X2 debuting 20 consumer electronic gadgets at CES

Los Angeles-Based Serial Entrepreneurs to Develop Innovative Product Line of Digital Entertainment Products; X2 Will Roll Out More than 25 Products by 2005 Consumer Electronics Show

(IRVINE, CA) - X2 Corporation, a global manufacturer and direct marketer of digital convergence products, today announces that it will debut more than 25 cutting -edge consumer electronics products between now and the

2005 Consumer Electronics Show (CES) in January, 2005. X2 represents a revolutionary new business model, reducing time -to -market and inventory control to days, not months, by using a sophisticated supply chain management system to create exactly the products its customers want in near real time, according to Rex Wong, President.

The result, according to Wong, is "like the Dell direct distribution model on steroids." Key to the rapid development and deployment of these products to the market is X2's high -level strategic relationship with Micro -Star International (MSI), a top -tier $2 billion, Taiwan -based manufacturer of computer and consumer electronics hardware, including motherboards, graphic cards and optical storage devices. X2's positioning in the marketplace is to debut and deliver products in the US weeks to months ahead of its competition, and typically at higher price -performance ratios, by leveraging its innovative business model.
"X2's innovative supply chain model is revolutionary and MSI is proud to be a key X2 partner," said Brandon LuTran, Consumer Electronics category manager at MSI.

X2 Set to Debut with More than 25 New CE Products Page Two of Two

"What separates X2 from every consumer electronics company in the world right now is that we can go from market demand projection to shipping final product in as little as two days," said Wong. "Most Asian consumer electronics manufacturers go through two to three tiers of distribution domestically, which slows innovation, adds costs and leads to imprecise demand prediction. We will be able to provide the widest selection of quality digital media products of any manufacturer in the world, with lower prices, consistently high quality and more new features because we can add them in days, as well as make smaller batch orders for specialty products."

X2 plans to offer an array of popular digital media products ranging from Media PC Centers to hybrid MP3 players and pocket video recorder/viewers with innovative features such as Bluetooth and removable SD memory storage. In addition, X2 will offer a variety of LCD televisions, super -thin notebook computers with auto -on playback of DVDs, and PC products for gamers.

X2's products will be available at leading retailers and e -tailers, which will be announced shortly. In addition, X2 will allow select retailers to offer its products through a customized, etailer -like model where the retailer carries no inventory risk and gets a customized product delivered within days. Some of the lower -end, standard -feature
MP3 players will also be carried by traditional mass merchandisers.

About X2
X2's mission is to become the premier brand for digital convergence products. The X2 management team, includes seasoned executives from Cisco, General Electric, Google, Vivendi, D -Link and Netgear with over 100 years of combined experience in the IT industry, including extensive relationships with the leading retailers, e -tailers, catalogers and distributors as well as strong partnerships with Asian manufacturers and factories. X2 is located at 8001 Irvine Center Dr., Suite 462, Irvine, CA 92618. For more information, please contact info@x2usa.com.

About MSI
Micro -Star International Co., Ltd (MSI) enjoys a high reputation for its innovations in the construction of Motherboards, Graphics Cards, Optical Storage Devices, Workstations, Servers, Slim PCs, Barebone Systems and IA Products. Since its founding in 1986, MSI has remained at the forefront in providing easy -to -implement, state -of -the -art products and robust computing solutions for its customers. A global company with sales of $1.7 billion in 2002, MSI serves an international network of distributors and OEM customers in the US, Europe, Asia, Africa, Australia, and Latin America. MSI was recently ranked number 22 on Legend Magazine's Top 1000 manufacturing companies in Taiwan and ranked number 85 in the recent BusinessWeek Info Tech 100 report, published in June 2003. For more information please visit www.msicomputer.com.
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X2 Mega Line Product Guide:

1. Mega View: 20GB series Portable Video Media Player (Announced)
* 7 -in -1 device that functions as a video player, personal video recorder, photo viewer, MP3/media player, portable storage device, FM radio and voice recorder
* 20GB hard drive, portable PC data storage, which provides a combination of up to 80 hours of video, 5,000 songs, 100,000 digital photos, 640 hours of digital voice
* FM radio recording/ Voice recording
* 5 -inch, backlit TFT display screen
* Interactive video menu
* MPEG -4/DivX video playback
* MP3/ WMA Audio Playback
* Pocket -sized: 119mm(W) x 76mm (D) x 24.5mm(H)
* 240g with battery
* View photo and graphic files in JPEG, GIF, BMP or TIFF formats
PRICE: $399

2. Mega MP3 Line: Portable Personal Storage/ MP3 Players (Announced)
A. Mega Stick 511/ 512:
* 128 -256 MB
* Compact memory stick design
* USB adaptable: storage 1.1
* MP3/WMA Audio Playback
* FM radio
* Voice recorder
PRICE: $59 -79

B. Mega Stick 2 520:
* 256 MB built in flash memory
* 1.4 ounces
* USB 2.0 adaptable
* SRS surround sound effect
* MP3/WMA Audio Playback
* FM radio/tuner
* Voice recorder
* LED mini flashlight
PRICE: $89 for 256MB, $119 for 512MB and $169 for 1GB

C. Mega Sports Player 521:
* 512MB -1GB
* USB 2.0 interface
* SRS surround sound effect
* Water resistant
* Features neoprene sports belt pack, headphones, stopwatch and pedometer
* Personal storage, media player, media card reader
* FM radio
* Voice recorder
* 82mm(W) x 51mm(D) x 15.6 mm(H)
* Li -ion battery
PRICE: $149 for 512MB and $199 for 1GB

3. Mega DJ: Mega Stick/Player (Announced)
* Transmits audio signals for playback on car or portable radio
* allows users to transmit any audio stream from their MP3 player, video player or notebook directly to a car radio, stereo system or boom box using standard FM radio frequencies from 89.1~89.7MHz.
* Cigarette lighter adapter with 2 USB ports/ with a car charger that doubles as a charger for any X2 MEGA MP3 player
* USB host powered and 12V car powered with optional cigarette lighter plug
* 2.5mm headphone jack hooks up to most portable CD or media players
PRICE: Sub $29.95

4. Mega PC: Media Center 865 Series (Announce Dec 14)

5. Super Thin Notebook Series (Announce at CES)

6. Mega Player 522: Portable storage/ MP3 Player with Bluetooth capacity allowing for wireless headphones (Announce at CES)

7. Mega View 566 with SD slot (Announce at CES)

For more information please visit www.x2usa.com or contact Jackie Lacambra (310) 821 -6100 x108 jackie@terpin.com to set up an appointment to speak with President of X2, Rex Wong.

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