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ZVUE! Personal Video Player

HandHeld Entertainment Fills Gap in the Portable Entertainment Market With Its ZVUE! Personal Video Player

Portable High-Quality, Full-Color Personal Video Player Is the
First Available at a Consumer-Friendly Retail Price of $99

SAN FRANCISCO, July 8 /PRNewswire/ -- HandHeld Entertainment today announced its ZVUE! personal video player (PVP) -- the first full-color portable digital audio/video player priced at under $100.

Previously code-named "Mockingbird," the ZVUE! will be available at major retailers nationwide in October 2003.

The ZVUE! PVP is designed for and supports content targeted at the "tween" (youth ages 8 to 12), teenage (youth ages 13-19) and early twenty-something (ages 20 to 25) markets. The customer-friendly design of the ZVUE! is similar in size, look and feel to personal digital assistant devices (PDAs) and has an
ultra-bright 2.5-inch (diagonal) full-color screen.

"The portable electronic entertainment market has been waiting a long time for a $99 high-quality personal video player like the ZVUE!," said Nathan Schulhof, president and chief executive officer of HandHeld Entertainment and the credited inventor of the MP3 player. "The market for personal audio devices has been solidified as go-anywhere cassette, CD and MP3 players have demonstrated broad consumer appeal over time. Since portable DVD players have ranged in price from $250 to more than $1,000, until now there has never been a quality portable PVP affordable enough to appeal to the masses -- until the ZVUE!."

Initial licensed content for use with the ZVUE! PVP will include some of the most recognizable branded entertainment names in the world. Various titles will include animated and live-action programs, chart-topping music videos, sports action videos and content from all areas of the entertainment industry.

Content will be available on postage stamp-sized Secure
Digital/MultiMediaCards (SD/MMCs) -- which are becoming the de facto storage media for handheld consumer electronic devices -- and will be priced starting at $7.99. The HandHeld SD/MMCs will be available in sizes ranging from 8 Megabyte (MB) to 256MB capacities and will offer high-quality video playback on ZVUE! PVPs from eight minutes to more than one-and-a-half hours of
uninterrupted full-motion video.

Each ZVUE! PVP will have one SD/MMC slot, a high-performance media-enabled processor, a USB2.0/1.1 (Universal Serial Bus) port, and the ability to play MP3 files. In an effort to keep retail costs down, the ZVUE! will not include internal speakers, but each ZVUE! PVP will include a speaker jack and a pair of ear buds that will produce one of the highest fidelity sounds in a personal entertainment device today. HandHeld has also developed its own compression- decompression algorithm, known as the HHE Codec, to handle real-time video decompression on the ZVUE! processor. ZVUE! PVPs will operate efficiently on four AA batteries to provide approximately eight to 10 hours of
viewing/listening time.

"The ZVUE! PVP has a lot of great features, but what will really 'seal the deal' for buyers will be its full-color screen," Schulhof said. "No other company will ship a full-color personal video player with a screen as large as the ZVUE! for under $100 this Christmas season. And that is why we believe the
ZVUE! will be the perfect gift for active tweens, teenagers and twenty- somethings this holiday season."

Companies interested in discussing relationships with HandHeld
Entertainment should contact the company at its headquarters in San Francisco, California at 415-495-6470 or at the company's Web site at http://www.hheld.com .

Initial evaluation units of the ZVUE! personal video player will begin to be available to accredited journalists beginning in late summer 2003. Interested journalists should contact HandHeld Entertainment's public relations agency, Politis Communications, at 801-523-3730 or at [e-mail]. Digital images of the ZVUE! PVP are available for download at http://hheld.com/news_01.htm or from Politis Communications.

About HandHeld Entertainment

HandHeld Entertainment was formally incorporated in February 2003 to fill the gap in the portable electronic entertainment industry for affordable handheld personal video players (PVPs). Led by an experienced team of seasoned professionals, HandHeld Electronics is also on track to become the foremost provider of personal video media content and the hardware necessary to view
such content.