VitalStream Holdings Not to Effect Reverse Split by Year End IRVINE, Calif., Dec. 2 /PRNewswire-FirstCall/ -- VitalStream(R) Holdings, Inc. (OTC:VSTH) (BULLETIN BOARD: VSTH) , the parent company of VitalStream, Inc., a global provider of integrated content delivery and streaming media services, said today that it will not effect a reverse split of its common stock in December 2004. The Company's current authorization to enact a reverse split was approved by the Company's shareholders at the Annual Meeting of Shareholders held on June 28, 2004, and expires on December 31, 2004. "The Company has not acted upon the authorization and does not intend to do so prior to its expiration at year-end," said Phillip N. Kaplan, president and chief operating officer. "Based on our continuing revenue growth, including a 51 percent increase in year-over-year revenues in the third quarter, we believe that the Company has a promising future through both growing demand for our products and services, and through strategic M&A opportunities. We are confident that the market will recognize the value of our Company in the months ahead, and we intend to achieve listing on the NASDAQ Small Cap Market or another national exchange in the second quarter of 2005," Kaplan added. About VitalStream, Inc. VitalStream, Inc., a wholly-owned subsidiary of VitalStream Holdings, Inc. (OTC:VSHT) (BULLETIN BOARD: VSHT) , is a global provider of integrated content delivery services that enable businesses to broadcast their digital media and communications to worldwide audiences via the Internet. The Company provides complete solutions, including audio and video streaming, live event broadcasting, media asset management, integrated web hosting and consulting services, that seamlessly integrate with today's leading streaming media technologies. To ensure a worldwide reach, VitalStream engineered its award- winner content delivery network certified for quality delivery in the United States, Europe and Asia. For more information, call 800-254-7554, or visit http://www.vitalstream.com/. Forward-Looking Statements This news release may contain certain "forward-looking statements" within the meaning of Sections 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may vary materially from the expectations contained in the forward-looking statements. Forward-looking statements may include statements addressing future financial and operating results of the company. The following factors, among others, could cause actual results to differ materially from those described in any-forward looking statements: The risk that the Company's revenue may decrease on a year over year basis because of a slower than projected growth in the demand for digital broadcast and streaming services; the risks that the Company's existing customers may cease to use the Company's services and/or may not use the Company's services at the projected rate; uncertainties regarding the future demand for the Company's products and services generally; the risks that the trend toward increasing broadband penetration may not continue; the risk that the Company may not satisfy the minimum bid requirement or other listing requirements for Nasdaq or an exchange or may otherwise be prohibited from listing its common stock; the risk that the Company may not be able to find suitable acquisition or other business combination transactions, or upon completing such transactions, successfully integrate the acquired businesses; the risk that the Company may be unable to obtain additional capital necessary to continue operations and fuel growth or obtain it at favorable rates; and/or uncertainties regarding our ability to pursue our proposed business strategy. More detailed information about these factors and others is set forth in the Company's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Such forward- looking statements speak only as of the date of this release. The Company is under no obligation (and expressly disclaims any obligation) to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Vital Stream is a registered trademark of VitalStream, Inc. All other trademarks are property of their respective holders. For further information please contact Mark Belzowski of VitalStream, Inc., +1-949-743-2000, ; or Neal Rosen of Kalt Rosen & Co. LLC, +1-415-397-2686, , for VitalStream Holdings, Inc. DATASOURCE: VitalStream Holdings, Inc. CONTACT: Mark Belzowski of VitalStream, Inc., +1-949-743-2000, ; or Neal Rosen of Kalt Rosen & Co. LLC, +1-415-397-2686, , for VitalStream Holdings, Inc. Web site: http://www.vitalstream.com/

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