Next Generation ZVUE Portable Media Player Announced

Oct. 10, 2005-- HandHeld Entertainment today announced its next generation ZVUE, as well as plans for an entire family of ZVUE portable media players, products the company believes will raise the bar for future digital video/audio/photo media players.

"The next generation ZVUE is our next step in creating a complete product family of personal media players that everyone can easily afford and use," said Jeff Oscodar, president and chief executive officer of HandHeld Entertainment. "While other companies are making expensive complicated products, we are continuing to make products that are affordable and easy to use by everyone."

With its manufacturer's suggested retail price slated to be between $149 and $199, the upcoming next generation ZVUE will feature on-board flash memory, a rechargeable lithium-ion battery, and be compatible with Windows Media Video (WMV) and Windows Media Audio (WMA) through the use of Microsoft's secure Digital Rights Management (DRM) software.

Supporting Microsoft's DRM will allow all ZVUE users to download video and audio content from the ZVUE download site at www.zvue.com/downloads, as well as at hundreds of online locations, such as Walmart.com, Rhapsody and Yahoo! Music, among others. As a result, HandHeld Entertainment will be the first company in the world to deliver a Windows DRM-enabled portable media player at less than $200.

"Our ZVUE product family (the current ZVUE, the next generation ZVUE and beyond) will provide our customers with easy access to great music and video content on both our site and all over the Internet," Oscodar said. "By supporting industry standard security software and developing our own site, our customers can start enjoying digital video and music right out of the box. We've also seen significant interest from Hollywood because of the security that our products provide and because our products are so affordable. Since price is still a concern for most young consumers, you can be sure that when the next generation ZVUE hits store shelves, it will still cost a lot less than any potential video-iPod."

HandHeld Entertainment announced its first ZVUE in mid-2003 with a $99 price point and shipped its first units before Christmas 2003. Version 1.1 is currently available online and in more than 1,500 retailers throughout the United States, including selected Wal-Mart stores and Discovery Channel Store locations nationwide.

HandHeld Entertainment's next generation ZVUE will be its first portable media player to sport on-board storage functionality. The initial ZVUEs (versions 1.0 and 1.1) solely utilized SD/MMC flash memory cards -- roughly the size of a postage stamp -- for storing music, videos and digital photos. The next generation ZVUE will also support SD/MMC flash memory cards.

HandHeld Entertainment Touts ZVUE Family of Portable Media Players
The next generation ZVUE will utilize a thinner housing than the original ZVUE and will be available in new colors. HandHeld will publicly unveil the next generation ZVUE in January at the 2006 Consumer Electronics Show held in Las Vegas, Nevada. The company plans to have multiple ZVUE models available for purchase in 2006, including both the original and the next generation ZVUE models.

"We have been delighted with the success of the pioneering ZVUE and think the next generation device will have people talking about it longer than a mere 'nano' second," Oscodar said. "At the end of the day, our products are affordable, available in Wal-Mart and beyond, and provide accessibility to all of the Web's secure legal content."

ZVUEs give digital media lovers the ability to take their favorite video, audio and digital picture content on-the-go by simply downloading films and music from the ZVUE download Web site, www.zvue.com/downloads and other content sites. About the size of a pack of playing cards, the highly-portable ZVUE plays videos, music and audio files that can be taken anywhere, anytime.

SOURCE HandHeld Entertainment