Zarlink Partners with Embedded Planet on Pseudowire Module Carrying TDM Traffic over Packet Networks

• To be displayed at ITU Telecom World 2006 Asiaworld-Expo in Hong Kong

Zarlink Semiconductor (NYSE/TSX:ZL) today announced that it has partnered with Embedded Planet to develop a pseudowire module that reduces the design time and complexity of networking equipment supporting TDM services over packet-based networks. The pseudowire module targets low-density applications requiring TDM-over-packet capability, including customer premise routers, integrated access devices, PON (Passive Optical Network) equipment, and broadband DLCs (digital loop carriers).

Pseudowires are a key technology that allows service- providers to replace today?s circuit-based networks with one converged packet-based infrastructure delivering the complete range of legacy and emerging services. The EP50120M CESOP PMC pseudowire module, which combines Zarlink?s ZL?50120 CESoP (circuit emulation services-over-packet) technology with PMC-Sierra?s PM4354 COMET QUAD T1/E1 transceiver and Embedded Planet?s years of module expertise, will be displayed in PMC-Sierra?s booth (#2008) at the ITU Telecom World 2006 Asiaworld-Expo in Hong Kong, December 4-8, 2006.

?Service providers need to seamlessly support legacy services even as they migrate to next-generation networks,? said Bruce Ernhofer, product manager, Packet Processing, Zarlink Semiconductor. ?The EP50120M module is a production-ready hardware solution integrating key convergence technologies and expertise from Zarlink, Embedded Planet and PMC-Sierra to deliver T1/E1 service over IP, Ethernet and MPLS networks while supporting a range of service classes to ensure priority for time-critical traffic.?

Delivering TDM service over packet networks

The EP50120M is a multi-functioned device that can function as a standalone processor or be configured as a PTMC module providing CESoP interworking function. The integrated Zarlink ZL50120 packet processor supports up to four T1/E1 trunk connections over an IP, MPLS or Ethernet network and provides structured, unstructured and fractional trunk operation. To efficiently deliver constant bit-rate TDM traffic over variable bit-rate packet switched networks, the ZL50120 processor implements hardware and software processing techniques for clock recovery and synchronization to ensure carrier-class service. The PMC-Sierra COMET® family of T1/E1 transceivers enable low cost, small form-factor solutions with a single design for up to eight ports of T1 or E1.

Service quality is also enhanced by on-chip QoS (Quality of Service) mechanisms, such as weighted fair queuing and strict priority, which minimize the effects of network latency by giving time-sensitive voice traffic priority over data packets in processing queues. Reducing design time and cost, voice service carried by Zarlink?s CESoP technology does not require additional processing, such as compression and echo cancellation.

The module?s circuit emulation features comply with the ITU Recommendation Y.1413, Y.1453, IETF RFC4553, draft-ietf-pwe3-cesopsn-07, the MEF?s MEF8 and the MFA?s MFA 8.0.

Availability

The EP50120M CESoP PMC pseudowire module will be available from Embedded Planet in January 2007. For more information, including pricing and availability, visit: http://www.embeddedplanet.com/products/ep_CESoP.asp. For more on Zarink?s CESoP expertise, visit: http://cesop.zarlink.com/. For more information about PMC-Sierra?s COMET® family of T1/E1 solutions, visit http://www.pmc-sierra.com/.

About Zarlink Semiconductor

For over 30 years, Zarlink Semiconductor has delivered semiconductor solutions that drive the capabilities of voice, enterprise, broadband and wireless communications. The Company?s success is built on its technology strengths including voice and data networks, optoelectronics and ultra low-power communications. For more information, visit http://www.zarlink.com/.

Shareholders and other individuals wishing to receive, free of charge, copies of the reports filed with the U.S. Securities and Exchange Commission and Regulatory Authorities, should visit the Company?s web site at www.zarlink.com or contact Investor Relations.

Certain statements in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Such risks, uncertainties and assumptions include, among others, the following: rapid technological developments and changes; our ability to continue to operate profitably and generate positive cash flows in the future; our dependence on our foundry suppliers and third-party subcontractors; increasing price and product competition; our exposure to product warranty claims resulting from product defects or failures; and other factors referenced in our Annual Report on Form 20-F. Investors are encouraged to consider the risks detailed in this filing.

Zarlink, ZL and the Zarlink Semiconductor logo are trademarks of Zarlink Semiconductor Inc.

For further information:

Edward Goffin
(Media)
613 270-7112
edward.goffin@zarlink.com

Mike McGinn
(Investor Relations)
613 270-7210
mike.mcginn@zarlink.com