**********************************

“While the digEcor complaint has hindered volume eVU mobile entertainment system orders to date, our turnkey entertainment services business continues to be well-received by companies offering, and expected to offer, eVUs to their customers/passengers/patients,” said Will Blakeley, e.Digital’s president and chief technical officer. “With Maycom’s scheduled delivery of the delayed 1250 units in mid-October and volume eVU production beginning this quarter with our U.S. manufacturer, we are focused on closing volume eVU orders and aggressively pursuing the monetization of our flash memory patent portfolio.”

In addition to direct eVU product sales, e.Digital believes that as its turnkey entertainment services solution is adopted, the Company will capture more margin on each unit sale and collect monthly revenues from content and other services, and could become profitable with annual deliveries totaling approximately 4,000 eVU units.

Blakeley concluded by providing an update on the company’s efforts to monetize its flash memory-based patent portfolio. “Over the last month, we have had productive IP consultations with several well-respected intellectual property law firms. We believe there is significant interest in prosecuting our patent portfolio on a contingency basis. With the assistance of IP veteran, Pat Nunally, management and outside law firms have been conducting patent due diligence while evaluating the licensing potential to companies in the cell phone, PDA/Pocket PC, portable A/V recorder, digital camera, camcorder, and other portable device industries. Based on results to date, we are encouraged about the prospects of beginning the licensing process to monetize our important patent portfolio this calendar year.”