HandHeld Entertainment™, Inc. (NASDAQ:ZVUE), a leading global digital entertainment company, today announced it has entered a strategic partnership with ScanScout, whose technology dramatically expands video advertising opportunities for advertisers and publishers. As a result of the agreement, HandHeld will begin to provide contextually relevant overlay video ads within video clips across its online video network: ZVUE Networks™.

ScanScout's proprietary content matching technology should increase HandHeld's ability to monetize its Web site traffic by automatically matching relevant ads with ZVUE Networks' commercial and user-generated content (UGC) in a manner similar to the overlay advertising video ads recently launched by YouTube. Additionally, ScanScout's unique Brand Protector™ software goes one step further to also assure that advertisers' brands will only be associated with the most relevant and appropriate content featured on ZVUE Networks.

"Our implementation of ScanScout represents a significant step toward our goal of providing comprehensive advertising solutions that can be seamlessly deployed across ZVUE Networks," said Jeff Oscodar, president and CEO of HandHeld Entertainment. "ScanScout enables our advertisers to take advantage of its highly advanced overlay technology, which assures precise contextual and behaviorally relevant delivery while protecting advertisers' brands through its Brand Protector. These characteristics should create more advertising opportunities, as well as greater targeting, both of which should translate into increased advertising revenue for HandHeld."

With HandHeld's acquisition of eBaum's World slated to close in mid-October, ZVUE Networks will become one of the largest online video sources in the world, attracting more than 24 million unique visitors per month and delivering 3.5 billion page views annually. According to Oscodar, the eBaum's audience is extremely engaged as supported by a March report from Merrill Lynch that showed eBaum's World ranked second among all UGC Web sites in average time on site per user. Additionally, a highly valued component of ZVUE Networks is its high concentration of 18- to 34-year-old males who are loyal, repeat visitors and who comprise one of the most sought after demographic targets in advertising.

"ScanScout's Brand Protector is a key component to our overall ZVUE Networks strategy, because it delivers the right branding and positioning message alongside the right type of online videos," Oscodar explained. "We believe this connection between advertising and content will both improve our users' online experience and increase the efficacy of advertising on ZVUE Networks."

ScanScout is the first company to offer advertisers and user-generated content providers brand protection thus embracing the marketing opportunities UGC offers. The company's Brand Protector service - the only one of its kind in any media - is the most advanced technology ever devised to analyze online video content and determine if a video is an appropriate match for an advertiser's brand before serving the ad.

"Those UGC publishers who have joined our network are finding that simple and brief integrations can drive numerous rewards," said Doug McFarland, ScanScout's CEO. "We're excited to team with HandHeld's ZVUE Networks, one of the largest and best-regarded UGC publishers in the world. We look forward to helping them increase the revenue generated from their commercial and UGC content with the kind of invitation-only methods that have proven so effective elsewhere on the web."

About HandHeld Entertainment, Inc.
HandHeld Entertainment (NASDAQ:ZVUE) is a global digital entertainment company. Its ZVUE Networks (comprised of Putfile.com™, Holylemon.com™, UnOriginal.co.uk™, YourDailyMedia.com™, Dorks.com™, FunMansion.com™ and ZVUE.com™) now houses more than 850,000 user-generated and commercial videos available for purchase or free viewing, as well as millions of free user-submitted photos and other media. After completing is acquisition of eBaum's World in October 2007, ZVUE Networks is expected to deliver nearly 3.5 billion page views/video streams in 2007. HandHeld's ZVUE™ personal media players are mass-market priced and currently available for purchase online and in more than 2,200 Wal-Mart stores throughout the U.S. For more information, visit http://www.hheld.com/index2.php.

About ScanScout
ScanScout helps digital agencies and publishers maximize their video advertising opportunities by providing technology that delivers far more precise targeting, additional inventory and better results. ScanScout upends the established model of digital video delivery through its sophisticated technology that enables the right creative to be delivered at precisely the right time to the right consumer while also creating additional inventory for the publisher within and around their video content. ScanScout is headquartered in Boston, with offices in New York and San Francisco. For more information, please visit: http://www.scanscout.com.