e.Digital Corporation and APS, Inc. Unveil Installed IFE System
Monday September 27, 11:34 am ET
International Airlines AEROFLOT and KLM to Offer digEplayer 5500


SAN DIEGO--(BUSINESS WIRE)--Sept. 27, 2004--e.Digital Corporation (OTC:EDIG - News), a leading innovator of proprietary digital audio and video technology platforms, and APS, Inc., a leading innovator in in-flight entertainment systems, successfully unveiled working prototypes of an installed version of APS' digEplayer(TM) video-on-demand (VOD) system at last week's 25th Annual Conference and Exhibition of the World Airline Entertainment Association (WAEA) in Seattle.
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The new installed in-flight entertainment (IFE) system is expected to be the first independent VOD system, without any dependence on a central server. Content can be easily loaded to the system to hard drives with capacity for 60+ full-length feature films. The system is also expected to include television shows, music and video games.

''We are pleased to be working with APS on this installed MicroOS(TM)-powered version of the digEplayer,'' remarked Atul Anandpura, e.Digital's president and chief executive officer. ''Beyond its many other advantages, this system alleviates logistics support and will be easy to service and maintain.''

''For cost-conscious regional airlines looking for an embedded solution, we have the answer,'' said Bill Boyer, president of APS. ''We received strong interest in this new installed system at the conference from several airlines looking for an alternative to the heavy, expensive systems currently on the market. We continue to experience growing acceptance of the portable digEplayer 5500(TM), with Ryanair, KLM, AEROFLOT and other airlines coming aboard as our newest customers. By offering both a portable and installed version of the digEplayer, we are well-positioned to rapidly grow our IFE sales.''

''This WAEA conference was very successful for e.Digital and APS,'' concluded Anandpura. ''In addition to the Ryanair, KLM and AEROFLOT orders, we expect further business will result from the meetings held last week in Seattle.''

Manufactured by e.Digital Corporation for APS, the digEplayer 5500 features the latest technology licensed from e.Digital (MicroOS(TM) and engineering) and DivX (compression).

About e.Digital Corporation: e.Digital Corporation partners with leading original design and equipment manufacturers (ODMs/OEMs) licensing, designing and providing manufacturing services for ODM/OEM-branded digital video, digital audio and wireless products based on the company's proprietary MicroOS(TM)-enabled technology platforms. e.Digital specializes in the delivery and management of open and secure digital content through it's personal video, personal audio, automotive, and wireless technology platforms. e.Digital's services include the licensing of the company's MicroOS(TM), custom software and hardware development, industrial design, and manufacturing services through the company's manufacturing partners. For more information about e.Digital and its proprietary technology platforms, please visit the company website at www.edigital.com.

About APS: APS is a privately held company based in Tacoma, Wash., which specializes in innovative technology for the airline industry. The digEplayer 5500(TM) is an example of the industry-changing products offered by APS as the company looks into the future of the transportation and leisure industries. For more information about the digEplayer 5500(TM), contact APS at (253) 284-4445 or visit www.digeplayer.com.

Safe Harbor Statement under the Private Securities Litigation Reform of 1995: All statements made in this document, other than statements of historical fact, are forward-looking statements. Forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and forecasts about the businesses of the Company and the industries and markets in which the company operates. Those statements are not guarantees of future performance and involve risks, uncertainties and assumptions that will be difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied by those forward-looking statements. More information about potential factors that could affect the Company can be found in its most recent Form 10-K, Form 10-Q and other reports and statements filed by e.Digital Corporation with the Securities and Exchange Commission (''SEC''). e.Digital Corporation disclaims any intent or obligation to update those forward-looking statements, except as otherwise specifically stated by it.

seedie: I think you nailed it...
Your read of the situation pretty much meshes with my own. But, as someone said, we may just be window-lickers on the short bus.

DoP

seediecal: Not Really...
You might be a "luddite" however.
From the tone of your post, though, that's probably not true either. The Luddites were opposed to technological advancement.
Like myself, understanding this stuff can be extremely difficult. With all due respect, that just makes us idiots!

DoP

Tenderloin: My experience with the X20 has been terrible.
It plays as poorly as it is built.

DoP

drhunt: I wonder if Maycom got paid for the units they produced? Why would F-10 pay them and not EDIG? If they didn't get paid then I'd be curious as to whether or not they're suing F-10 or taking them to arbitration also.


DoP

Note: This is arbitration...
The leaders of our little company were bright enough to include it in their contracts. No long, drawn out process. Quick and decisive...which means we get our money fast or not at all. Either way it shouldn't cost us much more than we've already spent.

DoP

Just got my DMP-X20...problem...
The FM radio is virtually unusable...the ear buds are equally bad but I knew that already and will purchase something better soon. Anyone else have radio problems?
And yes, the unit is heavy. One could call it solid but so is a paperweight.

DoP

Such a cynic!!! eom

It's pretty clear...
that downloading videos/movies is not far off. Problem is transferring the download to another device for viewing such as your TV set. This is likely at least couple of years away or until someone can virtually guarantee the studios the device output can't be copied.
Until that day arrives, the applications and demand for digital video players will be limited.

DoP

doni: Rockwell Collins provides IFE service...
to the aviation industry and is working with APS on servicing the equipment (to the best of my knowledge).

DoP

lickily: My understanding...
and I questioned Robert on this more than once was that the exclusive APS enjoyed was for Alaska Airlines only. EDIG is free or an airline is free to go to any vendor. It was in e.Digital's best interest at this time to refer all business to APS but another IFE company apparently could sell the EDIG product. Whether the appearance would change I can't say (my guess is yes) but we definitely own the guts. Are we "free to market the player"? Again, I think we could but would prefer not to. If we happen to bring an application to APS, our share of the revenue would be larger. Each deal is a separate negotiation. It is not e.Digital's intent to market the player. We have neither the time nor the manpower to do it correctly.
It may have been APS' brainchild but my impression is that their control is limited.
Do we need a heavyweight to pick up the product? I don't think so. If the product is good, it will sell itself and with Rockwell in place we have a heavyweight in place to provide service.

DoP

Med.rare: Here...
But first a clarification. My question to RP was about APS' interest in the cruise ship/hotel/hospital use of the DigEplayer since it was my understanding that APS only did planes.

"I just ran the question by Robert. His response was that outside of Alaska Airlines, each DigEplayer application is a seperate negotiation. APS is the preferred vendor for the airline application but is not exclusive. Sharing arrangement is also dictated by who brings the deal to the table.

As far as non-airline applications, the same rules apply. It is certainly easier for other entities (APS for example) to market the video player and leave e.Digital do what they do best. It would also require another entity to service the equipment since Rockwell is limited to the airline industry.

Other items: F-10 issue will be resolved shortly. Either way, F-10's position must be in writing and e.Digital will get paid. Resolved does not mean yes or no. Deal could go either (way).
Gateway's relationship with E-machines should be a positive. It will significantly open up the marketing channels and put product on retailer's shelves.. This, in conjunction with the Microsoft music download service, should give a nice boost to player sales.
Still, it will be dwarfed by the video application. As far as consumer video applications...this is contingent upon the ability for content to leave the 7 inch player for viewing on your $10,000 plasma screen at home. The movie industry is not yet ready to make that leap. DRM is the key."

I might add that the change in management in my view is a major plus for the APS/EDIG relationship. Whether by choice or quiet reluctance Boyer has shown himself to be a wise businessman. He has acknowledged the limits of his capabilities and supplemented his expertise with a skilled and well connected leader.
I still believe everything will play out nicely this year as the revenue stream FINALLY begins to ramp up.

DoP

Med.rare: I got a return call from Robert yesterday.
Whaddaya want to know? (Like I got the answers.)
I posted my convoluted impressions of that call on Agora.

DoP

Tenderloin: "Different clientele" I have to agree.
My first thought regarding this issue was the mind set of the
discount passenger. They're looking for bare bones service at the cheapest price. They shop for bargains by nature so this neutral price response from Ted flyers is to be expected.
I suspect these folks use the free buffet coupons at Atlantic City and won't pay for a beer and a hot dog at Yankee Stadium.
Who can?

DoP

Aiwa "Puck" reminds me of the Beosound 2...eom

owd3: Let me clarify... " no commitment on the part of APS or Alaska Airlines." was my comment, not a direct quote from Robert.
Neither APS nor Alaska Airlines has publicly announced a minimum order commitment. Robert indicated to me that if a lesser number of players were ordered then e.Digital would have to reduce their revenue guidance going forward. They do, though, anticipate sales numbers more in line with the PR's stated potential.
There's no conspiracy or attempt to deceive here. It is what it is. Great potential but no guarantees. Alaska Airlines loves the product but they need to maintain flexibility.


DoP

owd3: I may be wrong here but the contract for additional units is between APS and Alaska Airlines. Therefore, details beyond what was announced publicly is either unknown or under wraps as far as e.Digital is concerned. A maximum number of intended units was mentioned...no minimum. I believe, though, that orders approaching 6000 appears likely.

Now stop being such a sour puss!

DoP

Cassandra: I don't believe the EDIG PR yesterday was meant to be misleading. It simply reiterated info that was publicly released by APS and Alaska Airlines. It was they who were vague .
If anything, Robert and e.Digital have attempted to clarify the deal by providing revenue guidance based upon e.Digital's understanding of the agreement.

DoP

lickily: eh.......never mind.//

Tinroad: Actually, I was referring to glace au four...
that culinary combination of sponge cake, vanilla ice cream and meringue baked to golden perfection.

DoP

Tinroad: I was speaking with Robert recently...
and he indicated that e.Digital's revenue guidance is based upon their interpretation of Alaska's interest going forward. Needless to say they (EDIG) are quite optimistic as well as myself.
In my questioning the wording of the press release,though, he indicated that there is no commitment on the part of APS or Alaska Airlines. Therefore, if the orders ceased to come in e.Digital would lower their guidance accordingly.

DoP

While today's release appears very positive...
it really sheds little light on the financial benefits to be derived from the deal. The 6000 units of additional orders could be the deal's potential going forward. There is no indication from any of the involved parties for a minimum number of units. The release is vague. At this point, subsequent orders could range anywhere from 1 to 6000 units.
The only indication for the likelihood of a larger number is e.Digital's expectation for millions in revenue. Note they used "expect" as opposed to "could". Hopefully, they chose their words carefully.
Still, the wide variance in potential follow-up orders is too large to have much value to investors. The deal at this point is a high ceiling with no floor.
Don't get me wrong. I like what I hear. I just wish it said more.

DoP

Produce up to 6000 units???
That leaves a lot of room between 1001 and 6000. Would have been nice if someone indicated a minimum number of players.

DoP

chiselweed: RE: "sounds like that is deliberate for some reason".
It has to be. e.Digital owns all the rights to the MicrOs operating system while the design for airline applications of the video player is exclusive to Boyer. The software is ours. The hardware, if you will, is his.

DoP

Test//
DoP

Philo: Sorry, I've been an investment advisor for over 25 years and that's what we call the screen we use for security prices. Providing the latest prices to a customer was called a quote.
At least I didn't refer to it as the ticker!
Hope you don't need a new ticker.

DoP

Was there a press releases this A.M.?
I'm getting an indication of news on my quote machine.

DoP

What's the news???

moxa1: I wasn't suggesting that EDIG was...
making the other unit; just that HP would be selling their own branded player.
After 5 years I realize that rank speculation only leads to heartache.

DoP

murgirl: URL
http://money.cnn.com/2004/01/08/technology/hp.reut/

DoP

moxa1: If I understood the press release correctly
HP would be selling Apple iPods along with pre-loaded iTunes software in HP computers. Further, HP would soon introduce their own branded music player.

"Beginning this spring, Palo Alto, Calif.-based HP said it will start delivering its own version of music player, as well as make Apple's popular and easy-to-use iTunes digital music jukebox and online music store available to HP customers."

Bought some more shares on yesterday's drop. I realized that my feelings regarding e.Digital were being influenced more by the recent stock price rather than the company's long-term progress.

DoP

Lickily: The EDIG homepage can't handle...
more than two press releases per day. Maybe there's more! As to whether or not history will repeat itself...who knows. The person responsible, Jo Ann Platt, wasn't around in '03.

DoP

Ipod Mini: Looks like an updated MXP-100/

My 2 cents...
The more I think about it, the more silly this whole issue regarding the battery becomes. Granted, $79 ain't chump change and having the unit serviced by Gateway would be a minor inconvenience every couple of years or so but....
Every few weeks/months I run out of ink for my HP printer and inevitably have no backup refills in my desk. Eventually, I'll make a run over to Staples and pay 50 bucks or so for cartridges. Over two years that really adds up but I don't perceive it as a "problem" with the product. Sometimes it just seems I need something to bitch about when waiting for the next EDIG announcement.
These people are not dumb. We just seem to want to think of them as being stupid when we don't get what we want when we want it.
e.Digital has developed a superb product, at a great price, for a major retailer.
Constructive criticism is extremely important...until it turns to cynicism. Then it's not much fun anymore.

Smile!
Now, where'd I hear that before?

H-N-Y!

DoP

Gateway Tech Service Center Says...
the DMP-X20 is a sealed unit and requires servicing by Gateway for an internal battery replacement. If past the warrantee period, this charge is $79.

DoP

Imagine...Vivaldi's "Four Seasons"...
starting in Winter. Pink Floyd's "Dark Side of the Moon" scrambled.
Album sequence, like chapters in a novel, is critically important.


My wishes to all for a healthy and prosperous new year.
Or is that preposterous?

DoP

sricket: Thanks eom

OT: I'd like to transfer my vinyl recordings...
and audio tapes to an MP3 player. Does anyone know what type of hardware I'd need to covert this analog signal to digital? TIA

DoP

Tin: In a recent discussion with Robert...
he indicated that they were required to either issue or register "the maximum number of shares as the lowest possible price". That's what I thought I heard anyway. Unfortunately, I was distracted at the time and didn't really understand the meaning or implications of this comment.
Since many here have been following these financing/conversion issues more closely than myself perhaps this holds more meaning for them.
Just wanted to pass it along.

DoP

P.S. I also don't believe this issue will be the main thrust of the CC. I'm expecting product info.

Sink: I got the impression from Robert...
that part of the reason for the CC is due to the fact that a number of shareholders had complained about the poor audio quality of the recent SHM broadcast. He also indicated that they needed the additional opportunity to explain the issuance of new shares and to make announcement(s) regarding new development(s) not previously disclosed.

DoP