Analyst/Investors, please contact:
Jim Recob, Iomega Corporation, (801)332-4430 recob@iomega.com

FOR IMMEDIATE RELEASE

Iomega Announces New PeerlessTM Drive System

Revolutionary New Design Leaps Past Optical
with 5GB, 10GB and 20GB Removable Disks

ROY, Utah, January 5, 2001 - Iomega Corporation (NYSE:IOM), a global leader in data management solutions, today announced a new modular drive platform for PC and Macintosh® users: the Iomega® PeerlessTM drive system. Debuting this month at CES and MacWorld and expected to ship mid-year in the U.S., the Peerless drive system represents a new generation of high performance data storage devices that delivers market-leading affordability, versatility and reliability.

The PeerlessTM disk, which incorporates world-class hard drive technology in 5GB, 10GB and 20GB capacities, is roughly the size and shape of a PDA. It slips into a base station only slightly larger than the disk itself-a slim, vertical enclosure about four inches across and five inches tall. The Peerless drive system offers up to ten times the performance and massively greater storage capacity than CD-RW, DVD-RAM, DVD-RW, or DVD+RW alternatives.

"Iomega's Peerless drive system is an exciting new advance in digital data management," said Bruce Albertson, president and CEO, Iomega Corporation. "We believe that its modular design, high capacity and hard-drive performance will be so compelling that Peerless will open up an entirely new class of devices. Data-intensive tasks that cannot be performed with DVD-class optical drives, such as handling multiple video streams, will be accomplished simply, cheaply and reliably with this portable device. The Peerless drive system may well become the best way yet of managing your digital life."

Innovative Design
Two key design innovations contribute to the Peerless drive system's price-performance leadership. The first is Iomega's integration of read/write heads into fully sealed 5GB, 10GB and 20GB removable disks, an advance that eliminates the risk of dust contamination and allows sustained transfer rates in the range of an expected 15 MB/sec (with FireWire® module). The second is the relocation of the hard drive electronics from the Peerless disks to the base station, an Iomega breakthrough that is a first in the hard drive industry. The result is disk prices as low as an expected one cent per megabyte.

Applications
The PeerlessTM drive system is an affordable, high performance hardware solution with a sleek and appealing industrial design. It also uses industry-standard interfaces for simple integration into new devices. A wide range of new and exciting products, from mobile multimedia devices to radical new computer designs, stand to benefit from the Peerless drive system. Everything from editing digital video sequences to running consumer software applications to backing up large hard drive partitions will be possible with the power of the Peerless drive system.

In enterprise applications, the Peerless drive system offers security and performance. Peerless disks include chip-based identifier technology to enable data security, protecting against unauthorized attempts to read the contents of a lost or stolen disk. Peerless disks will be indispensable tools in 3D CAD/CAM, software development, database management, entertainment authoring, and other applications where the portability of large data sets brings added value. The ability to back up critical content to Peerless disks for high-speed random access retrieval also means a new alternative to tape drives in some applications. As an enabling technology, the Peerless drive system can be the basis of hardware designs that give multiple users their own portable environment on a disk.

Price and availability
The Iomega PeerlessTM drive system is expected to begin shipping mid-year 2001 to major U.S. retailers, with shipments to Europe and Asia/Pacific to follow in the third quarter. The drive with interface module is expected to retail for $249 (U.S. suggested retail price). Peerless disks are expected to retail for $129 (5GB), $159 (10GB) and $199 (20GB) (U.S. suggested retail prices). FireWire and USB 1.1 interface modules are expected to be available at the launch, with USB 2.0 and SCSI available as follow-on products.

About Iomega
Iomega Corporation (NYSE:IOM) manufactures and markets the award-winning Zip®, Jaz® and PocketZipTM drives and disks, the HipZipTM digital audio player, the FotoShowTM digital image center, LifeWorksTM software, and Iomega Quik Sync 2 software; Iomega also markets Iomega CD-RW drives. Iomega's products help people to save, share, manage and create important information such as Internet downloads, audio files, personal photographs, spreadsheets, and slides, while protecting that content from viruses and hackers. Used in homes, businesses, government and educational facilities and by creative professionals everywhere, Iomega storage solutions are the enabling technologies preferred by millions. The Company can be reached at 1-888-4-IOMEGA (888-446-6342), or on the Web at http://www.iomega.com.

NOTE: The statements contained in this release regarding development, production and distribution of the Peerless drive and disks, anticipated product pricing and availability, expected product performance and specifications, future applications for the new product and all other statements that are not purely historical, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements are based upon information available to Iomega as of the date hereof, and Iomega disclaims any intention or obligation to update any such forward-looking statements. Actual results could differ materially from current expectations. Factors that could cause or contribute to such differences include, but are not limited to, the successful completion of product development and testing, market acceptance of, and demand for, the Peerless products, any difficulties encountered in ramping up production or other manufacturing issues, including component availability and pricing, co-development, production, and distribution issues, product pricing and conformity to specifications, dependence upon third party suppliers, competition, intellectual property rights and other risks and uncertainties identified in the reports filed from time to time by Iomega with the U.S. Securities and Exchange Commission , including Iomega's Annual Report on Form 10-K for the year ended December 31, 1999, and its most recent Quarterly Report on Form 10-Q.

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Copyright(c) 2001 Iomega Corporation. All rights reserved. Iomega, Zip, Jaz, PocketZip, HipZip, FotoShow, LifeWorks, and Peerless are either registered trademarks or trademarks of Iomega Corporation in the United States and/or other countries. Macintosh and FireWire are registered trademarks of Apple Computer Inc. Certain other product names, brand names, and company names may be trademarks or designations of their respective owners.