e.Digital and EASTECH Announce Licensing Agreement for e.Digital's MicroOS-Based Portable...

Business Editors and High-Tech Writers

SAN DIEGO--(BUSINESS WIRE)--Jan. 3, 2001

Licensing, Development, & Manufacturing Partnership

to Embed e.Digital Design Into Products for Global

Consumer Electronics Customers

e.Digital Corp. (OTC:EDIG),

a global provider of comprehensive digital product development and designs, and EASTECH, a $100 million Asian conglomerate specializing in developing and designing "Sound, Vision and Internet appliance" products for the OEM consumer electronics market, Wednesday announced a royalty-bearing licensing agreement under which EASTECH has licensed e.Digital's MicroOS-based portable jukebox design for use in consumer products to be marketed worldwide by name-brand consumer electronics companies.

MicroCAM(TM), e.Digital's newly-announced compressed audio management tool based on MicroOS(TM), is a key element in this portable, large-capacity hard drive, digital audio recorder/player.

Under the licensing agreement, EASTECH will use e.Digital's portable jukebox design and custom engineering services to bring private-labeled Internet audio jukeboxes to the consumer market in early 2001. EASTECH has established relationships over the past quarter-century with name-brand consumer electronics manufacturers including but not limited to Philips, Sony, Kenwood, Sanyo, Panasonic, Sharp, Hitachi and Pioneer.

"This partnership represents both achievement and opportunity for us," said Fred Falk, president and CEO of e.Digital. "We are pleased to have EASTECH as our latest licensee. They have earned a reputation for introducing new, innovative products with major private label customers, and their manufacturing facilities are second to none. We are very excited about the opportunity to work through them with some of the top companies in the consumer electronics and audio markets worldwide.

"Revenues from this agreement are expected to begin flowing to e.Digital during the current quarter. Custom product development is already under way for well-known, brand name licensees who, through this agreement, are expected to brand and launch products this quarter. As always, we defer to our licensees to issue formal product announcements, pricing, and distribution information."

Mr. Liou, chairman of EASTECH, added, "e.Digital's jukebox design and expertise in digital product development are complementary to our business. Together we can offer our OEM customers advanced solutions for their product development and manufacturing needs. Our customers are interested in the latest digital music technology and in incorporating MicroOS/MicroCAM into their product lines."