Sent: Thursday, October 06, 2011 9:21 AM
To: Fred Falk
Subject: Nunchi

Hi Fred,
Can you tell me where the hold up is with regard to the Nunchi project?
Is it a technical one or is there a problem getting in touch with those entities
needed for partnership? Are they just not interested? Is Nunchi currently
being tested by other entities that are partnering prospects?

When is a viable Nunchi product going to be seen in the retail sector? Months,
years ???
Thanks,

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Dean,

There is no hold up and there are no problems. You're thinking of product
development where you have a simple process/schedule to follow. Nunchi is
a new technology. So, unlike a software "app" or widget, we have to cross
unique technical hurdles which is the normal course of business for new
technology development. We do, of course, have incremental internal
schedules for our portions of the innovation.

Recall that we've made it clear that e.Digital is not in a position to deploy
a system actively servicing subscribers of one or more wireless carriers
(that's millions of users streaming data to us). We are looking for partners
to share in the effort. As we've said publicly, we are talking to potential
partners but I also pointed out at the shareholders meeting that given the
current world economic climate, nobody is going to freely pull out their
checkbook. These are different times. Therefore, I cannot give you a
schedule (as we cannot control the schedule) but, I will say that we've made
good progress and we are being well received. As we also indicated at the
shareholders meeting.

Fred
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