest online MahJong game
site in terms of revenue, and T2CN, a leading online casual
sports game operator in China. More information on GigaMedia
can be obtained from http://www.gigamedia.com.tw .

    About XLGames
    XLGames Inc. was founded in Seoul, Korea in 2003 by
NCSoft's former Executive Vice President and Head of
Worldwide Development, Jake Song, creator of Lineage, one of
the most popular and successful MMORPGs of all time. XLGames
also develops games in its subsidiary office in Austin,
Texas, to help insure the company's products have strong
appeal to the diverse cultural preferences of both Asian and
American gamers.  XLGames' global game design team
collaborates on all aspects of art, engineering and design. 

    
    The statements included above and elsewhere in this
press release that are not historical in nature are
"forward-looking statements" within the meaning of
the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995.  GigaMedia
cautions readers that forward-looking statements are based
on the Company's current expectations and involve a number
of risks and uncertainties.  Actual results may differ
materially from those contained in such forward-looking
statements.  Information as to certain factors that could
cause actual results to vary can be found in GigaMedia's
Annual Report on Form 20-F filed with the United States
Securities and Exchange Commission in June 2007.
    
    For further information contact:

     Brad Miller
     Investor Relations Director
     Tel:   +886-2-2656-8016
     Email: brad.miller@gigamedia.com.tw

SOURCE  GigaMedia Limited