Digital Lifestyles Group
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Digital Lifestyles Group taps the AOL® Instant Messenger (AIM®) service to enable hip-e users to connect in real time

hip-e hangout Empowers Teens to Meet Their Need For Instant Communications

AUSTIN, TX – January 5, 2005 – Digital Lifestyles Group, Inc. (OTCBB: DLFG), the creators of hip-e™, the world’s first lifestyle computer and entertainment system designed exclusively for teens, today announced that it has formed an agreement with America Online, Inc., the world's leading interactive services company, to offer the AOL® Instant Messenger™ (AIM®) service as an exclusive part of the hip-e hangout interactive user experience on all hip-e nodes and nodebooks. The hip-e hangout, an easy-to-use interactive desktop experience designed to meet teens' needs, now also gives teens instant access to the AIM® service, including AIM® Games, AIM® Video, the You’ve Got Pictures® digital photo service, video instant messaging, mobile instant messaging, CD-quality radio, and more. 

 “Instant messaging is an essential part of every teen’s digital lifestyle needs. Delivering the AIM service through the hip-e hangout results in a relevant, interactive and easy way for teens to connect with their family and friends,” said Erik Smith, vice president of business development and programming at Digital Lifestyles Group. “And by including an AIM “hot key” button on the keyboard, teens will gain direct access to AOL’s popular instant messaging service.”

 The all-in-one hip-e node is a perfect entertainment and communication center for a teen’s room. The node comes bundled with the hip-e hangout, delivering a simple, fun, relevant and customizable experience, with safety features, for instant messaging, music and videos, television and movies, online shopping, homework help, and more.

 “Instant messaging with friends and family is an integral part of daily life for teens,” said Chamath Palihapitiya, vice president and general manager, AOL Instant Messenger and ICQ services, America Online, Inc. “We are very excited to be working with the Digital Lifestyles Group to help hip-e users connect with the AIM network to make new friends, or meet up with old ones to talk via text and video message, play games, share pictures, and more." 

 The hip-e digital lifestyle computer and entertainment system can be ordered at www.hip-e.com, or by calling 1-877-hip-e4me.  It is also available on Amazon.com.  AIM users must be of the age of majority in their state of residence to register for the service.

About Digital Lifestyles Group, Inc.

Digital Lifestyles Group, Inc. designs, manufactures and markets digital lifestyle products, including software, personal computers, accessories and entertainment and communication solutions. Our products include hip-e™, the first digital lifestyle computer and entertainment system for teens, and the Northgate® line of desktop and notebook computers for consumer, business and education customers. We sell our products through our online stores (www.hip-e.com, www.northgate.com), direct sales force, third-party resellers and retail stores.  More information about Digital Lifestyles Group is available at www.dig-life.com

Forward-looking Statements

This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to significant risks and uncertainties. Although the Company believes that the expectations reflected in its forward-looking statements are reasonable, the Company can give no assurance that such expectations or any of the forward-looking statements will prove to be correct, and future results may differ materially from those discussed in this press release. Important information regarding the factors that may affect the Company's future performance is included in its public reports that it files with the Securities and Exchange Commission. The Company disclaims any intention or obligation to revise any forward-looking statements, whether as a result of new information, future event, change in expectations, conditions or circumstances, or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The inclusion of any statement in this release does not constitute an admission by the Company or any other person that the events or circumstances described in such statement are material.