IDC Reports Second Quarter Results: New Products and New Orders

August 31, 2006

Ottawa, ON – August 30, 2006 – – International Datacasting Corporation (TSX:IDC) today announced its unaudited financial results for the second quarter of fiscal 2006/2007.

The results in CDN$ are as follows:

Three months ending
                        July 31, 2006     July 31, 2005
Revenue         $3,363,933     $3,348,537
EBITDA (1)         $125,981         $423,206
Net Earnings     ($212,835)     $291,066
Basic Earnings per share ($0.005)     $0.008

Six months ending
                        July 31, 2006     July 31, 2005
Revenue             $6,640,001     $6,679,511
EBITDA             ($112,553)     $560,535
Net Earnings         ($670,240)     $308,842
Basic Earnings per share ($0.015)         $0.008

Revenues for the second quarter of fiscal 2006/2007 increased slightly from $3.348 million for the same period last year to $3.363 million. The Company ended the quarter with a net loss of $212,835 compared to net earnings of $291,066 for the same period last year. The decrease in net earnings was largely attributable to lower than expected revenues combined with higher selling, general and administrative, tax and amortization costs and a significantly lower US exchange rate. Cash on hand and short term investments were $1.26 million at the end of the quarter, with a total working capital of $1.22 million and unused bank facilities of $1.5 million, subject to the usual margin restrictions.

“Ron Clifton, President and CEO of IDC, commented, “We made some important advances this quarter with first deliveries of our new DVB-S2 products and continued integration of our PROFLine subsidiary in Europe. While revenues were fairly flat compared to last year, our second quarter results improved over first quarter of this year with a return to positive EBITDA, which is important for retaining working capital. Sales for the first half of the year were lower than anticipated and we had some supplier-related delays in shipping new product. We are now seeing an improvement in order backlog and the outlook is improving. Our new products for IPTV, radio networks, digital signage, and interactive distance learning applications are in full production and will contribute positively to our future performance.”

In addition, we had a number of other highlights in the quarter:

- IDC began shipments of our latest DVB-S2 receivers to Access IT for their U.S. digital cinema network.

- IDC launched the next-generation version of our award winning SuperFlex One Touch interactive distance learning product line with low-latency bandwidth-efficient MPEG 4 AVC (H.264 Part 10) streaming video and unparalleled performance.

- We completed testing of our new MPEG 4 HE AAC digital audio decoding products for both live and replay applications, upgraded one major network in the USA and also won initial orders in Europe.

- IDC’s PROFline division received a follow-on order from Radio Maria for the expansion of their European network and has pending agreements with several other European companies.

- PROFline products have been introduced to the international reseller network of IDC and new sales have been made in Canada, Mexico and Japan.

- The next-generation SFX2100 Pro Audio was introduced with its built in MPEG4 HE-AAC decoding as Store & Forward capabilities to an eager group of broadcasters.

- IDC was featured in a CNN report on efforts in Thailand to provide educational opportunities. We are pleased and proud when IDC products are used to implement sustainable business opportunities for people in remote and under-served areas around the world.

- Additionally in Asia, we successfully demonstrated Datacast XD for applications in the exploding IPTV market. The demonstration featured Datacast XD integrated into a consumer set-top-box to implement an IPTV PVR to implement PUSH SVOD (Subscription Video-On-Demand) for the delivery of high definition movies, complete with integrated Digital Rights Management (DRM) intended for IP satellite, telco, fiber-to-the-home and DVB-H markets.

Ron Clifton concluded, “We expect that there will be substantial demand for our new products--especially in DVB-S2—and important opportunities in other vertical markets.”

About International Datacasting Corporation:

IDC (TSX:IDC) provides advanced products, systems, and services for the implementation of broadband wireless infrastructure networks used to distribute multimedia data. IDC is at the forefront of delivering IP-based datacasting solutions via satellite and content distribution technologies. IDC's products are in demand for high-speed Internet infrastructure, enterprise networks, distance learning, broadcast, and other multimedia content distribution applications. IDC is a recipient of numerous awards including the prestigious Canada Export Award for Innovation and Technology Achievement. IDC is headquartered in Ottawa, Canada, and has a European base of operations as PROFline B.V. located in Arnhem, the Netherlands. IDC has an established international network of partners and distributors and installations in more than 75 countries worldwide. Visit IDC on the web at www.datacast.com and www.profline.com.

This press release contains forward-looking statements that may involve risks and uncertainties. Actual results may differ materially. Factors that might cause a difference include, but are not limited to, competitive developments, risks associated with IDC’s growth, the development of the satellite datacasting market, regulatory risks, intellectual property infringement and other factors. IDC assumes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof. More detailed information about potential factors that could affect IDC’s financial and business results is included in the public documents IDC files from time to time with Canadian securities regulatory authorities.

¹Note: Use of non-GAAP Financial Information

Non-GAAP net income is provided to enhance the overall understanding of our current financial performance and our prospects for the future. Specifically, we believe the non-GAAP results provide useful information to both management and investors by excluding specific expenses that we believe are not indicative of our core operating results. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with generally accepted accounting principles.