The Orchard and ZTE StrikeLandmark Alliance

NEW YORK & SHENZHEN, China & CANNES, France--(BUSINESS WIRE)--The Orchard (NASDAQ: ORCD), a global leader in digital music and entertainment, and ZTE, based in Shenzhen, China, a leading global provider of telecommunications equipment, network and mobile solutions, today announced, at the MIDEM conference in Cannes, a strategic partnership that will further strengthen The Orchard's already significant global distribution reach and provide ZTE and its partner companies in China and internationally access to The Orchard's substantial catalogue of independent music.

“ZTE offers a wide range of innovative products and customized services to major global mobile operators”

Under the deal, The Orchard and ZTE subsidiary, ZTE Mobile Tech Co Ltd (ZTEMT), will jointly develop marketing programs and content bundles to bring The Orchard's diverse international repertoire to ZTEMT's domestic partners, including China Mobile, China Unicom and China Telecom, as well as providing a wide range of music to ZTE's expanding international customer base.

Commenting on the alliance, Regan Lee, Director of Value-added Services, ZTEMT, said "The Orchard is a leading digital music distributor and marketer, representing a large catalogue of independent music. ZTE’s comprehensive value-added services product, Anyservice, has been adopted in 50 countries and provides services for more than 60 carriers worldwide. The cooperation between ZTE and The Orchard, which brings digital music content and telecom technologies together, will significantly develop and optimize the business chain of digital music. With the addition of The Orchard, ZTE will be able to provide telecom operators and mobile service users with extensive digital music services, creating an all-win situation for all parties involved".

ZTE, which delivered 30 million mobile handsets globally during 2007, covering GSM, CDMA and 3G standards, is adding a comprehensive suite of applications, including music downloading and playing features to their mobile handset product range, such as those offered with their recently launched i626 model. In addition, ZTE's Anyservice offering, which supports music features such as color ring back tones, has been adopted by a number of international carriers including SingTel and Telemobil (Romania), Sotel (Kyrgyzstan), Penta Mobile (Czech Republic), Algeria Mobile Mobilis, Libyana (Libya), OTE (Greece) and Etisalat (UAE). The offering will enable The Orchard's catalogue to be accessed by the significant numbers of mobile users and telecom operators served by ZTE in these and other emerging and rapidly expanding telecom markets.

"ZTE offers a wide range of innovative products and customized services to major global mobile operators,” commented Greg Scholl, President and Chief Executive of The Orchard. "ZTE's strength in the domestic Chinese market, as well as in many high-growth, emerging markets, offers Orchard's artists and labels access to a vast and diverse customer base. This partnership harnesses Orchard's strength as a digital innovator in the merchandising, promotion and sale of music, and especially international music, much of which has been previously unavailable."

About ZTE

ZTE is a leading global provider of telecommunications equipment and network solutions, covering virtually every sector of the wireline, wireless, terminal and service markets throughout the world.

ZTE commits around 10% of its annual turnover to research and development and takes a leading role in a wide range of international bodies developing emerging telecoms standards. It is China's only listed telecom manufacturer, with shares publicly traded on both the Hong Kong and Shenzhen Stock Exchanges. ZTE was the only Chinese IT and telecoms manufacturer listed in Business Week 2005's Information Technology 100 and was also included in Business Week's 2006 ranking of China's Top 20 Brands. ZTE offers its customers a unique range of services. The company delivers innovative, custom-made products and services to major operators in the world, helping them to achieve continued revenue growth and to shape the future of the world's communications. ZTE has 15 research and development institutes in China, USA, Sweden, India, Pakistan and France. The company has set up a complete human resources management system for recruitment, training, appointment and employee motivation. ZTE has achieved fast market share growth at home and abroad and a considerable proportion of ZTE's growth is now coming from the international market. The company has established partnerships with over 500 operators in more than 120 countries around the world.

About ZTEMT

ZTE Mobile Tech Co., Ltd. (ZTEMT), a company of the ZTE Corporation, provides R&D, production, sales and after-sales services. Its marketing and sales network and customer service network cover the entire region of China, and its terminal products are sold to over 50 countries and regions in Europe, America, Africa and Asia. ZTEMT has more than 600 employees, of which 70% are engaged in R&D and technical support. With its excellent management team and strong technical expertise, ZTEMT is taking the lead in R&D of mobile communication terminals in the industry. ZTEMT specializes in CDMA fixed wireless terminal (FWT), CDMA digital mobile terminal, CDMA wireless data terminal, CDMA module and GSM terminal series. In 2006, its sales volume reached 1.2 billion yuan RMB, and the delivered quantity exceeded 2.5 million units. The 450MHz CDMA FWTs and handsets have been sold in nearly 50 countries in Asia, Africa, Latin America, Europe and America. The wireless data card has become a leading product in both Chinese and foreign markets.

With ZTEMT's advanced wireless telecom technology, scientific management scheme and win-win spirit instilled in its corporate culture, ZTEMT is determined to meet any market demands. Under the global brand of "ZTE", ZTEMT is ready to meet any challenge, to establish an excellent enterprise, to provide excellent service to its customers, and to create a bright future for wireless telecom industry with its partners everywhere.

About The Orchard^®

The Orchard (NASDAQ: ORCD) controls and globally distributes more than one million songs and over 4,000 hours of video programming through hundreds of digital stores (e.g. iTunes, eMusic, Google, Netflix) and mobile carriers (e.g. Verizon, Vodafone, Bell Canada, Moderati, 3). With operations in 28 countries, The Orchard drives sales for its label, retailer, brand, and agency clients through innovative marketing and promotional campaigns; brand entertainment programs; and film, advertising, gaming and television licensing. A pioneer in digital music and media services, The Orchard fosters creativity and independence.

The Orchard is the trade name for Digital Music Group, Inc (DMGI), the registrant. On November 13, 2007, The Orchard Enterprises Inc. became a wholly-owned subsidiary of DMGI. The Orchard is a registered trademark and The Orchard logo is a service mark of The Orchard Enterprises Inc. All Rights Reserved.

Forward Looking Statements

This release contains certain forward-looking statements, which reflect management’s expectations regarding future events and operating performance, such as statements regarding planned products, new distribution opportunities and anticipated consumer reach. Undue reliance should not be placed on such forward-looking statements as they speak only as of the date hereof, and The Orchard undertakes no obligation to update these statements to reflect subsequent events or circumstances except as may be required by law. These forward-looking statements involve a number of risks and uncertainties. The factors that could cause actual results to differ materially from our expectations are detailed in The Orchard's filings with the Securities and Exchange Commission, such as its annual and quarterly reports.