NEW YORK, -- DAG Media Inc -- On October 11, 2006, we entered into a Stock Purchase Agreement with Mr. Guy Mushkat, the founder and Chief Executive Officer of Shopila Corporation, an e-commerce software developer and the operator of www.shopila.com. Pursuant to the terms of the Stock Agreement, we purchased 80% of the outstanding common shares of Shopila from Mr. Guy Mushkat, in consideration for $100,000 in cash, the issuance of 50,000 restricted shares of our common stock, and an option to purchase 50,000 shares of our Common Stock. In addition, we have replaced Mr. Guy Mushkat's personal guarantee of Shopila's liabilities up to, but not to exceed $90,000. Accordingly the purchase price is approximately $353,000 including liabilities assumed.

Total net loss for the three month period ended September 30, 2006 was $117,000, or $(0.04) per basic and diluted share (based on 3.180 million shares) compared to a net loss of $96,000, or $(0.03) per basic and diluted share (based on 3.120 million shares) for the same period in 2005. Total net loss for the nine month period ended September 30, 2006 was $42,000, or $(0.01) per basic and diluted share (based on 3.156 million shares) compared to a net loss of $299,000, or $(0.10) per basic and diluted share (based on 3.115 million shares) for the same period in 2005.

Loss from operations for the three month period ended September 30, 2006 was $251,000 compared to a loss of $163,000 for the same period in 2005, an increase of $88,000, or 54.0%. This increase is attributable primarily to an increase in Marketing expenses of $41,000 associated with the beginning operation of www.nextyellow.com and an increase in compensation expenses of $37,000 due to the adoption of SFAS 123R effective January 1, 2006.

Net loss from continuing operations for the three month period ended September 30, 2006 was $190,000, or $(0.06) per basic and diluted share (based on 3.180 million shares), compared to a net loss of $58,000, or $(0.02) per basic and diluted share (based on 3.120 million shares), for the same period in 2005. The net loss was attributable to the increase in loss from operations and decrease in other income which was attributable primarily to the fluctuation in performance of the Company's portfolio and marketable securities.

Loss from operations for the nine month period ended September 30, 2006 was $759,000 compared to a loss of $494,000 for the same period in 2005, an increase of $265,000, or 53.6%. This increase is attributable primarily to the increase of web development costs of $125,000 associated with the programming of www.nextyellow.com website, increase in marketing expenses of $57,000 associated with marketing expenses of www.nextyellow.com and an increase in compensation expenses of $118,000 relating to the adoption of SFAS 123R effective January 1, 2006, offset by a decrease in professional fees of $57,000.

Net loss from continuing operations for the nine month period ended September 30, 2006 was $647,000, or $(0.20) per basic and diluted share (based on 3.156 million shares), compared to a net loss of $163,000, or $(0.06) per basic and diluted share (based on 3.115 million shares), for the same period in 2005. The increase was attributable to the increase in loss from operations and decrease in other income which was attributable primarily to the fluctuation in performance of the Company's portfolio and marketable securities.

DAG Media, Inc. (Nasdaq: DAGM), through its subsidiaries DAG Interactive, Inc. and Shopila Corporation is a provider of an innovative solutions to the online yellow pages, local search and e-commerce industries.

This release contains forward-looking statements within the meaning section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements are typically identified by the words "believe," "expect," "intend," "estimate" and similar expressions. Those statements appear in a number of places in this release and include statements regarding our intent, belief or current expectations or those of our directors or officers with respect to, among other things, trends affecting our financial conditions and results of operations and our business and growth strategies. These forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those projected, expressed or implied in the forward-looking statements as a result of various factors (such factors are referred to herein as "Cautionary Statements"), including but not limited to the following: (i) the successful consummation of this acquisition (ii) the successful sale of our directories business; (iii) the success of our new business strategy; (iv) potential acquisitions; (v) our limited operating history; (vi) potential fluctuations in our quarterly operating results; (vii) challenges facing us relating to our growth; and (viii) our dependence on a limited number of suppliers. The accompanying information contained in this release, including the information set forth under "Management's Discussion and Analysis of Financial Condition and Results of Operations," which can be found in our Form 10-QSB filed for the quarter ended September 30, 2006, identifies important factors that could cause such differences. These forward-looking statements speak only as of the date of this release, and we caution potential investors not to place undue reliance on such statements. We undertake no obligation to update or revise any forward-looking statements. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the Cautionary Statements.