DMGI Announces New Channel Partnership With mSpot

DMGI Announces New Channel Partnership With mSpot

Deal Adds DMGI TV and Film Content to the mSpot's Mobile Movie Services

SACRAMENTO, Calif., May 17 /PRNewswire-FirstCall/ -- Digital Music Group, Inc. (NASDAQ:DMGI), a content owner and global leader in the digital distribution of independently owned music, television, film and video catalogs, today announced it will begin offering its television and film content through mSpot, a leader in mobile multimedia entertainment.

Mitchell Koulouris, Chief Executive Officer of DMGI, said, "We believe that mobile video is an important potential growth area for DMGI, and we are very pleased to be working with mSpot to make our content available across a number of key North American mobile carriers."

DMGI currently controls the digital distribution rights to more than 4,000 hours of video content, ranging from classic television favorites such as Gumby, I Spy, My Favorite Martian, and The Mr. Bill Show to comedy from Sam Kinison, Andrew Dice Clay, and Jamie Foxx, to contemporary content from superstar illusionist Criss Angel.

mSpot's mobile music, radio, TV and movie services enable carriers to deliver exciting, consumer-centric entertainment to mobile phones. Today, more than one million consumers across North America use mSpot's services to discover, manage, purchase, and enjoy music, live radio, podcasts, videos, and films from the biggest names in entertainment, including Buena Vista VOD, ClearChannel, ESPN, Lionsgate, Marketwatch, Radio Disney and Universal Pictures. mSpot powers entertainment services in the U.S. for Sprint and U.S. Cellular, and in Canada for TELUS and Bell Mobility.

mSpot is the latest in a growing list of digital video services added to the DMGI distribution network that includes Joost, Amazon Unbox, YouTube, the iTunes Store, Google Video, and In2TV, among others. DMGI is planning to make its video catalog available to mSpot starting in the summer of 2007.

For more information on the DMGI video catalog, please visit www.dmgi.com/video/.

About DMGI

Founded in 2005, Digital Music Group Inc. (NASDAQ:DMGI) is a content owner and global leader in the digital distribution of independently owned music and video content. DMGI acquires the digital rights to media catalogs and digitally encodes them into multiple formats for distribution to digital entertainment services operating over the Internet and wireless, cable and mobile networks. Our digital entertainment service partners include: the iTunes Store, Google Video, YouTube, AOL/In2TV, RealNetworks, Napster, Wal-Mart Music, MusicNet, Verizon, Sprint, InfoSpace, Moderati, Zingy, 9 Squared, and many others. For more information, please visit www.dmgi.com.

Digital Music Group is a trademark of Digital Music Group, Inc. Other names mentioned herein are the property of their respective owners.

Forward-Looking Statements

This release contains forward-looking statements (including, without limitation, information regarding DMGI's distribution of videos through digital entertainment services, including mSpot) that involve risks and uncertainties that could cause the results of DMGI to differ materially from management's current expectations. Actual results may differ materially due to a number of factors including, among others: unforeseen difficulties assembling and processing the video content; the market demand for digital video recordings and potential changes in consumers' tastes and preferences in video; and our dependence on digital entertainment services for the distribution and sale of our video content. The matters discussed in this press release also involve risks and uncertainties described in DMGI's most recent filings with the Securities and Exchange Commission, including its Annual Report for 2006 on Form 10-K filed with the SEC on March 30, 2007 and its Quarterly Report on Form 10-Q filed with the SEC on May 14, 2007. Digital Music Group assumes no obligation to update the forward-looking information contained in this release.

Press Contact

Allen & Caron, Inc.: Len Hall, VP Media Relations,
Telephone: (949) 474-4300
e-mail: Len@allencaroncom

Investor Relations Contact

Digital Music Group, Inc.: Karen Davis, Chief Financial Officer,
Telephone: (916) 239-6010 x2505
Allen & Caron Inc.: Jesse Deal, Account Manager,
Telephone: (212) 691-8087,
e-mail: Jesse@allencaron.com

Source: Digital Music Group, Inc.

CONTACT: Press, Len Hall, VP Media Relations, +1-949-474-4300,
Len@allencaroncom, or Investor Relations, Jesse Deal, Account Manager,
+1-212-691-8087, Jesse@allencaron.com, both of Allen & Caron Inc., for Digital
Music Group, Inc.; or Karen Davis, Chief Financial Officer of Digital Music
Group, Inc., +1-916-239-6010, ext. 2505

Web site:

http://www.dmgi.com/video

Web site:

http://www.dmgi.com/

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