Sun New Media Provides Update on Progress

July 2 2006

Sun New Media Inc. (OTC Bulletin Board: SNMD), announced today that it has filed SEC Form 10-KSB for the period of October 1, 2005 through March 31, 2006. The Company, which became public through a reverse merger in September 2005, recently changed from a September 30 to a March 31 fiscal reporting period. The financial results for the current period primarily reflect the operations of the acquired company, which Sun New Media divested shortly after the fiscal year end, and costs associated with the development of the new entity.

For the six month period from October 1, 2005 through March 31, 2006 the Company reported total expenses of $16.3 million, which included non-cash charges of $13.9 million for stock-based employee incentive compensation ($9.7 million), convertible note discounts ($2.7 million) and a provision for impairment loss in marketable securities ($1.5 million), and $454,000 of non- recurring charges associated with a divested business. The remaining operating costs for the six-month period of $1.9 million included $436,000 of acquisition related legal and professional fees.

As of March 31, 2006, the Company had $1.4 million in cash and cash equivalents and marketable securities worth $8.1 million. In addition, subsequent to its new fiscal year end, the Company received net proceeds of $8.3 million from the exercise of stock warrants.

"The availability of opportunities that fortify Sun New Media's business model have accelerated its growth momentum. The company's management team and its Board of Directors are effectively pursuing these opportunities in light of the economic potential and synergistic value to the company's goals of building China's leading multi-media marketing, information and transaction services company," said Mr. Ricky Ang, Sun New Media's CEO, commenting on the Company's progress. "The company's chairman, Dr. Bruno Wu, has been assiduously identifying and examining potential acquisitions that aggregate the attributes of a comprehensive, Internet business platform to serve the business communities of China's fastest growing verticals."

Dr. Wu added, "Our executive management and Board of Directors recently approved the adoption of a business model enhancement, which greatly improves the Company's profitability ratios. Going forward, we will only book the net transaction fees as compared to recognizing the gross revenue and associated revenue costs. This modification is reflective of the highly profitable business model we have been developing over the past nine months that are expected to generate superior margins and return on assets."

The following summarizes Sun New Media's progress since inception:

09-12-05 Kay Kaplovitz, founder of USA Networks, appointed Vice Chairman

of the Board of Directors.

09-12-05 John Zongyang, Vice-Chairman and Chief Investment Officer of

Sun Media Investment Holding, appointed to Board of Directors.

10-17-05 Company launched the interactive content platform, FM 365, for

consumer products companies and their distributors and channel

partners.

11-29-05 Signed letter of intent with Broadcast International, a leading

provider of video-powered business solutions, to implement its

compression technology (CodecSys) across Sun New Media's

various distribution networks in China. The CodecSys

compression technology enables delivery of video with less

bandwidth and high clarity.

01-03-06 Completed initial financing, raising gross proceeds of $1.0

million. Sun New Media issued 50,000 shares of common stock

and a $918,000 note convertible into common stock. The Company

also issued warrants for the purchase of an aggregate of 11

million shares of common stock at exercise prices ranging from

$2.04 to $4.80 per share, with a weighted average price of

approximately $3.71 per share which, if exercised in full,

would yield proceeds of approximately $40.8 million.

Follow-up convertible note financing of $1.9 million occurred

on March 7, 2006, in which Sun New Media issued 50,000 shares

of common stock and warrants to purchase four million shares of

common stock for $2.10 per share.

01-15-06 Appointed Dr. Herbert Kloiber, Chairman and majority

shareholder of Tele-Munchen Gruppe, to its Board of Directors

01-17-06 Appointed Yu Bing, Executive Vice President of Lenovo

Computers, to its Board of Directors

01-27-06 SNMD acquired Focus Channel Development, one of China's leading

developers of Internet-based channel management software

solutions, controlling a cutting-edge proprietary ASP platform

and a growing list of customers that include some of Asia's

largest consumer products companies. Focus reported gross

revenues of $30.2 million and net profits of $1.9 million for

the fourth quarter ended December 31, 2005. Focus generated

gross revenues of $28.6 million and net profits of $2.9 million

for the first three months of 2006, ending March 31, 2006.

02-15-06 Acquired 100% of the issued and outstanding shares of Sun New

Media Holdings Limited, which owns an 85% stake in Sun 365

Multimedia Holdings Ltd, a Beijing based television and

multimedia production company, a 51% stake in Compass

Multimedia Ltd. (Hong Kong), the creator and distributor of the

Gogosun e-publishing platform and China's first digital TV

Guide, and a 30% stake in Global Woman Multimedia Co. Ltd.

03-01-06 Appointed Ricky Ang Gee Hing as CEO and Frank Zhao as CFO.

03-10-06 Acquired Magzone Asia Pte. Ltd., a leading producer of digital

conversion and distribution technologies for print publishers,

which holds the e-publishing distribution rights for 647

publications in the People's Republic of China. The technology

includes an integrated imaging platform that consists of

advanced optical scanning, image processing, compression,

database management, and web publishing technologies. Together,

the technologies form one of the most cost-effective and

efficient digital conversion platforms in the market.

06-28-06 John Zongyang Li resigns as a member of the Board of Directors.

06-28-06 Appointed CEO Ricky Ang Gee Hing to its Board of Directors.

SUBSEQUENT DEVELOPMENTS

Sun New Media Adds Giant Credit Database to Its Business Transaction Platform Capabilities

(June 14, 2006) Sun New Media agreed to purchase Credit Network 114, Ltd. from Sun Media Investment Holdings for US $2.5 million. The acquisition will deliver to SNMD the largest business credit database in China, with information compiled on over 17 million member companies representing 93 industries in 31 provinces, cities and autonomous regions in China. In a supplementary agreement, SNMD also acquired a state-of-the-art search engine technology and on-line business media content including exclusive authorization by Dragon List for its on-line Music Sales Report and Music Radio Report, an exclusive authorization by the Ministry of Culture and China Audio and Video Press for the release of on-line CVA News, and exclusive authorization by Information Office of State Council and China Media Report for the release of China Website Newsletter. An independent valuation of Credit 114 has determined the value of the entity to be in excess of the purchase price.

Sun New Media enters luxury apparel vertical

(June 8, 2006) Sun New Media announced entry into its fourth business vertical, the $53 billion China luxury apparel market, through an agreement to purchase William Brand Administer, Ltd. ("William Brand"), a China-based producer and distributor of women's luxury apparel. The agreement guarantees a minimum, three-year cooperative distribution agreement with Shanghai First Department Store, China's largest retail group with access to a minimum network of 3,000 wholesalers and department stores within mainland China. Sun New Media intends to purchase William Brands with the issuance of 4,655,172 shares of Sun New Media common stock, distributed in four installments, with the understanding that William Brand must generate minimum revenue and profitability targets, the net effect of which would add $0.025 to Sun New Media's earnings per share during the first full year of operations. This acquisition joins William Brand's nationwide legacy distribution system with the margin enhancing suite of channel management and marketing services offered by Sun New Media.

Sun New Media to enter its third business vertical -- Electronic Parts

(May 23, 2006) Sun New Media announced entry into the electronic parts business vertical, a highly fragmented, $50 billion industry in China. Pending the approval by the State Asset Management Commission of the People's Republic of China, Sun New Media has agreed to purchase 80 percent of Beijing Trans Global Logistics ("BTGL"), a State-owned electronic component trading/logistics enterprise, and with it, a 64 percent equity stake in Beijing CEAC Trans Global Logistics ("BCTGL") for approximately $2.0 million, of which $1.1 million will be paid in cash and the balance in 138,066 shares of Sun New Media common stock. Achieving minimum revenue and profit margin goals for the first three years will result in BTGL receiving an additional 138,066 bonus shares in each of the first three years, for an aggregate 552,264 shares.

Additionally, Sun New Media has signed a strategic cooperative agreement with China Electronic Appliances Corporation ("CEAC"), a subsidiary of State- owned China Electronics Corporation and one of China's top logistic companies with 13 subsidiaries and a nationwide service network. CEAC has agreed to generate business for BCTGL for the first three years of at least $50.0 million in the first year, $56.2 million in the second year, and $62.5 million in the third year. CEAC will transfer a number of its major customers to BCTGL and set-up digital marketing platform using BCTGL software to enable the on- line parts sales. BCTGL has been granted exclusive rights to China's leading electronics on-line magazine, China Electronic Market Intelligence. CEAC intends to sign an exclusive agreement with BCTGL to provide it with an e- publishing catalogue and access to the Electronic Enterprise Association database with information on over 10,000 buyers of electronic components in the country. Sun New Media expects to begin booking revenue from the electronic parts vertical during its third fiscal quarter (ending December 31, 2006) of fiscal 2007. This new vertical is expected to add approximately $0.02 to Sun New Media earnings per share during its first full year of operation.

Sun New Media acquired assets from Sun Media Investment Holdings Ltd.

(April 20, 2006) Sun New Media agreed to purchase various assets, including real estate, automobiles, office equipment and program rights, as well as approximately 48.6 million shares in Asia Premium Television Group for a total consideration of $3.4 million, which was satisfied by the issuance of 860,647 shares of Sun New Media common stock.

Sun New Media divested 100% of its legacy brokerage business

(April 20, 2006) SNMD divested 100% of its legacy brokerage business, Global American Investments Inc., acquired during the Company's reverse merger for $40,000 in cash.

Sun New Media acquired e-publishing rights from Sun Business Network Ltd

(April 20, 2006) Sun New Media acquired exclusive, perpetual online publishing rights to certain magazines, a group of property holdings in Beijing and 53,000,000 shares of ordinary common stock of Asia Premium Television Group, Inc. The consideration paid by the Company for the acquisition was satisfied through the issuance of 8,056,303 shares of the Company's common stock. The terms of the Purchase Agreement also provided that the Company issue an additional 6,900,000 shares of its common stock if the audited net profits (after tax) of the online publishing business are at least $2.415 million for the twelve months commencing January 1, 2006. In the event that the audited net profits after tax are less than the targeted amount, Sun Business Network Ltd is required to either deliver to the Company the cash value of the shortfall to receive the additional shares or forfeit its rights to receive the additional shares.

Sun New Media added three new members to its Board of Directors

During May 2006, Sun New Media added the following individuals to its Board of Directors:

Mark Newburg, a skilled global executive with 30 years of high level experience in both financial management and operations with Fortune 100 companies, as well as emerging companies, within the computer hardware and software, telecommunications, consumer products, and gaming industries. Mr. Newburg is currently President and Chief Executive Officer of VendingData(TM) Corporation, a designer and (China-based) manufacturer of security and productivity enhancing products and services to the gaming industry. Mr. Newburg joined VendingData(TM) in 2005 and quickly revitalized the company by completely overhauling all operations, stabilizing finances, re-engineering existing product lines, and adding new management and new (patent-protected) products. Prior to VendingData(TM), Mr. Newburg spent 26 years with NCR, beginning as an International Tax Administrator in 1981 and ultimately becoming concurrently Chairman of NCR Japan and Vice President, Asia Pacific, managing a staff of 575, and directing the sales and service of all NCR's Financial System Division's products across 12 countries in Asia, Pacific and Japan. Mr. Newburg was also appointed Chairman of Sun New Media's Board of Director's audit committee.

Mr. William Adamopoulos, one of the leading figures in Asian business media. Mr. Adamopoulos is currently the President and Publisher of Forbes Asia. Since joining Forbes as Managing Director in 1999, Mr. Adamopoulos has built up the Forbes business and brand across the region -- including the establishment of a regional headquarters, an Asian printing operation; the annual Forbes Global CEO Conference, new local language editions and building Forbes Asia circulation to 80,000. Prior to joining Forbes, Mr. Adamopoulos was Publisher and Managing Director of The Asian Wall Street Journal in Hong Kong. He has also held the positions of President of Dow Jones Publishing Company (Asia), President of Dow Jones Printing Company (Asia), Managing Director of Dow Jones Interactive (Asia) and Chairman of the Dow Jones Asia Regional Committee. He is a graduate of Harvard University.

Mr. Yang Qi, founder and chairman of Focus Channel Development (HK), Ltd., a leading sales force and channel management services company that was recently acquired by Sun New Media, bringing two decades of operational experience to Sun New Media's board. Through his work in high-level positions within China's real estate, channel management, and distribution network software solutions industries, Mr. Yang Qi has been widely recognized for taking a leading role in consolidating and modernizing consumer product distribution networks across central China.

Mr. Ricky Ang Gee Hing, CEO of Sun New Media and founder of the Sun Business Network Limited ("SBN"). Mr. Ang brings close to 30 years of experience in Asian media and publishing to SNMI. Before founding SBN in 1994, Mr. Ang was CEO of HB Media Holdings, a media company he helped established in early 1993. Before that, he was Senior Vice President at Times Publishing Limited. A graduate of London's College of Printing, Mr. Ang has been in the printing and publishing industry for more than three decades, and was for several years Chairman of the TDB-sponsored, Printing and Publishing Advisory Council in Singapore.

CONFERENCE CALL

Sun New Media has scheduled a conference call to discuss its financial results with the investment community:

Conference Call Details:

Date/Time: Friday, June 30, 2006-10:00 a.m. (EDT)

Telephone Number: 888-214-7562

International Dial-In Number: 415-537-1802

Internet Access: http://www.sunnewmedia.net

It is recommended that participants phone-in at least 10 minutes before the call is scheduled to begin. A replay of the conference call in its entirety will be available approximately one hour after its completion for 14 days by dialing 800-633-8284 (U.S.) or 402-977-9140 (International) and entering the pass code 21297689 on the Internet at http://www.sunnewmedia.net.

About Sun New Media Inc.

Sun New Media is China's leading business focused multi-media marketing and channel management company, leveraging the combined powers of interactive marketing, information and e-transaction. Sun New Media builds e-enabled distribution systems, transaction platforms and business communities in China's fastest growing verticals, connecting corporate buyers and sellers with a suite of turnkey digital media, e-commerce, and information management solutions. Companies leverage Sun New Media's web-based business media communities to access vital industrial intelligence and forge trading relationships with suppliers and buyers that promote cost efficiencies and increased distribution reach. Visit the Sun New Media Web site at http://www.sunnewmedia.net.

This press release includes statements that may constitute "forward- looking" statements, usually containing the word "believe," "estimate," "project," "expect" "plan" "anticipate" or similar expressions, including statements regarding future financial performance. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of Sun New Media's product and services in the marketplace, competitive factors, changes in regulatory environments, and other risks detailed in Sun New Media's periodic report filings with the Securities and Exchange Commission. In addition, there is no certainty that New Media will be able to benefit from the described transactions in the manner currently expected. By making these forward-looking statements, Sun New Media disclaims any obligation to update these statements for revisions or changes after the date of this release.

SUN NEW MEDIA INC.

CONSOLIDATED BALANCE SHEET

As of March 31, 2006 and September 30, 2005

As of As of

March 31, September 30,

2006 2005 (1)

US$ US$

ASSETS

Current Assets

Cash and bank balances 1,373,715 201,957

Accounts receivable, net of provision

for doubtful debts $72,046 (2005: Nil) 415,735 6,277

Other receivable, prepayments and

deposits 466,396 24,859

Inventories 85,346 -

Marketable securities 8,140,377 -

Amounts due from stockholders 292,106 150,446

Amounts due from related parties 892,699 -

Total current assets 11,666,374 383,539

Investment in associated company 24,987 -

Goodwill and intangible assets 61,794,537 -

Plant and equipment 2,205,536 5,554

Clearing broker deposit 36,980 36,980

Total Assets 75,728,414 426,073

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

Accounts payable 987,238 71,204

Other payables and accruals 6,928,098 38,526

Amounts due to related parties 489,122 -

Factoring loan 233,043 -

Total current liabilities 8,637,501 109,730

Convertible notes 2,816,000 -

Discount on warrants (2,393,052) -

Commitments and Contingencies

STOCKHOLDERS' EQUITY

Common stock; authorized 750,000,000

shares, US$0.01 par value

Preference stock, authorized 250,000,000

shares, US$0.01 par value

84,055,510 (2005: 9,259,370) shares of

common stock issued and outstanding,

US$0.01 par value 840,555 92,594

14,537,253 (2005: 55,250,000) shares of

common stock reserved to be issued,

US$0.01 par value 145,372 552,500

Additional paid in capital 81,942,502 5,250

Foreign currency translation adjustments 1,920 -

Deficit (16,160,864) (334,001)

Minority interest (101,520) -

Total stockholders' equity 66,667,965 316,343

Total liabilities and stockholder's

equity 75,728,414 426,073

(1) Information for the comparative period is not applicable since the

Company commenced its operations on June 6, 2005.

SUN NEW MEDIA INC.

CONSOLIDATED STATEMENT OF OPERATIONS

For the periods ended March 31, 2006 and September 30, 2005

Period from Period from

October 1, June 6,

2005 to 2005 to

March 31, September 30,

2006 2005 (1)

US$ US$

REVENUES 402,173 27,358

Direct costs 245,063 18,723

157,110 8,635

OPERATING EXPENSES

General and administrative 1,129,847 16,938

Depreciation and amortization 6,767 -

Finders' fee - 55,000

Stock-based compensation 9,654,099 -

Consulting and professional fees 988,772 32,638

Impairment loss on marketable

securities 1,456,221 -

Total operating expenses 13,235,706 104,576

Operating loss (13,078,596) (95,941)

Interest income 637 -

Interest expense, BCF (2,676,441) -

Interest expense, warrant valuation (110,053) -

Other income 37,590 -

Loss before income tax (15,826,863) (95,941)

Income tax expenses - -

Net loss (15,826,863) (95,941)

Earnings per share:

Weighted average number of shares

outstanding

Basic and diluted 72,809,160 15,398,259

Net loss per share of common stock

Basic and diluted (0.22) (0.01)

(1) Information for the comparative period is not applicable since the

Company commenced its operations on June 6, 2005.

Contact: Ricky Ang

Chief Executive Officer

Sun New Media Inc.

Yvonne L. Zappulla

Managing Director

Wall Street Consultants Corp.

212-681-4108

Yvonne@WallStreetIR.com