UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


**Washington,
      D.C. 20549**







FORM
      10-Q





**(Mark
                One)**
              x
            QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE
                ACT
                OF 1934FOR
                THE PERIOD ENDING JUNE 30, 2008ORo
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE
                ACT
                OF 1934FOR
                THE TRANSITION PERIOD FROM _________TO_________COMMISSION
                FILE NUMBER 0 - 1325










MULTIBAND
      CORPORATION


(Exact
      name of registrant as specified in its charter)





**MINNESOTA**


(State
      or
      other jurisdiction of incorporation or organization)





**41 - 1255001**


(IRS
      Employer Identification No.)





**9449
      Science Center Drive, New Hope, Minnesota 55428**


(Address
      of principal executive offices)





**Telephone
      (763) 504-3000 Fax (763) 504-3060**


**Internet:**  www.multibandusa.com


(Registrant's
      telephone number, facsimile number, and Internet address)





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934
      during the preceding 12 months (or for such shorter period that the
      registrant was required to file such reports), and (2) has been subject to
      such filing requirements for the past 90 days.





Yes x No o





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, a non-accelerated filer or a smaller reporting company.
      See
      the definitions of “large accelerated filer,” “accelerated filer“ and “smaller
      reporting company” in Rule 12b-2 of the Exchange Act. (Check one):





Large
      accelerated filer o Accelerated filer o


Non-accelerated
      filer x (do not
      check if a smaller reporting company) Smaller reporting company o





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).





Yes o No x





On
      August
      7, 2008 there were 9,519,425 shares outstanding of the registrant's common
      stock, no par value, and 302,775 outstanding shares of the registrant's
      convertible preferred stock.













**PART
      I. FINANCIAL INFORMATION**





**ITEM
      1. CONSOLIDATED FINANCIAL STATEMENTS**





**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS**





Three
                Months Ended
            
            Six
                Months EndedJune
                30, 2008
            
            June
                30, 2007
            
            June
                30, 2008
            
            June
                30, 2007(unaudited)
            
            (unaudited)
            
            (unaudited)
            
            (unaudited)**REVENUES**
            
            $
            10,805,707
            
            $
            3,921,726
            
            $
            16,519,936
            
            $
            8,306,681**COSTS
                AND EXPENSES**Cost
                of products and services (exclusive of depreciation and amortization
                shown
                separately below)
            
            
            6,393,571
            
            
            1,871,238
            
            
            10,213,769
            
            
            4,049,284Selling,
                general and administrative
            
            
            2,560,755
            
            
            2,308,426
            
            
            4,416,038
            
            
            4,697,682Depreciation
                and amortization
            
            
            879,055
            
            
            995,068
            
            
            1,616,762
            
            
            2,044,766Impairment
                of assets
            
            
            7,406
            
            
            -
            
            
            65,452
            
            
            -Total
                costs and expenses
            
            
            9,840,787
            
            
            5,174,732
            
            
            16,312,021
            
            
            10,791,732**INCOME
                (LOSS) FROM OPERATIONS**
            
            
            964,920
            
            
            (1,253,006
            )
            
            207,915
            
            
            (2,485,051
            )**OTHER
                EXPENSE**Interest
                expense
            
            
            (113,000
            )
            
            (168,010
            )
            
            (213,659
            )
            
            (321,417
            )Other
                income
            
            
            32,407
            
            
            141,037
            
            
            72,590
            
            
            164,094Total
                other expense
            
            
            (80,593
            )
            
            (26,973
            )
            
            (141,069
            )
            
            (157,323
            )**INCOME
                (LOSS) BEFORE INCOME TAXES AND MINORITY INTEREST IN
                SUBSIDIARY**
            
            
            884,327
            
            
            (1,279,979
            )
            
            66,846
            
            
            (2,642,374
            )**PROVISION
                FOR INCOME TAXES**
            
            
            434,300
            
            
            -
            
            
            462,800
            
            
            -**MINORITY
                INTEREST IN NET INCOME OF SUBSIDIARY**
            
            
            393,586
            
            
            -
            
            
            412,003
            
            
            -**NET
                INCOME (LOSS)**
            
            
            56,441
            
            
            (1,279,979
            )
            
            (807,957
            )
            
            (2,642,374
            )Preferred
                stock dividends
            
            
            103,662
            
            
            120,474
            
            
            3,984,682
            
            
            360,401**LOSS
                ATTRIBUTABLE TO COMMON STOCKHOLDERS**
            
            $
            (47,221
            )
            $
            (1,400,453
            )
            $
            (4,792,639
            )
            $
            (3,002,775
            )**BASIC
                AND DILUTED INCOME (LOSS) PER COMMON SHARE:****NET
                INCOME (LOSS)**
            
            $
            .00
            
            $
            (.20
            )
            $
            (.53
            )
            $
            (.42
            )**LOSS
                ATTRIBUTABLE TO COMMON STOCKHOLDERS**
            
            $
            (.00
            )
            $
            (.20
            )
            $
            (.53
            )
            $
            (.42
            )**WEIGHTED
                AVERAGE SHARES OUTSTANDING – BASIC AND
                DILUTED**
            
            
            9,499,469
            
            
            7,093,071
            
            
            8,998,601
            
            
            7,086,462





See
      notes
      to condensed consolidated financial statements




Page
          1


**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS**





Three
                Months Ended
            
            Six
                Months EndedJune
                30,2008
            
            June
                30,2007
            
            June
                30,2008
            
            June
                30,2007(unaudited)
            
            (unaudited)
            
            (unaudited)
            
            (unaudited)**NET
                INCOME (LOSS)**
            
            $
            56,441
            
            $
            (1,279,979
            )
            $
            (807,957
            )
            $
            (2,642,374
            )**OTHER
                COMPREHENSIVE INCOME (LOSS), NET OF TAX:**Unrealized
                gains(losses) on securities:Unrealized
                holding gains(losses) arising during period
            
            
            (56,991
            )
            
            -
            
            
            151,978
            
            
            -**COMPREHENSIVE
                LOSS**
            
            $
            (550
            )
            $
            (1,279,979
            )
            $
            (655,979
            )
            $
            (2,642,374
            )





See
      notes
      to condensed consolidated financial statements




Page
          2


**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS**




June
                    30,
                  2008
                
                December
                    31,
                  2007(unaudited)
                
                (audited)***ASSETS*****CURRENT
                    ASSETS**Cash
                    and cash equivalents
                
                $
                8,350,877
                
                $
                944,456Accounts
                    receivable, net
                
                
                4,268,381
                
                
                1,560,123Securities
                    available for sale
                
                
                151,978
                
                
                -Inventories
                
                
                1,431,919
                
                
                132,992Prepaid
                    expenses and other
                
                
                736,956
                
                
                135,589Current
                    portion of notes receivable
                
                
                63,766
                
                
                59,861Total
                    Current Assets
                
                
                15,003,877
                
                
                2,833,021**PROPERTY
                    AND EQUIPMENT, NET**
                
                
                1,444,117
                
                
                1,769,261**OTHER
                    ASSETS**Goodwill
                
                
                116,757
                
                
                16,757Intangible
                    assets, net
                
                
                5,775,699
                
                
                4,072,076Notes
                    receivable – long-term, net
                
                
                40,443
                
                
                -Other
                    assets
                
                
                587,468
                
                
                202,314Total
                    Other Assets
                
                
                6,520,367
                
                
                4,291,147**TOTAL
                    ASSETS**
                
                $
                22,968,361
                
                $
                8,893,429***LIABILITIES
                    AND STOCKHOLDERS' EQUITY*****CURRENT
                    LIABILITIES**Mandatory
                    redeemable preferred stock, 18,200 and 22,026 Class F preferred
                    shares
                
                $
                182,000
                
                $
                220,256Current
                    portion of long-term debt
                
                
                1,543,361
                
                
                1,658,342Current
                    portion of capital lease obligations
                
                
                235,983
                
                
                225,291Accounts
                    payable
                
                
                6,968,045
                
                
                2,950,596Accrued
                    liabilities
                
                
                3,157,218
                
                
                2,531,611Customer
                    deposits
                
                
                60,582
                
                
                60,582Deferred
                    service obligations and revenue
                
                
                941,008
                
                
                204,520Total
                    Current Liabilities
                
                
                13,088,197
                
                
                7,851,198**LONG-TERM
                    LIABILITIES**Long-term
                    debt, net
                
                
                2,210,833
                
                
                118,924Capital
                    lease obligations, net of current portion
                
                
                185,411
                
                
                249,469Total
                    Liabilities
                
                
                15,484,441
                
                
                8,219,591**COMMITMENTS
                    AND CONTINGENCIES****MINORITY
                    INTEREST**
                
                
                3,250,163
                
                
                -**STOCKHOLDERS'
                    EQUITY**Cumulative
                    convertible preferred stock, no par value:8%
                    Class A (23,928 and 24,728 shares issued and outstanding, $251,244
                    and
                    $259,644 liquidation preference)
                
                
                359,708
                
                
                371,70810%
                    Class B (3,170 and 3,770 shares issued and outstanding, $33,285
                    and
                    $39,585 liquidation preference)
                
                
                31,700
                
                
                37,70010%
                    Class C (116,580 and 120,250 shares issued and outstanding, $1,165,800
                    and
                    $1,202,500 liquidation preference)
                
                
                1,509,246
                
                
                1,548,35210%
                    Class F (150,000 shares issues and outstanding, $1,500,000 liquidation
                    preference)
                
                
                1,500,000
                
                
                1,500,0008%
                    Class G (11,595 and 26,595 shares issued and outstanding, $115,950
                    and
                    $265,950 liquidation preference)
                
                
                47,970
                
                
                111,4686%
                    Class H (2.0 shares issued and outstanding, $200,000 liquidation
                    preference)
                
                
                -
                
                
                -Variable
                    rate % Class I (0 and 39,500 shares issued and outstanding, $0
                    and
                    $3,950,000 liquidation preference)
                
                
                -
                
                
                -Common
                    stock, no par value (9,528,294 and 7,451,891 shares issued and
                    outstanding)
                
                
                37,457,098
                
                
                29,574,673Stock
                    subscriptions receivable
                
                
                (114,834
                )
                
                (170,888
                )Options
                    and warrants
                
                
                46,234,091
                
                
                45,871,964Accumulated
                    comprehensive income - unrealized gain on securities available
                    for
                    sale
                
                
                151,978
                
                
                -Accumulated
                    deficit
                
                
                (82,943,200
                )
                
                (78,171,139
                )Total
                    Stockholders' Equity
                
                
                4,233,757
                
                
                673,838**TOTAL
                    LIABILITIES AND STOCKHOLDERS' EQUITY**
                
                $
                22,968,361
                
                $
                8,893,429




See
      notes
      to condensed consolidated financial statement




Page
          3





**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS**




Six
                Months EndedJune
                30, 2008
            
            June
                30, 2007(unaudited)
            
            (unaudited)OPERATING
                ACTIVITIESNet
                loss
            
            $
            (807,957
            )
            $
            (2,642,374
            )Adjustments
                to reconcile net loss to net cash flows from operating
                activitiesDepreciation
                and amortization
            
            
            1,616,762
            
            
            2,052,752Minority
                interest in net income of consolidated subsidiary
            
            
            412,003
            
            
            -Impairment
                of intangibles
            
            
            65,452
            
            
            -Amortization
                of original issue discount
            
            
            -
            
            
            16,589Amortization
                of imputed interest discount
            
            
            24,230
            
            
            -Loss(gain)
                on sale of property and equipment and intangible assets
            
            
            58,855
            
            
            (284,516
            )Warrants
                issued for services
            
            
            -
            
            
            42,300Gain
                on debt extinguishment
            
            
            (29,965
            )
            
            (118,040
            )Stock
                based compensation expense
            
            
            362,127
            
            
            391,433Compensation
                expense of restricted stock awards
            
            
            23,625
            
            
            -Change
                in allowance for doubtful accounts on accounts receivable
            
            
            (15,000
            )
            
            (40,000
            )Change
                in reserve for stock subscriptions and interest receivable
            
            
            (6,279
            )
            
            30,000Changes
                in operating assets and liabilities:Accounts
                receivable
            
            
            (66,392
            )
            
            488,075Inventories
            
            
            917,140
            
            
            188,229Prepaid
                expenses and other
            
            
            (592,076
            )
            
            138,403Other
                assets
            
            
            (4,080
            )
            
            (21,638
            )Accounts
                payable and accrued liabilities
            
            
            (1,765,701
            )
            
            (324,974
            )Customer
                deposits
            
            
            -
            
            
            (625
            )Deferred
                service obligations and revenue
            
            
            736,488
            
            
            (414,289
            )Liabilities
                of discontinued operations
            
            
            -
            
            
            (125,000
            )Net
                cash flows from (used by) operating activities
            
            
            929,232
            
            
            (623,675
            )INVESTING
                ACTIVITIESPurchases
                of property and equipment
            
            
            (65,976
            )
            
            (240,881
            )Cash
                acquired via purchase of MMT
            
            
            4,043,942
            
            
            -Cash
                collected on other receivables - related parties acquired via the
                purchase
                of MMT
            
            
            2,815,239
            
            
            -Purchase
                of US Installs
            
            
            (101,000
            )
            
            -Proceeds
                from sale of property and equipment and intangible assets
            
            
            5,695
            
            
            1,174,486Collections
                on notes receivable
            
            
            666
            
            
            4,802Net
                cash flows from investing activities
            
            
            6,698,566
            
            
            938,407FINANCING
                ACTIVITIESChecks
                issued in excess of cash in bank
            
            
            -
            
            
            (319,244
            )Payments
                on long-term debt
            
            
            (34,321
            )
            
            (142,569
            )Payments
                on capital lease obligations
            
            
            (111,717
            )
            
            (121,838
            )Payments
                on note payable to stockholder
            
            
            -
            
            
            (24,739
            )Payments
                on mandatory redeemable preferred stock
            
            
            (38,256
            )
            
            (38,744
            )Payments
                for stock issuance costs
            
            
            (25,379
            )
            
            (11,707
            )Payments
                received on stock subscriptions receivable
            
            
            1,000
            
            
            62Proceeds
                from issuance of long term debt
            
            
            100,000
            
            
            -Redemption
                of preferred stock
            
            
            (50,700
            )
            
            (45,200
            )Preferred
                stock dividends
            
            
            (62,004
            )
            
            (13,578
            )Net
                cash flows used by financing activities
            
            
            (221,377
            )
            
            (717,557
            )INCREASE(DECREASE)
                IN CASH AND CASH EQUIVALENTS
            
            
            7,406,421
            
            
            (402,825
            )CASH
                AND CASH EQUIVALENTSBeginning
                of period
            
            
            944,456
            
            
            1,020,975End
                of period
            
            $
            8,350,877
            
            $
            618,150




See
      notes
      to condensed consolidated financial statements




Page
          4


**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS**




Six
                Months EndedJune
                30, 2008
            
            June
                30, 2007(unaudited)
            
            (unaudited)SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATIONCash
                paid for interest, net of amortization of original issue
                discount
            
            $
            136,231
            
            $
            258,504SUPPLEMENTAL
                DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIESConversion
                of Class I preferred stock into common stock
            
            
            3,744,600
            
            
            -Conversion
                of Class G preferred stock into common stock
            
            
            150,000
            
            
            -Conversion
                of accrued interest into common stock
            
            
            2,000
            
            
            15,680Conversion
                of accrued dividends into common stock
            
            
            175,412
            
            
            474,291Intrinsic
                value of preferred dividends
            
            
            69,904
            
            
            21,624Purchase
                of property and equipment via increase of capital lease obligations
            
            
            33,587
            
            
            -Purchase
                of US Installs via increase in accrued expenses
            
            
            102,516
            
            
            -Acquisition
                of securities available for sale upon expiration of contingent
                rights
            
            
            208,969
            
            
            -Reduction
                of stock subscription receivable via cancellation of common
                stock
            
            
            61,333
            
            
            -Debt
                and accrued interest paid with issuance of common stock
            
            
            19,500
            
            
            -Purchase
                of 51% of MMT via issuance of notes payable and common stock, net
                of
                discount for imputed interest
            
            
            5,782,690
            
            
            -Sale
                of property, equipment and intangible to DirecTECH for other current
                asset
            
            
            -
            
            
            416,754Debt
                and interest assumed by DirecTECH as part of asset sale
            
            
            -
            
            
            267,143Common
                stock issued for prepaid expense/service
            
            
            -
            
            
            112,500Note
                payable executed for prepaid expense/service
            
            
            -
            
            
            44,407




See
      notes
      to condensed consolidated financial statements




Page
          5


**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**


**Note
      1 – Unaudited Consolidated Financial Statements**





The
      information furnished in this report is unaudited and reflects all adjustments
      which are normal recurring adjustments and, which in the opinion of management,
      are necessary to fairly present the operating results for the interim periods.
      The operating results for the interim periods presented are not necessarily
      indicative of the operating results to be expected for the full fiscal year.
      The
      consolidated financial statements should be read in conjunction with the
      consolidated financial statements and footnotes thereto included in the
      Company’s Annual Report on Form 10-K for the year ended December 31, 2007,
      previously filed with the Securities and Exchange Commission.







**NOTE
      2 – Summary of Significant Accounting Policies**





*Nature
      of Business*





Multiband
      Corporation and subsidiaries (the Company) was incorporated in Minnesota in
      September 1975. The Company provides voice, data and video services to
      multi-dwelling unit customers and provides video services to single family
      home
      customers. The Company's products and services are sold to customers located
      throughout the United States of America.





The
      accompanying consolidated financial statements have been prepared assuming
      the
      Company will continue as a going concern that contemplates the realization
      of
      assets and satisfaction of liabilities in the normal course of business. For
      the
      six months ended June 30, 2008 and 2007, the Company incurred net losses of
      $807,957 and $2,642,374, respectively. At June 30, 2008, the Company had an
      accumulated deficit of $82,943,200. The Company's ability to continue as a
      going
      concern is dependent on it ultimately achieving profitability and/or raising
      additional capital. Management intends to sell certain assets on a strategic
      basis for prices agreeable to the Company and/or obtain additional debt or
      equity capital to meet all of its existing cash obligations and fund commitments
      on planned Multiband projects; however, there can be no assurance that the
      sources will be available or available on terms favorable to the Company.
      Management anticipates that the impact of the actions listed below will generate
      sufficient cash flows to pay current liabilities, long-term debt and capital
      and
      operating lease obligations and fund the Company's future operations through
      2008:





1.
            Reduction
                of operating expenses by controlling payroll, professional fees and
                other
                general and administrative
                expenses.




2.
            Sale
                of video assets on a strategic basis. The Company, based on recent
                transactions, believes there is an active market for its video subscriber
                assets. The Company believes it can sell these assets, under certain
                circumstances, at prices at or above their current carrying value.
                However, there is no guarantee these sales will ultimately be favorable
                to
                the Company.




3.
            Solicit
                additional equity investment in the Company by either issuing preferred
                or
                common stock.




4.
            Continue
                to market Multiband services and acquire additional multi-dwelling
                unit
                customers.




5.
              Control
                  capital expenditures by contracting Multiband services and equipment
                  through a landlord-owned equipment
                  program.




6.
            Delivery
                of video services to residents of single family homes. Effective
                March 1,
                2008, the Company purchased 51% of the outstanding stock of Michigan
                Microtech, Inc. (MMT), formerly a wholly owned subsidiary of DirecTECH
                Holding Company Inc. (DTHC) (see Note 4). MMT installs DirecTV video
                services in single family homes. Historically MMT has been profitable.
                The
                Company anticipates that by combining MMT operations with Multiband
                operations that it will achieve a beneficial impact to its consolidated
                cash flows and operating results. However, there is no guarantee
                that
                these combined results will ultimately be favorable to the
                Company.




7.
            Expansion
                of call center support via sales of call center services to both
                existing
                and future system operators and to buyers of the Company’s video
                subscribers.




Page
          6




**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**


*Principles
      of Consolidation*





The
      consolidated financial statements include the accounts of Multiband Corporation
      (MB) and its wholly owned subsidiaries, Minnesota Digital Universe, Inc. (MDU),
      Rainbow Satellite Group, LLC (Rainbow), Multiband Subscriber Services, Inc.
      (MBSS), and Multiband USA, Inc. (MBUSA). Effective March 1, 2008, the Company
      acquired 51% of the outstanding shares of Michigan Microtech, Inc. (MMT) (see
      Note 4). The minority interest on the consolidated balance sheet and statement
      of operations represents the 49% of activity for the period which the Company
      does not own. The consolidated financial statements include the accounts of
      MMT.
      All significant intercompany transactions and balances have been eliminated
      in
      consolidation.





*Revenue
      Recognition*





The
      Company recognizes revenue in accordance with the Securities Exchange
      Commission’s Staff Accounting Bulletin No. 104 (SAB 104) “Revenue Recognition”,
      which requires that four basic criteria be met before revenue can be recognized:
      (i) persuasive evidence of a customer arrangement exists; (ii) the price is
      fixed or determinable; (iii) collectability is reasonably assured; and (iv)
      product delivery has occurred or services have been rendered. The Company
      recognizes revenue as products are shipped based on FOB shipping point terms
      when title passes to customers.





The
      Company earns revenues from four sources: 1) Voice, video and data
      communications products which are sold and installed, 2) Multiband user charges
      to multiple dwelling units, 3) MDU earns revenue primarily through the
      activation of and residual fees on video programming services provided to
      residents of multiple dwelling units; and 4) MMT earns revenue primarily through
      the installation and service of DirecTV (DTV) video programming for residents
      of
      single family houses.





Customers
      contract for both the purchase and installation of voice and data networking
      technology products and certain video technologies products. Revenue is
      recognized when the products are delivered and installed and the customer has
      accepted and has the ability to fulfill the terms.





Revenue
      generated from activation of video programming services is earned in the month
      of activation. According to Multiband's Master System Operator agreement with
      DirecTV, in the event that a customer cancels within the first 12 months of
      service, DirecTV has the right to chargeback the Company for a portion of the
      activation fees received. In accordance with Securities Exchange Commission
      SAB
      104, the Company has estimated the potential charge back of commissions received
      on activation fees during the past 12 months based on historical percentages
      of
      customer cancellations and has included that amount as a reduction of revenue.
      Residual income is earned as services are provided by DirecTV through its system
      operators. As a master system operator for DirecTV, the Company earns a fixed
      percentage based on net cash received by DirecTV for recurring monthly services
      and a variable amount depending on the number of activations in a given month.
      The Company’s master system operator contract with DirecTV also permits the
      Company to earn revenues through its control of other system operators who
      are
      unable to provide DirecTV video programming services without the Company’s
      performance.





MMT
      has a
      home services provider (HSP) agreement with DirecTV which allows MMT to install
      and activate DTV video programming services for residents of single family
      homes. As a DirecTV HSP, MMT earns revenue for installing and servicing DTV
      video customers pursuant to predetermined rates set by DirecTV which may vary
      from time to time. Revenue is recognized upon completion of the delivery and
      installation of equipment.


Page
          7




**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**




The
      Company reports the aforementioned voice, data, and video revenues on a gross
      basis based on the following factors: the Company has the primary obligation
      in
      the arrangement with its customers; the Company controls the pricing of its
      services; the Company performs customer service for the agreements; the Company
      approves customers; and the Company assumes the risk of payment for services
      provided.





We
      offer
      some products and services that are provided by third party vendors. We review
      the relationship between us, the vendor and the end customer on an individual
      basis to assess whether revenue should be reported on a gross or net basis.
      As
      an example, our resold satellite digital television revenue is reported on
      a net
      basis.





The
      Company has determined that the accounting policies for income recognition
      described above were in accordance with the Financial Accounting Standards
      Board
      Emerging Issues Task Force (“EITF”) Issue No. 99-19, “Reporting Revenue Gross as
      a Principal versus Net as an Agent”. EITF No. 99-19 employs multi-factor tests
      to determine whether amounts charged to customers in respect of certain expenses
      incurred should be included in revenues or netted against such
      expenses.





In
      June
      2006, the Financial Accounting Standards Board (FASB) ratified the consensus
      of
      Emerging Issues Task Force Issue No. 06-3, “How Taxes Collected from Customers
      and Remitted to Governmental Authorities Should Be Presented in the Income
      Statement (That Is, Gross versus Net Presentation)” (EITF 06-3). EITF 06-3
      concluded that the presentation of taxes imposed on revenue-producing
      transactions (sales, use, value added and excise taxes) on either a gross
      (included in revenues and costs) or a net (excluded from revenues) basis is
      an
      accounting policy that should be disclosed. The Company’s policy is to present
      taxes imposed on revenue-producing transactions on a net basis.





Revenue
      generated by the support center to service third party subscribers by providing
      billing and call center support services is recognized in the period the related
      services are provided.





Multiband,
      Rainbow, MDU and MBUSA user charges are recognized as revenues in the period
      the
      related services are provided in accordance with SAB 104. Any amounts billed
      prior to services being provided are reported as deferred service obligations
      and revenues. MMT installation and services revenues are recognized in the
      period the related services are provided in accordance with SAB
      104.


Page
          8




**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**JUNE
      30, 2008 AND 2007**





*Goodwill
      and Other Intangible Assets*





We
      periodically evaluate goodwill and other intangible and long-lived assets for
      potential impairment indicators. Our judgments regarding the existence of
      impairment indicators are based on legal factors, market conditions and
      operational performance of our business segments. Future events could cause
      us
      to conclude that impairment indicators exist and that goodwill and other
      intangible and long-lived assets are impaired. Any resulting impairment loss
      could have a material adverse impact on our financial condition and results
      of
      operations. Goodwill was $116,757 and $16,757 at June 30, 2008 and December
      31,
      2007, respectively, and is recorded as part of our Multiband Corp. and MCS
      segments. The increase in goodwill during 2008 is due to the purchase US Install
      (see Note 4).





Due
      to
      the abandonment of a right of entry intangible asset, the Company recorded
      an
      impairment charge of $7,406 and $65,452 for the three and six months ended
      June
      30, 2008. This charge was determined based upon the net book value of assets
      to
      be abandoned.





Components
      of intangible assets are as follows:




June 30, 2008
                
                December 31, 2007Gross
                  Carrying
                
                Accumulated
                
                Gross
                  Carrying
                
                AccumulatedAmount
                
                Amortization
                
                Amount
                
                AmortizationIntangible assets subject to amortizationRight
                    of entry contracts
                
                $
                800,741
                
                $
                481,836
                
                $
                993,393
                
                $
                618,027Contracts
                    with DirecTV
                
                
                12,547,145
                
                
                7,093,243
                
                
                9,697,879
                
                
                6,001,169Customer
                    contracts
                
                
                102,516
                
                
                34,172
                
                
                -
                
                
                -Total
                
                
                13,450,402
                
                
                7,609,251
                
                
                10,691,272
                
                
                6,619,196Impairment
                    of intangibles
                
                
                -
                
                
                65,452
                
                
                -
                
                
                -Total
                    including impairment
                
                $
                13,450,402
                
                $
                7,674,703
                
                $
                10,691,272
                
                $
                6,619,196





Amortization
      of intangible assets was $665,786 and $636,684 for the three months ended June
      30, 2008 and 2007, respectively. For the six months ended June 30, 2008 and
      2007, amortization of intangible assets was $1,182,706 and $1,309,753,
      respectively. Amortization of debt issuance costs of $0 and $7,986 for the
      six
      months ended June 30, 2008 and 2007, respectively, is included in interest
      expense. Estimated amortization expense of intangible assets for the years
      ending December 31, 2008, 2009, 2010, 2011, 2012 and thereafter is $1,337,581,
      $2,537,421, $1,464,137, $336,190, $36,267, $64,103, respectively. The weighted
      average remaining life of the intangibles is 2.44 years with right of entry
      average life of 5.81 years, contracts with DirecTV of 2.30 years and customer
      contracts of .67 years as of June 30, 2008.


Page
          9




**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**JUNE
      30, 2008 AND 2007**





*Share-Based
      Compensation*





The
      Company recognizes share-based compensation costs on a straight-line basis
      over
      the requisite service period of the award, which is generally the option vesting
      term. For the three months ended June 30, 2008 and 2007, total share-based
      compensation expense of $150,548 ($.02 per share) and $157,685 ($.02 per share)
      was included in selling, general and administrative expenses, respectively.
      For
      the six months ended June 30, 2008 and 2007, total share-based compensation
      expense of $362,126 ($.04 per share) and $391,433 ($.06 per share) was included
      in selling, general and administrative expenses, respectively. Estimated share
      based compensation expense for the years ending December 31, 2008, 2009, 2010,
      2011 and 2012 is $713,026, $95,473, $14,939, $503 and $0, respectively. This
      is
      an estimate based on options currently outstanding and therefore this projected
      expense could be more in the future.





In
      determining the compensation cost of the options granted during the three and
      six months ended June 30, 2008 and 2007, as specified by SFAS No. 123R, the
      fair
      value of each option grant has been estimated on the date of grant using the
      Black-Scholes option pricing model and the weighted average assumptions used
      in
      these calculations are summarized as follows:





Three months
              ended
              June 30, 2008
            
            Three months
              ended
              June 30, 2007
            
            Six months
              ended
              June 30, 2008
            
            Six months
              ended
              June 30, 2007Risk-free
                interest rate
            
            
            2.88
            %
            
            4.50
            %
            
            2.69
            %
            
            4.63
            %Expected
                life of options granted
            
            
            10 Years
            
            
            10 Years
            
            
            10 Years
            
            
            10 YearsExpected
                volatility range
            
            
            260
            %
            
            240
            %
            
            260.5
            %
            
            236
            %Expected
                dividend yield
            
            
            0
            %
            
            0
            %
            
            0
            %
            
            0
            %





The
      Company’s determination of fair value of share-based payment awards on the date
      of grant using an option-pricing model is affected by the Company’s stock price
      as well as assumptions regarding a number of variables. These variables include,
      but are not limited to the Company’s expected stock price volatility, and actual
      and projected stock option exercise behaviors and forfeitures.





The
      Company issued 22,500 shares of restricted stock in the amount of $23,625 to
      two
      officers of the Company. The value of the restricted stock was established
      by
      the market price on the date of grant. These restricted shares are immediately
      vesting and were issued as performance bonuses pursuant to the Company’s
      Employee Stock Compensation Plan.





*Net
      Income (Loss) per Common Share*





Basic
      net
      income (loss) per common share is computed by dividing the loss attributable
      to
      common stockholders by the weighted average number of common shares outstanding
      for the reporting period. Diluted loss per common share is computed by dividing
      loss attributable to common stockholders by the sum of the weighted average
      number of common shares outstanding plus all additional common stock that would
      have been outstanding if potentially dilutive common shares related to common
      share equivalents (stock options, stock warrants, convertible preferred shares,
      and issued but not outstanding restricted stock) had been issued. All options,
      warrants, convertible preferred shares, and restricted stock outstanding during
      the three and six months ended June 30, 2008 and 2007 were excluded from the
      calculation of diluted loss per share as their effects were anti-dilutive due
      to
      the Company’s net losses for the periods.





*Segment
      Reporting*





A
      business segment is a distinguishable component of an enterprise that is engaged
      in providing an individual product or service or a group of related products
      or
      services and that is subject to risks and returns that are different from those
      of other business segments. Management believes that the Company has three
      operating segments, MCS, where the Company bills voice, data and video
      subscribers as a principal; MDU where the Company as a master service operator
      for DirecTV receives net cash payments for managing video subscribers through
      its network of system operators and HSP (Home Service Provider), where the
      Company receives net cash payments for the installation and service of DirecTV
      (DTV) video programming for residents of single family houses. These video
      subscribers are billed by DirecTV.


Page
          10




**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**


**NOTE
      3 – Sales Transactions**





Effective
      March 1, 2007, the Company, pursuant to an asset purchase agreement entered
      into
      October 19, 2006 (the “agreement”), completed the sale of substantially all of
      its video assets located in California to Consolidated Smart Broadband Systems,
      LLC (CSBS). The purchase price paid by CSBS was $1,214,000 at closing plus
      an
      additional $100,000, paid on March 30, 2007 consisting of cash proceeds of
      $757,731 and direct payments to lenders of $556,269 (including $22,338 of
      imputed interest).





In
      accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of
      Long-Lived Assets”, the Company classified the assets as held for sale, and
      recorded an impairment charge for the year ended December 31, 2006, that was
      determined based upon the excess net book value of assets sold over the known
      proceeds from the sale. Any consideration received for the assets during future
      accounting periods based upon the earnout formula will be recognized as a gain
      on sale of assets in that period. The results of the sale of the California
      assets resulted in a loss of $40,110, which is included in the selling, general
      and administrative expenses of the accompanying consolidated statements of
      operations for the three months ended March 31, 2007.





Effective
      March 31, 2007, the Company completed the sale of substantially all of its
      video
      assets located in Ohio to DirecTECH MDU (Dtech). The purchase price paid by
      Dtech was $745,790. The purchase price consisted of the assumption of a note
      payable for the gross value of $329,036 and $416,754 cash paid at closing on
      April 20, 2007. The sale of the Ohio assets resulted in a gain on sale in the
      amount of $324,626, which is included in the selling, general and administrative
      expenses during the three months ended March 31, 2007. The proceeds of $683,897,
      including assumed liabilities of $267,143, less the net book value of the MCS
      segment assets sold amounted to a gain on sale of $324,626.





These
      sales were not reported as a discontinued operation because the assets sold
      did
      not constitute a segment or component of the Company’s business, and the Company
      retained assets and on-going service rights associated with the video
      subscribers.


Page
          11




**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**





**NOTE
      4 – Business Acquisitions**





Effective
      March 1, 2008, the Company purchased, pursuant to a Supplemental Agreement
      and
      Plan of Share Exchange, 51% of the outstanding shares of Michigan Microtech,
      Inc. (MMT), previously a wholly owned subsidiary of DirecTECH Holding Company,
      Inc. (DTHC) which equaled 1,020,000 MMT common shares. The consideration paid
      for the shares was 1,490,000 shares of restricted Multiband common stock valued
      at $3,854,000 and a promissory note for $2,246,000. The note is secured by
      the
      aforementioned MMT common shares, which carries a stated interest rate of 5%
      per
      annum and is due February 2013. The Multiband shares, via negotiation and mutual
      agreement between buyer and seller, were valued at $2.59 per share. The seller
      received certain piggyback registration rights with regards to the Multiband
      shares. The note payable was recorded net of a discount for imputed interest
      of
      3% which amortizes monthly as part of interest expense. The total discount
      for
      imputed interest amounted to $317,310. The Company purchased MMT to enter the
      market of installing video services in single family homes. The Company, on
      a
      preliminary and unaudited basis, allocated the purchase price to the fair values
      of MMT assets and liabilities. As part of the acquisition, the Company
      recognized an intangible asset of $2,849,266 related to MMT’s HSP agreement with
      DirecTV. The Company will amortize this intangible over the remaining 38 month
      term of MMT’s home services provided contract with DirecTV. The term of the
      contract will automatically renew as of April 30, 2011 for additional one year
      periods unless either MMT or DirecTV gives written notice of termination at
      least 90 days in advance of expiration of the then current term. Also, all
      signing parties to the October 31, 2007 Plan of Merger Agreement involving
      Multiband Corporation and DirecTECH Holding Company, Inc. have agreed to extend
      the time to reach a definitive agreement in the matter from March 31, 2008
      to
      December 31, 2008. Due to a number of conditions precedent to completion of
      the
      merger including, but not limited to, shareholder approval from both parties,
      Multiband cannot deem it likely as of this date that the merger as originally
      structured in the 4 th quarter
      of 2007 will be completed.





Effective
      March 1, 2008, the Company purchased 100% of the assets of US Install LLC in
      exchange for $95,000 in cash plus 37,879 shares of restricted Multiband common
      stock valued at $102,516, which is included in accrued liabilities on the
      consolidated balance sheet and is to be issued in August, 2008. The Company
      also
      incurred acquisition expense of $1,000 related to this purchase. In addition,
      the parties executed employment agreements with US Install’s two principals. The
      parties also executed noncompetition and nonsolicitation agreements with each
      principal in exchange for cash consideration of $2,500 per agreement. The
      Company allocated the purchase price as follows:





Intangible
                assets
            
            $
            102,516Goodwill
            
            
            100,000Total
                assets acquired
            
            
            202,516





Proceeds
      for the acquisition were obtained via an unsecured promissory note in the amount
      of $100,000 between Multiband and Bas Mattingly Master, LLC, a trust controlled
      by J. Bas Mattingly, chairman of DTHC, with DTHC as a 49% owner of MMT. The
      note
      carries an interest rate of 7% per annum and is due August 20, 2009. The Company
      purchased US Install LLC to diversify its revenue sources.


Page
          12




**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**





The
      unaudited pro forma information does not purport to represent what the Company’s
      results of operations would actually have been if such transactions in fact
      had
      occurred at such date or to project the Company’s results of future
      operations.





**2007**
            
            **2007****Consolidated**
              **as reported**
            
            **Pro Forma**
              **Disclosed**Three months ended
                June 30, 2007Revenues
            
            $
            3,921,726
            
            $
            9,789,698Income
                (loss) from operations
            
            
            (1,253,006
            )
            
            (1,875,378
            )Net
                income (loss)
            
            
            (1,279,979
            )
            
            (1,718,119
            )Preferred
                dividends
            
            
            120,474
            
            
            120,474Loss
                attributable to common shareholders
            
            
            (1,400,453
            )
            
            (1,838,593
            )Basic
                and diluted loss per share:Loss
                attributable to common shareholders
            
            $
            (.20
            )
            $
            (.21
            )Weighted
                average shares outstanding - basic and diluted
            
            
            7,093,071
            
            
            8,583,071





**2008**
            **2008**
            **2007**
            **2007****Consolidated**
              **as reported**
            **Pro Forma**
              **Disclosed**
            **Consolidated**
              **as reported**
            **Pro Forma**
              **Disclosed**Six months
                ended June 30, 2008 and 2007Revenues
            $16,519,936
            $20,919,816
            $8,306,681
            $19,613,782Income
                (loss) from operations
            207,915
            411,450
            (2,485,051)
            (3,806,283)Net
                loss
            (807,957)
            (664,634)
            (2,642,374)
            (3,579,532)Preferred
                dividends
            3,984,682
            3,984,682
            360,401
            360,401Loss
                attributable to common shareholders
            (4,792,639)
            (4,649,316)
            (3,002,775)
            (3,939,933)Basic
                and diluted loss per share:Loss
                attributable to common shareholders
            $
                (.53)
            $
                (.52)
            $
                (.42)
            $
                (.46)Weighted
                average shares outstanding - basic and diluted
            8,998,601
            8,998,601
            7,086,462
            8,576,462


Page
          13




**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**


**NOTE
      5 – Inventories**




**June 30,**
              **2008**
            
            **December 31,**
              **2007**Inventories
              consisted of the following:DirecTV –
                serialized
            
            $
            581,663
            
            $
            -DirecTV –
                nonserialized
            
            
            458,241
            
            
            -Other
            
            
            392,015
            
            
            132,992**Total**
            
            $
            1,431,919
            
            $
            132,992





The
      Company’s inventories are segregated into three major categories. Serialized
      DirecTV inventories consists primarily of satellite receivers and similar
      devices. Non-serialized DirecTV inventories consists primarily of satellite
      dishes, poles and similar devices which are supplied by DirecTV. Other inventory
      consists primarily of cable, switches and various small parts used in the
      installation of DirecTV satellite dishes.








NOTE
      6 – Securities Available for Sale








As
      of
      December 31, 2007, Multiband had the voting rights for and was holding in trust
      58,161 common shares of URON for various contingent rights holders whose rights
      were tied to potential future warrant exercises or preferred stock conversions.
      As of February 4, 2008, certain aforementioned contingent rights were not
      exercised by the various holders; therefore Multiband now owns 37,994 shares
      of
      URON. As a result, Multiband recorded the fair value of URON shares based on
      quoted market prices as an unrealized gain.





**Unrealized**
              **Gains
                on**
              **Securities**Balance,
                December 31, 2007
            
            $
            -Initial
                investment
            
            
            121,582Increase
                in value, for the three months ended
            
            
            87,387Balance,
                March 31, 2008
            
            
            208,969Decrease
                in value, for the three months ended
            
            
            (56,991
            )Balance,
                June 30, 2008
            
            $
            151,978





NOTE
      7 – Stock Transactions





Stock
      warrants activity is as follows for the six months ended June 30,
      2008:





**Number of******
              **Warrants**
            
            **Weighted – Average******
              **Exercise Price**Outstanding, December
                31, 2007
            
            
            3,088,873
            
            $
            7.64Granted
            
            
            -
            
            
            -Exercised
            
            
            -
            
            
            -Cancelled
            
            
            (1,599,854
            )
            
            (7.90
            )Outstanding,
                June 30, 2008
            
            
            1,489,019
            
            $
            7.32





In
      February 2008, all remaining shares of Class I Preferred Stock (39,500 shares)
      were converted into 526,667 shares of Multiband common stock. This conversion
      event created a non-cash dividend expense of $3,744,600 which is reflected
      in
      the Company’s consolidated statement of operations.


Page
          14




**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**JUNE
      30, 2008 AND 2007**





NOTE
      8 – Accrued Liabilities





Accrued
      liabilities consisted of the following:





**June 30,**
              **2008**
            
            **December 31,**
              **2007**Payroll
                and related taxes
            
            $
            1,262,250
            
            $
            512,960Accrued
                preferred stock dividends
            
            
            564,964
            
            
            642,395Accrued
                liability - vendor chargebacks
            
            
            -
            
            
            630,800Accrued
                income taxes
            
            
            420,489
            
            
            -Other
            
            
            909,515
            
            
            745,456**Total**
            
            $
            3,157,218
            
            $
            2,531,611





NOTE
      9 – Business Segments





The
      Company has four reporting segments. Multiband Corp. includes corporate expenses
      (e.g. corporate administrative costs), interest income, interest expense,
      depreciation and amortization. The MDU segment represents results as the master
      service operator for DirecTV. The MCS segment provides voice, data and video
      services to residential multi-dwelling units as the principal to subscribers.
      The HSP segment provides the installation and service of DirecTV (DTV) video
      programming for residents of single family houses.





Segment
      disclosures are as follows:





Multiband
              Corp.
            
            MDU
            
            MCS
            
            HSP
            
            TotalThree
                months ended June 30, 2008:Revenues
            
            $
            -
            
            $
            3,360,696
            
            $
            840,466
            
            $
            6,604,545
            
            $
            10,805,707Income
                (loss) from operations
            
            
            (914,961
            )
            
            1,308,043
            
            
            (656,619
            )
            
            1,228,457
            
            
            964,920Identifiable
                assets
            
            
            3,987,966
            
            
            4,788,667
            
            
            2,564,558
            
            
            11,627,170
            
            
            22,968,361Depreciation
                and amortization
            
            
            279,403
            
            
            396,365
            
            
            195,032
            
            
            8,255
            
            
            879,055Capital
                expenditures
            
            
            987
            
            
            -
            
            
            22,942
            
            
            -
            
            
            23,929





Multiband
              Corp.
            
            MDU
            
            MCS
            
            HSP
            
            TotalThree
                months ended June 30, 2007:Revenues
            
            $
            -
            
            $
            2,517,328
            
            $
            1,404,398
            
            $
            -
            
            $
            3,921,726Income
                (loss) from operations
            
            
            (1,072,823
            )
            
            1,180,906
            
            
            (1,361,089
            )
            
            -
            
            
            (1,253,006
            )Identifiable
                assets
            
            
            1,827,449
            
            
            5,645,281
            
            
            6,085,316
            
            
            -
            
            
            13,558,046Depreciation
                and amortization
            
            
            49,864
            
            
            404,471
            
            
            540,733
            
            
            -
            
            
            995,068Capital
                expenditures
            
            
            -
            
            
            -
            
            
            120,196
            
            
            -
            
            
            120,196





Multiband
              Corp.
            
            MDU
            
            MCS
            
            HSP
            
            TotalSix
                months ended June 30, 2008:Revenues
            
            $
            -
            
            $
            6,246,407
            
            $
            1,689,028
            
            $
            8,584,501
            
            $
            16,519,936Income
                (loss) from operations
            
            
            (1,743,185
            )
            
            1,862,868
            
            
            (1,200,791
            )
            
            1,289,023
            
            
            207,915Identifiable
                assets
            
            
            3,987,966
            
            
            4,788,667
            
            
            2,564,558
            
            
            11,627,170
            
            
            22,968,361Depreciation
                and amortization
            
            
            416,258
            
            
            792,730
            
            
            396,732
            
            
            11,042
            
            
            1,616,762Capital
                expenditures
            
            
            21,665
            
            
            -
            
            
            44,311
            
            
            -
            
            
            65,976




Page
          15


**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**


Multiband
              Corp.
            
            MDU
            
            MCS
            
            HSP
            
            TotalSix
                months ended June 30, 2007:Revenues
            
            $
            -
            
            $
            5,050,203
            
            $
            3,256,478
            
            $
            -
            
            $
            8,306,681Income
                (loss) from operations
            
            
            (2,181,748
            )
            
            2,047,340
            
            
            (2,350,643
            )
            
            -
            
            
            (2,485,051
            )Identifiable
                assets
            
            
            1,827,449
            
            
            5,645,281
            
            
            6,085,316
            
            
            -
            
            
            13,558,046Depreciation
                and amortization
            
            
            99,727
            
            
            810,742
            
            
            1,134,297
            
            
            -
            
            
            2,044,766Capital
                expenditures
            
            
            -
            
            
            -
            
            
            240,881
            
            
            -
            
            
            240,881





Segment
      disclosures by entity are provided to the extent practicable under the Company's
      accounting system.





NOTE
      10 – Commitments and Contingencies





*Legal
      proceedings*





The
      Company is subject to legal actions that arise in the ordinary course of its
      business. The Company accrues for such litigation when a loss is considered
      probable and the amount of such loss, or a range of loss, can be reasonably
      estimated.





In
      July
      2008, the Company received a complaint dated May 2008 filed by various
      individuals against MMT and DTHC alleging violations of state and federal
      statutory payroll overtime law. The Company believes it pays overtime properly
      when earned and intends to vigorously defend the allegations. At this time,
      the
      Company could not reliably estimate a range of loss, if any, with regards to
      the
      matter.





*Significant
      relationship*





The
      Company is a master agent for DirecTV pursuant to a system operator agreement
      with DirecTV dated August 2005. The initial term of the agreement is for three
      years and provides for two additional two-year renewals if the Company has
      a
      minimum number of paying video subscribers in its system operator network.
      As of
      August 2008, the Company believes it has met the requirements for automatic
      renewal. The Company, via MMT, also has a separate home service provider
      agreement with DirecTV ending April 30, 2011.  The term
      of the MMT contract with DirecTV will automatically renew as of May 1, 2011
      for
      additional one year periods unless either MMT or DirecTV gives written notice
      of
      termination at least 90 days in advance of expiration of the then current term.
      Termination of the Company's DirecTV agreements would have a material adverse
      impact on the Company's on-going operations. Revenues generated from DirecTV
      were 92.2% and 89.8% of total revenue for the three and six months ended June
      30, 2008, respectively. Revenues generated from DirecTV for the three and six
      months ended June 30, 2007 were 64.2% and 60.8% of total revenue,
      respectively.





*Gain
      on extinguishment of debt*





In
      January 2008, the Company negotiated payment of the remaining balance of the
      note payable to Vern Swedin by issuing 7,500 shares of common stock at $2.60
      per
      share in settlement of this debt resulting in a gain on extinguishment of debt
      of $29,965. This modification was accounted for as a gain on extinguishment
      of
      debt in accordance with EITF 96-19, “Debtor’s Accounting for a Modification or
      Exchange of Debt Instruments”. This amount is included in other income on the
      consolidated statement of operations for the six months ended June 30,
      2008.





*Current
      portion of long-term debt*





As
      of
      June 30, 2008, the Company failed to meet one of the compliance covenants of
      its
      lender, Convergent Capital, with respect to having minimum net worth of five
      million dollars at June 30, 2008. Convergent Capital provided the Company with
      a
      waiver for the covenant for the six months ended June 30, 2008. The Company’s
      management believes it is probable that the violation will not be cured at
      measurement dates that are within the next twelve months. In accordance with
      EITF 86-30 “Classification of obligations when a violation is waived by the
      creditor”, the Company has classified the debt as current as of June 30, 2008
      and December 31, 2007.




Page
          16


**MULTIBAND
        CORPORATION AND SUBSIDIARIES**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **JUNE
        30, 2008 AND 2007**




*DirecTECH
      Holding Company Bank Loan*




In
      May
      2007 (as subsequently amended in June 2007, December 2007 and June 2008),
      DirecTECH Holding Company (DTHC) and its subsidiaries, including Michigan
      Microtech, Inc. (MMT) which, prior to March 1, 2008, was 100% owned by DTHC,
      entered into a loan and security agreement with MB Financial Bank, N.A. (MB
      Bank). Multiband Corporation, effective March 1, 2008, owns 51% of the common
      stock of MMT. At the time of Multiband’s purchase of the MMT stock in February
      2008, Multiband received a release of the MB Bank’s lien against the MMT stock.
      However, MMT remains an obligor on the overall MB Bank loan. To date, MMT has
      not utilized any of the loan proceeds. Based on the Company’s interpretation of
      Securities Exchange Commission’s Staff Accounting Bulletin No. 5J (SAB 5J), none
      of the DTHC bank loan debt is reflected in MMT’s financial statements which have
      been consolidated with Multiband Corporation’s financial statements for the four
      months ended June 30, 2008.





On
      May 2,
      2008, MB Bank filed a complaint against DTHC and various affiliates in the
      United States District Court for the Northern District of Illinois, Eastern
      Division seeking, amongst other things, to recover the amounts due under the
      notes. At the time of the filing of the complaint, balances due under all
      facilities totaled $15,340,000, which included a balance due on a revolving
      loan
      of $3,500,000. On June 18, 2008, MB Bank and DTHC and various affiliates
      including MMT, entered into a Forbearance Agreement, which expires on October
      10, 2008, which sets forth revised terms and conditions, including the dismissal
      of the court action without prejudice. Under this Forbearance Agreement, MMT
      remains an obligor on the overall MB Bank loan. Revised terms include monthly
      principal payments of $236,667 beginning July 15, 2008. In addition, commencing
      April 21, 2008, interest on all loans will be calculated using the default
      rate
      in the loan agreements (ranges from 9.37-9.62% as of June 18, 2008) and will
      be
      payable on a monthly basis beginning on July 15, 2008. The agreement also
      contains certain reporting requirements and financial covenants that DTHC must
      adhere to during the period of the agreement. As of June 30, 2008, the total
      loan balance equals $12,669,564.





*Auto
      leases*





The
      Company leases substantially all of its fleet vehicles under operating leases
      from one lessor. Each lease commences upon the in-service date of the vehicle
      and requires scheduled lease payments to be paid monthly for one year. After
      one
      year, the Company has the option to renew the open ended lease for one year
      renewal periods or surrender the leased vehicle to the lessor to be sold. If
      the
      net proceeds of such sale exceed the vehicle’s then depreciated value, the
      lessee receives the benefit of such excess. If there is a deficiency upon such
      sale, then lessee is required to pay the deficiency as additional rent to
      lessor. The Company has entered this agreement jointly and severally with
      various subsidiaries of DTHC. For the four months ended June 30, 2008, the
      Company’s operating lease expense under the lease totaled approximately
      $367,000.





*Guaranty*





On
      March
      1, 2006, Corporate Technologies, LLC (CTLLC), a subsidiary of North Central
      Equity, LLC, the purchaser of the MBS business segment, signed a lease with
      Lexstar Tower I Limited Partnership whereby CTLLC assumed the lease obligation
      for substantially all of the first floor space the Company is renting in Fargo,
      North Dakota for the period beginning March 1, 2006 to February 28, 2011.
      Pursuant to the aforementioned lease, the Company entered into a guaranty
      whereby the Company, in the event of a default or early termination of the
      lease
      by CTLLC, is obligated to perform CTLLC’s lease obligation during months 43-60
      of the lease. This guaranty has no effect on the Company’s consolidated
      financial statements for the three and six months ended June 30, 2008 and 2007.
      However, should Multiband eventually have to perform on the guaranty in the
      future, it could be liable for up to $348,881 in rent payments plus any
      associated charges such as property taxes and common area maintenance. The
      Company has evaluated the accounting guidance of FIN 45 “Guarantor’s Accounting
      and Disclosure Requirements for Guarantees” and has determined that it does not
      apply to this guaranty.


Page
          17




**MULTIBAND
      CORPORATION AND SUBSIDIARIES**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**JUNE
      30, 2008 AND 2007**





NOTE
      11 – Income Taxes





At
      June
      30, 2008, the Company’s federal and state net operating loss carryforwards were
      estimated to be approximately $46,662,000 and $38,525,000,
      respectively.





Due
      to
      Multiband’s purchase of 51% of MMT’s stock, effective March 1, 2008, MMT will no
      longer file consolidated tax returns with its former parent DTHC but will file
      as a single entity as it no longer meets the 80% ownership required for tax
      consolidation. Therefore, MMT will not be able to utilize the tax loss
      carryforwards of Multiband Corporation. As of and for the three and six months
      ended June 30, 2008, MMT has recorded income tax expense of $434,300 and
      $462,800, respectively.





The
      Company has adopted FASB Interpretation 48 (FIN 48), “Accounting for Uncertainty
      in Income Taxes” to address the non-comparability in reporting tax assets and
      liabilities resulting from a lack of specific guidance in FASB Statement of
      Financial Accounting Standards No. 109 (SFAS 109), “Accounting for Income Taxes”
on the uncertainty in income taxes recognized in an enterprise’s financial
      statements. Specifically, FIN 48 prescribes (a) a consistent recognition
      threshold and (b) a measurement attribute for the financial statement
      recognition and measurement of a tax position taken or expected to be taken
      in a
      tax return, and provides related guidance on derecognition, classification,
      interest and penalties, accounting interim periods, disclosure and transition.
      To the extent interest and penalties would be assessed by taxing authorities
      on
      any underpayment of income taxes, such amounts would be accrued and classified
      as a component of income tax expenses on the consolidated statement of
      operations. There was no impact on the consolidated financial statements for
      the
      three and six months ended June 30, 2008 and 2007 related to FIN 48. The
      Company’s federal and state tax returns are potentially open to examinations for
      fiscal years 2004-2006. The Company has no significant unrecognized tax benefits
      as of June 30, 2008 that would reasonably be expected to affect our effective
      tax rate during the next twelve months.





NOTE
      12 – Related Party Transactions





Proceeds
      for the acquisition of US Install Inc. by the Company completed in February,
      2008 were obtained via an unsecured promissory note in the amount of $100,000
      between Multiband and Bas Mattingly Master, LLC, a trust controlled by J. Bas
      Mattingly, chairman of DTHC, which is a 49% owner of MMT. The note carries
      an
      interest rate of 7% per annum and is due August 20, 2009.





MMT
      leases office space from two individuals that have ownership via related trusts
      in DTHC. DTHC owns 49% of MMT as a minority interest shareholder (see Note
      4).
      Lease payments amount to $3,300 per month plus expenses, expiring in April
      2009.





Multiband
      and its subsidiaries lease principal offices located at 2000 44 th Street
      SW, Fargo, ND 58013. The Fargo base rate ranges from $7,621 to $8,466 per month.
      The Fargo property is owned in part by David Ekman, Chief Information Officer,
      Multiband.





Bernard
      Schafer is a director of both DTHC and Multiband. DTHC is the minority
      shareholder of MMT (see Note 4).





Multiband
      and DTHC perform certain management and information systems functions for one
      another pursuant to management and employee leasing agreements. DTHC is the
      minority shareholder of MMT (see Note 4).




Page
          18


**FORWARD-LOOKING
      STATEMENTS**





From
      time
      to time, the Company may publish forward-looking statements relating to such
      matters as anticipated financial performance, business prospects, product
      pricing, management for growth, integration of acquisitions, technological
      developments, new products, and similar matters. Words such as “anticipates”,
“may”, “will”, “should”, “believes”, “estimates”, “expects”, “intends”, “plans”,
“predicts”, “will likely result”, “will continue”, or similar expressions
      identify forward-looking statements. The Private Securities Litigation Reform
      Act of 1995 provides a safe harbor for forward-looking statements including
      those made in this statement. In order to comply with the terms of the Private
      Securities Litigation Reform Act, the Company notes that a variety of factors
      could cause the Company's actual results and experience to differ materially
      from the anticipated results or Company's forward-looking statements.





The
      risks
      and uncertainties that may affect the operations, performance, developments
      and
      results of the Company's business include the following: national and regional
      economic conditions; pending and future legislation affecting IT and
      telecommunications industries; market acceptance of the Company's products
      and
      services; the Company's products and services; the Company's continued ability
      to provide integrated communication solutions for customers in a dynamic
      industry; the Company’s ability to successfully integrate and operate recently
      acquired operations, and other competitive factors.





Because
      these and other factors could affect the Company's operating results, past
      financial performance should not necessarily be considered as a reliable
      indicator of future performance and anticipated future period results.





**ITEM
      2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
      OF
      OPERATION**




**OUR
      COMPANY**





Multiband
      Corporation (the Company), is a Minnesota corporation formed in
      September 1975. The Company has three operating segments: 1) Multiband
      Consumer Services (MCS, legally known as Multiband Subscriber Services, Inc.),
      which encompasses the subsidiary corporations, Multiband USA, Inc., and Rainbow
      Satellite Group, LLC, 2) Multi-Dwelling Unit (MDU, legally known as Minnesota
      Digital Universe, Inc.); and 3) Home Service Provider (HSP, legally known as
      Michigan Microtech, Inc (MMT)).





The
      Company completed an initial public offering in June 1984. In
      November 1992, the Company became a non-reporting company under the
      Securities Exchange Act of 1934. In July 2000, the Company regained its
      reporting company status. In December 2000, The Company stock began trading
      on
      the NASDAQ stock exchange under the symbol VICM. In July 2004, the symbol was
      changed to MBND concurrent with the Company’s name change from Vicom,
      Incorporated to Multiband Corporation.





The
      Company’s website is located at: www.multibandusa.com .





From
      its
      inception until December 31, 1998, the Company operated as a telephone
      interconnect company only. Effective December 31, 1998, the Company
      acquired the assets of the Midwest region of Enstar Networking Corporation
      (ENC), a data cabling and networking company. In late 1999, in the context
      of a
      forward triangular merger, the Company, to expand its range of computer products
      and related services, purchased the stock of Ekman, Inc. d/b/a Corporate
      Technologies, and merged Ekman, Inc. into the newly formed surviving
      corporation, Corporate Technologies USA, Inc. (MBS). MBS provided voice,
      data and video systems and services to business and government. The MBS business
      segment was sold effective April 1, 2005. The Company’s MCS segment began in
      February 2000. MCS, the Company’s continuing operating division, provides voice,
      data and video services to multiple dwelling units (MDU), including apartment
      buildings, condominiums and time share resorts. During 2004, the Company
      purchased video subscribers in a number of separate transactions, the largest
      one being Rainbow Satellite Group, LLC. During 2004, the Company also purchased
      the stock of Minnesota Digital Universe, Inc., (MDU segment) which made the
      Company the largest master service operator in MDU’s for DirecTV satellite
      television in the United States. Effective March 1, 2008, the Company purchased
      51% of the outstanding stock of MMT. MMT installs DTV video services in single
      family homes. At July
      25, 2008, the Company had approximately 96,569 owned and managed subscriptions
      with an additional 20,220 subscribers supported by the call center.




Page
          19





**SELECTED
      CONSOLIDATED FINANCIAL DATA**





DOLLAR AMOUNTS AS A
              PERCENTAGE OF REVENUES
            
            DOLLAR AMOUNTS AS A
              PERCENTAGE OF REVENUESTHREE MONTHS ENDED
            
            SIX MONTHS ENDEDJune 30, 2008
            
            June 30, 2007
            
            June 30, 2008
            
            June 30, 2007(unaudited)
            
            (unaudited)
            
            (unaudited)
            
            (unaudited)REVENUES
            
            
            100
            %
            
            100
            %
            
            100
            %
            
            100
            %COST
                OF PRODUCTS & SERVICES (Exclusive of depreciation and amortization
                shown below)
            
            
            59.2
            %
            
            47.7
            %
            
            61.8
            %
            
            48.8
            %SELLING,
                GENERAL & ADMINISTRATIVE
            
            
            23.7
            %
            
            58.8
            %
            
            26.7
            %
            
            56.5
            %DEPRECIATION
                & AMORTIZATION
            
            
            8.1
            %
            
            25.4
            %
            
            9.8
            %
            
            24.6
            %IMPAIRMENT
                OF ASSETS
            
            
            0.1
            %
            
            -
            
            
            0.4
            %
            
            -INCOME
                (LOSS) FROM OPERATIONS
            
            
            8.9
            %
            
            -31.9
            %
            
            1.3
            %
            
            -29.9
            %INTEREST
                EXPENSE & OTHER, NET
            
            
            -0.7
            %
            
            -0.7
            %
            
            -0.9
            %
            
            -1.9
            %INCOME
                (LOSS) BEFORE INCOME TAXES AND MINORITY INTEREST IN
                SUBSIDIARY
            
            
            8.2
            %
            
            -32.6
            %
            
            0.4
            %
            
            -31.8
            %PROVISION
                FOR INCOME TAXES
            
            
            4.0
            %
            
            -
            
            
            2.8
            %
            
            -MINORITY
                INTEREST IN NET INCOME OF SUBSIDIARY
            
            
            3.7
            %
            
            -
            
            
            2.5
            %
            
            -NET
                INCOME (LOSS)
            
            
            0.5
            %
            
            -32.6
            %
            
            -4.9
            %
            
            -31.8
            %




**RESULTS
      OF OPERATIONS**





*Revenues*





Total
      revenues increased 175.5% to $10,805,707 for the quarter ended June 30, 2008
      as
      compared to $3,921,726 for the quarter ended June 30, 2007. Revenues for the
      six
      month period ended June 30, 2008 increased 98.9% to $16,519,936 from $8,306,681
      for the same period in 2007. This overall increase in revenues is primarily
      due
      to the purchase of MMT in March 2008, with revenues for the three and four
      month
      periods ended June 30, 2008 of $6,604,545 and $8,584,501, respectively, offset
      by sales of approximately 13,000 owned subscriptions which occurred throughout
      the first six months of 2007 in efforts to strategically sell unprofitable
      owned
      assets as prudent and redeploy the proceeds from those assets into facilitating
      growth in the Company’s managed subscriber services including our support center
      and our master system operator program.





Revenues
      in the second quarter of 2008, for the MCS segment, decreased 40.2% to $840,466
      as compared to $1,404,398 in the second quarter of 2007. Revenues for the six
      month period ended June 30, 2008, for the MCS segment, decreased 48.1% to
      $1,689,028 from $3,256,478 for the same period in 2007. These decreases were
      primarily due to the aforementioned sales of owned subscriptions offset by
      an
      increase in call center revenue. In 2008, the Company expects MCS revenues
      to
      remain relatively constant throughout the balance of the year.





Revenues
      in the second quarter of 2008 for the MDU segment increased 33.5% to $3,360,696
      as compared to $2,517,328 in the second quarter of 2007. Revenues for the six
      month period ended June 30, 2008, for the MDU segment, increased 23.7% to
      $6,246,407 from $5,050,203 for the same period in 2007. These increases are
      primarily due to the DTV subsidies for property equipment upgrades and increased
      activity from a large system operator. The Company believes it can ultimately
      increase revenues by selling its support center services to its network of
      system operators and by providing ancillary programs for voice and data services
      to that same network. Due to demand for high definition television services
      and
      the aforementioned DTV subsidies for high definition upgrades MDU revenues
      are
      expected to remain above 2007 levels for the balance of 2008.





Page
          20


Revenues
      for the three month period ended June 30, 2008 for the HSP segment, was
      $6,604,545 in comparison to $0 for the same period in 2007. Revenues for the
      six
      month period ended June 30, 2008, for the HSP segment (acquired March 1, 2008),
      were $8,584,501 from $0 for the same period in 2007. This increase is due to
      the
      purchase of MMT (see Note 4). The Company expects that revenues in the HSP
      segment will continue at a rate consistent with the three months ended June
      30,
      2008 throughout the balance of 2008.





*Cost
      of Products and Services (Exclusive of depreciation and
      amortization)*





The
      Company's cost of products and services, increased by 241.7% to $6,393,571
      for
      the quarter ended June 30, 2008, as compared to $1,871,238 for the similar
      quarter last year. For the six months ended June 30, 2008, cost of products
      and
      services were $10,213,769 compared to $4,049,284 in the prior year, a 152.2%
      increase. Overall cost of products and services as a percentage of revenue
      did
      increase due, in part, to the purchase of MMT with costs for the three and
      six
      month periods ended June 30, 2008 of $4,299,560 and $5,737,141, respectively.
      Other factors affecting costs included specific vendor price increases without
      a
      corresponding increase in price to customers, certain commission payments,
      and
      allocation of certain support center costs to cost of products and services.
      These increases were offset by a decrease in costs related to a decrease in
      programming and circuit charges due to a decreased subscriber
      number.





Cost
      of
      products and services for the MCS segment for the quarter were $591,570 compared
      to $1,059,799 in the same quarter last year, a 44.2% decrease. For the six
      months ended June 30, 2008, cost of products and services were $1,195,879 for
      the MCS segment, compared to $2,092,188 in the prior year, a 42.8% decrease.
      In
      2008, the decrease in cost of products and services in the MCS segment is
      directly related to a decrease in programming and circuit charges between the
      comparable periods due to sales of approximately 13,000 owned subscriptions
      which occurred throughout the first six months of 2007.





Cost
      of
      products and services for the MDU segment for the quarter were $1,502,441
      compared to $811,439 in the same quarter last year, an 85.2% increase. For
      the
      six months ended June 30, 2008, cost of products and services were $3,280,749
      for the MDU segment, compared to $1,957,096 in the prior year, a 67.6% increase.
      The increase in cost of products and services in the MDU segment is primarily
      related to an increase in revenue generated by the system operators along with
      a
      change in revenue mix and certain commission payments offset by a reduction
      in
      accrued liabilities for vendor chargebacks of $630,800 during the quarter ended
      June 30, 2008 versus a reduction of $472,614 in the same quarter last year.
      In
      2008, the Company expects MDU cost of products and services to increase slightly
      throughout the balance of the year due to certain commission
      payments.





Cost
      of
      products and services for the HSP segment for the quarter were $4,299,560
      compared to $0 in the same quarter last year. For the six months ended June
      30,
      2008, cost of products and services were $5,737,141 for the HSP segment
      (acquired March 1, 2008), compared to the $0 in the prior year. This increase
      is
      due to the purchase of MMT (see Note 4). Gross margin on the HSP business is
      33.2% which the Company expects to continue through the end of
      2008.





*Selling,
      General and Administrative Expenses*





Selling,
      general and administrative expenses increased 10.9% to $2,560,755 in the quarter
      ended June 30, 2008, compared to $2,308,426 in the prior year’s quarter due
      primarily to the addition of the HSP segment which did not operate during the
      comparable period in 2007. Selling, general and administrative expenses were,
      as
      a percentage of revenues, 23.7% for the quarter ended June 30, 2008 and 58.8%
      for the similar period a year ago. This percentage decrease is primarily due
      to
      decreases in payroll and employee expenses, property maintenance expenses,
      and
      outside service expenses between the comparable periods due to the sale of
      subscribers. The Company anticipates that for the remainder of 2008, selling,
      general and administrative expenses will remain consistent with second quarter
      levels.





For
      the
      six months ended June 30, 2008, selling, general and administrative expenses
      decreased 6.0% to $4,416,038 compared to $4,697,682 for the six months ended
      June 30, 2007. This decrease is due to the reduction in payroll and employee
      expenses, property maintenance expenses, and outside service expenses offset
      by
      the additional four months of the newly acquired HSP segment. As a percentage
      of
      revenue, selling general and administrative expenses were 26.7% for the six
      months ended June 30, 2008, compared to 56.5% for the same period in 2007.
      This
      percentage decrease is primarily due to the decreases in payroll and employee
      expenses, property maintenance expenses and outside service expenses between
      the
      comparable periods.


Page
          21




*Depreciation
      and Amortization*





Depreciation
      and amortization expense decreased 11.7% to $879,055 for the quarter ended
      June
      30, 2008 compared to $995,068 in the prior year’s quarter. For the six months
      ended June 30, 2008, depreciation and amortization expense decreased 20.9%
      to
      $1,616,762 compared to $2,044,766 for the six months ended June 30, 2007. This
      decrease in depreciation and amortization is due to the sale of tangible and
      intangible assets in various states (Note 3). Depreciation and amortization
      expense is expected to remain comparable to second quarter through the remainder
      2008.





*Loss
      from Operations*





The
      Company, in the second quarter of 2008, earned income from operations for its
      combined operating business segments of $964,920 versus a loss of $1,253,006
      during the prior year’s period. Income from operations from said segments was
      $207,915 during the first six months of 2008, compared to a loss of $2,485,051
      during the first half of 2007. The MDU segment showed a profit from operations
      of $1,308,043 and $1,862,868 for the three and six months ended June 30, 2008
      compared to profits of $1,180,906 and $2,047,340 for the three and six months
      ended June 30, 2007. For the second quarter of 2008, the MCS segment showed
      a
      loss from operations of $656,619 compared to a loss of $1,361,089 for the same
      quarter last year. For the six months ended June 30, 2008, the MCS segment
      showed a loss from operations of $1,200,791 compared to a loss of $2,350,643
      for
      the same period in 2007. The Multiband Corporation segment, which has no
      revenues, showed a loss from operations of $914,961 for the three months ended
      June 30, 2008 and $1,743,185 for the six months ended June 30, 2008 compared
      to
      losses of $1,072,823 and $2,181,748 for the same periods last year. For the
      second quarter of 2008, the HSP segment showed a profit from operations of
      $1,228,457, compared to $0 in the same period last year. For the six months
      ended June 30, 2008, profit was $1,289,023 for the HSP segment, compared to
      the
      $0 in the prior year. The HSP segment did not exist in 2007 so there is no
      comparable (Note 4). The Multiband Corporation loss is expected to continue
      in
      future periods as corporate overhead is expected to remain consistent with
      current levels. The Company expects the MDU segment profitability in future
      periods to stabilize as the year to date reduction in profits for this segment
      has been significantly impacted by agent fees paid for owned subscriber sales.
      These sales have now been completed. In addition to the sale of subscribers,
      the
      Company hopes that it can continue to mitigate its loss in the MCS segment
      by
      reducing related payroll expenses. At the same time, the Company will look
      to
      add subscribers in its MDU division since the on-going selling, general and
      administrative expenses to service those subscribers is more variable than
      fixed.





*Interest
      Expense*





Interest
      expense was $113,000 for the quarter ended June 30, 2008, versus $168,010 for
      the similar period a year ago. Amortization of original issue discount was
      $0
      and $8,295 for the three months ended June 30, 2008 and 2007. Interest expense
      was $213,659 for the six months ended June 30, 2008 and $321,417 for the same
      period last year, primarily reflecting a decrease in the Company’s average
      interest rate and original issue discount expense. Amortization of original
      issue discount was $0 for the six months ended June 30, 2008 and $16,589 for
      the
      same period last year.





*Minority
      Interest*





Effective
      March 1, 2008, the Company purchased 51% of the stock of MMT. The minority
      interest on the statement of operations for the three and six month periods
      ended June 30, 2008 of $393,586 and $412,003, respectively, represents 49%
      of
      the activity in MMT not owned by the Company. MMT currently makes up 100% of
      the
      HSP segment.





*Income
      taxes*





Due
      to
      Multiband’s purchase of 51% of MMT’s stock, effective March 1, 2008, MMT will no
      longer file consolidated tax returns with its former parent DTHC but will file
      as a single entity as it no longer meets the 80% ownership required for tax
      consolidation. Therefore, MMT will not be able to utilize the tax loss
      carryforwards of Multiband Corporation since Multiband owns less than 80% of
      MMT. As of and for the three and four month periods ended June 30, 2008, MMT
      has
      recorded income tax expense of $434,300 and $462,800, respectively. MMT
      currently makes up 100% of the HSP segment.


Page
          22




*Net
      Loss*





In
      the
      second quarter of fiscal 2008, the Company reported a net income of $56,441
      compared to a net loss of $1,279,979 for the second fiscal quarter of 2007.
      For
      the six months ended June 30, 2008, the Company recorded a net loss of $807,957
      compared to $2,642,374 for the six months ended June 30, 2007.





**Liquidity
      and Capital Resources**





During
      the six months ended June 30, 2008 and 2007, the Company recorded a net loss
      of
      $807,957 and $2,642,374 respectively. Net cash from operations during the six
      months ended June 30, 2008 was $929,232 as compared to the net cash used by
      operations during the six months ended June 30, 2007 of $623,675. Principal
      payments on current long-term debt over the next 12 months are expected to
      total
      $1,543,361. As of June 30, 2008, the Company failed to meet one the compliance
      covenants of its lender, Convergent Capital, with respect to having minimum
      net
      worth of five million dollars as of the quarter ended June 30, 2008. Convergent
      Capital provided the Company with a waiver for the said covenant as of the
      quarter ended June 30, 2008. The Company’s management believes it is probable
      that the violation will not be cured at measurement dates that are within the
      next twelve months. In accordance with EITF 86-30 “Classification of obligations
      when a violation is waived by the creditor”, the Company has classified the debt
      as current as of June 30, 2008.





Cash
      and
      cash equivalents totaled $8,350,877 at June 30, 2008 versus $944,456 at December
      31, 2007. Working capital at June 30, 2008 was $1,915,680 as compared to a
      working capital deficit of $5,018,177 at December 31, 2007, primarily due to
      the
      acquisition of MMT. Total debt and capital lease obligations increased by
      $1,923,562 in the six months ended June 30, 2008 due to the addition of notes
      payable in order to purchase MMT and US Installs. The Company had a material
      increase in accounts receivable, accounts payable and accrued liabilities for
      the period ended June 30, 2008 verses the period ended December 31, 2007 due
      to
      the acquisition of MMT. Net cash from investing activities totaled $6,698,566
      for the period ended June 30, 2008, compared to $637,536 for the period ended
      December 31, 2007, due to the acquisition of MMT. MMT is an obligor in loans
      entered into by DTHC and subsidiaries in May 2007 (as subsequently amended
      in
      June 2007, December 2007 and June 2008) with MB Financial, N.A. (MB Bank) (see
      Note 10). In the event that DTHC and its various subsidiaries other than MMT
      could not retire the loan then MMT’s cash or other assets may have to be
      utilized to retire the loan which would adversely affect MMT’s working
      capital.





The
      Company experienced a material increase in revenues between the quarter ended
      June 30, 2008 and the quarter ended June 30, 2007. The revenue increase, as
      stated previously, is a result of the additional revenue obtained from the
      purchase of MMT offset by the reduction of revenue resulting from the sale
      of
      unprofitable assets. In 2008, the Company intends to focus on facilitating
      growth of its HSP business segment and its managed subscriber services including
      its support center and its master system operator program. The Company believes
      it can increase revenues by selling its support center services to its network
      of system operators and by providing ancillary programs for voice and data
      services to that same network.





The
      Company used $65,976 for capital expenditures during the six months ended June
      30, 2008, as compared to $240,881 in the similar period last year. Capital
      expenditures consisted of project build-outs and equipment acquired for internal
      use. This decrease was related to a reduction of company funded video and
      internet service build outs to MDU properties made during 2008. Capital
      expenditures in 2008 are expected to be below the 2007 levels.





Management
      anticipates that the impact of the actions listed below will generate sufficient
      cash flows to pay current liabilities, long-term debt and capital and operating
      lease obligations and fund the Company's operations through 2008:





1.
            Reduction
                of operating expenses by controlling payroll, professional fees and
                other
                general and administrative
                expenses.




2.
              Sale
                  of video assets on a strategic basis. The Company, based on recent
                  transactions, believes there is an active market for its video
                  subscriber
                  assets. The Company believes it can sell these assets, under certain
                  circumstances, at prices at or above their current carrying value.
                  However, there is no guarantee these sales will ultimately be favorable
                  to
                  the Company.




3.
            Solicit
                additional equity investment in the Company by either issuing preferred
                or
                common stock.




4.
            Continue
                to market Multiband services and acquire additional multi-dwelling
                unit
                customers.




Page
          23




5.
            Control
                capital expenditures by contracting Multiband services and equipment
                through a landlord-owned equipment
                program.




6.
            Delivery
                of video services to residents of single family homes. Effective
                March 1,
                2008 the Company purchased 51% of the outstanding stock of Michigan
                Microtech, Inc. (MMT), formerly a wholly owned subsidiary of DTHC.
                MMT
                installs DirecTV video services in single family homes. Historically
                MMT
                has been profitable. The Company anticipates that by combining MMT
                operations with Multiband operations that it will achieve a beneficial
                impact to its consolidated cash flows and operating results. However,
                there is no guarantee that these combined results will ultimately
                be
                favorable to the Company.




7.
            Expansion
                of call center support via sales of call center services to both
                existing
                and future system operators and to buyers of the Company’s video
                subscribers.





Management
      of Multiband believes that the cash on hand, combined with capital resources
      and
      the potential ability to monetize intangible subscriber assets, as was done
      in
      the sale of assets to MDUC, is adequate to meet the anticipated liquidity and
      capital resource requirements for the next 12 months.





**CRITICAL
      ACCOUNTING POLICIES AND ESTIMATES**





Impairment
      of Long-Lived Assets





The
      Company’s long-lived assets include property, equipment and leasehold
      improvement. At June 30, 2008, the Company had net property and equipment of
      $1,444,117, which represents approximately 6.3% of the Company’s total assets.
      The estimated fair value of these assets is dependent on the Company’s future
      performance. In assessing for potential impairment for these assets, the Company
      considers future performance. If these forecasts are not met, the Company may
      have to record an impairment charge, which may be material. During the three
      and
      six months ended June 30, 2008 and 2007, the Company did not record any
      impairment losses related to long-lived assets.





Impairment
      of Goodwill





At
      year
      end, we test goodwill for impairment. If indicators of impairment are determined
      to exist, we test goodwill for impairment quarterly. Our judgments regarding
      the
      existence of impairment indicators are based on legal factors, market conditions
      and operational performance of our operating segments. Future events could
      cause
      us to conclude that impairment indicators exist and that goodwill associated
      with our operating segments which amounts to $116,757 as of June 30, 2008,
      may
      be impaired. Any resulting impairment loss could have a material adverse impact
      on our financial condition and results of operations. During the three and
      six
      months ended June 30, 2008 and 2007, the Company did not record any impairment
      losses related to goodwill.





Impairment
      of Intangible Assets





The
      intangible assets consist of rights of entry contracts, contracts with DirecTV,
      customer cable lists, debt issuance costs, domain name, access contracts and
      customer contracts. These intangibles are being amortized over their estimated
      useful lives ranging from 12 to 108 months. If significant changes would occur
      to the estimated future cash flows associated with these intangibles, the
      Company would determine if there is impairment and reduce the value of
      intangibles based on the discounted present value of such cash flows. At June
      30, 2008, the Company had net intangibles of $5,775,699 which represented
      approximately 25.1% of the Company’s total assets. During the three and six
      months ended June 30, 2008, the Company recorded an impairment charge to
      intangible assets of $7,406 and $65,452, respectively (see Note 2). The Company
      did not record any impairment losses related to intangible assets during the
      three and six months ended June 30, 2007.





Inventories





We
      value
      our inventories at the lower of the actual cost or the current estimated market
      value of the inventories. We regularly review inventory quantities on hand
      and
      record a provision for excess and obsolete inventories. Rapid technological
      change, frequent new product development, and rapid product obsolescence that
      could result in an increase in the amount of obsolete inventory quantities
      on
      hand characterize our industry.


Page
          24





Share-Based
      Payments





The
      Company accounts for its stock options in compliance with the Statement of
      Financial Accounting Standard No. 123 (revised 2004), *Share-Based
      Payment* (SFAS
      123(R)), which requires the measurement and recognition of compensation expense
      for all share-based payment awards made to employees and directors including
      employee stock options based on fair values. The Company’s determination of fair
      value of share-based payment awards is based on the date of grant using an
      option-pricing model which incorporates a number of highly complex and
      subjective variables. These variables include, but are not limited to, the
      Company’s expected stock price volatility and estimates regarding projected
      employee stock option exercise behaviors and forfeitures. The Company recognizes
      the expense related to the fair value of the award straight-line over the
      vesting period.





Revenue
      Recognition





The
      Company recognizes revenue in accordance with the Securities Exchange
      Commission’s Staff Accounting Bulletin No. 104 (SAB 104) “Revenue Recognition”,
      which requires that four basic criteria be met before revenue can be recognized:
      (i) persuasive evidence of a customer arrangement exists; (ii) the price is
      fixed or determinable; (iii) collectability is reasonably assured; and (iv)
      product delivery has occurred or services have been rendered. The Company
      recognizes revenue as products are shipped based on FOB shipping point terms
      when title passes to customers.





The
      Company earns revenues from four sources: 1) Voice, video and data
      communications products which are sold and installed, 2) Multiband user charges
      to multiple dwelling units, 3) MDU earns revenue primarily through the
      activation of and residual fees on video programming services provided to
      residents of multiple dwelling units; and 4) MMT earns revenue primarily through
      the installation and service of DirecTV (DTV) video programming services for
      residents of single family houses.





Customers
      contract for both the purchase and installation of voice and data networking
      technology products and certain video technologies products. Revenue is
      recognized when the products are delivered and installed and the customer has
      accepted and has the ability to fulfill the terms.





Revenue
      generated from activation of video programming services is earned in the month
      of activation. According to Multiband's Master System Operator agreement with
      DirecTV, in the event that a customer cancels within the first 12 months of
      service, DirecTV has the right to chargeback the Company for a portion of the
      activation fees received. In accordance with Securities Exchange Commission
      SAB
      104, the Company has estimated the potential charge back of commissions received
      on activation fees during the past 12 months based on historical percentages
      of
      customer cancellations and has included that amount as a reduction of revenue.
      Residual income is earned as services are provided by DirecTV through its system
      operators. As a master system operator for DirecTV, the Company earns a fixed
      percentage based on net cash received by DirecTV for recurring monthly services
      and a variable amount depending on the number of activations in a given month.
      The Company’s master system operator contract with DirecTV also permits the
      Company to earn revenues through its control of other system operators who
      are
      unable to provide DirecTV video programming services without the Company’s
      performance.





MMT
      has a
      home services provider (HSP) agreement with DirecTV which allows MMT to install
      and activate DTV video programming services for residents of single family
      homes. As a DirecTV HSP, MMT earns revenue for installing and servicing DTV
      video customers pursuant to predetermined rates set by DirecTV which may vary
      from time to time. Revenue is recognized upon completion of the delivery and
      installation of equipment.





The
      Company reports the aforementioned voice, data, and video revenues on a gross
      basis based on the following factors: the Company has the primary obligation
      in
      the arrangement with its customers; the Company controls the pricing of its
      services; the Company performs customer service for the agreements; the Company
      approves customers; and the Company assumes the risk of payment for services
      provided.





We
      offer
      some products and services that are provided by third party vendors. We review
      the relationship between us, the vendor and the end customer on an individual
      basis to assess whether revenue should be reported on a gross or net basis.
      As
      an example, our resold satellite digital television revenue is reported on
      a net
      basis.


Page
          25




The
      Company has determined that the accounting policies for income recognition
      described above were in accordance with the Financial Accounting Standards
      Board
      Emerging Issues Task Force (“EITF”) Issue No. 99-19, “Reporting Revenue Gross as
      a Principal versus Net as an Agent”. EITF No. 99-19 employs multi-factor tests
      to determine whether amounts charged to customers in respect of certain expenses
      incurred should be included in revenues or netted against such
      expenses.





In
      June
      2006, the Financial Accounting Standards Board (FASB) ratified the consensus
      of
      Emerging Issues Task Force Issue No. 06-3, “How Taxes Collected from Customers
      and Remitted to Governmental Authorities Should Be Presented in the Income
      Statement (That Is, Gross versus Net Presentation)” (EITF 06-3). EITF 06-3
      concluded that the presentation of taxes imposed on revenue-producing
      transactions (sales, use, value added and excise taxes) on either a gross
      (included in revenues and costs) or a net (excluded from revenues) basis is
      an
      accounting policy that should be disclosed. The Company’s policy is to present
      taxes imposed on revenue-producing transactions on a net basis.





Revenue
      generated by the support center to service third party subscribers by providing
      billing and call center support services is recognized in the period the related
      services are provided.





Multiband,
      Rainbow, MDU and MBUSA user charges are recognized as revenues in the period
      the
      related services are provided in accordance with SAB 104. Any amounts billed
      prior to services being provided are reported as deferred service obligations
      and revenues. MMT installation and services revenues are recognized in the
      period the related services are provided in accordance with SAB
      104.





**ITEM
      3. QUANTITIVE AND QUALITIVE DISCLOSURE ABOUT MARKET RISK**





The
      Company is not subject to any material interest rate risk as any current lending
      agreements are at a fixed rate of interest except for the Convergent Capital
      note of $1,487,500, which varies from 11% to 14%, dependent on the Company’s
      common stock price. Each 1% change in interest impacts the statement of
      operations by approximately $15,000 annually.





**ITEM
      4. CONTROLS AND PROCEDURES**





As
      of the
      end of the period covered by this quarterly report, the Company carried out
      an
      evaluation, under the supervision and with the participation of the Company’s
      management, of the effectiveness of the design and operation of the Company’s
      disclosure controls and procedures pursuant to Rule 13a-14(c) of the Securities
      Exchange Act of 1934. Based upon that evaluation, the Company’s Chief Executive
      Officer and Chief Financial Officer concluded that the Company’s disclosure
      controls and procedures are effective in alerting them in a timely basis to
      material information relating to the Company required to be disclosed in the
      Company’s periodic SEC reports. There have been no significant changes in the
      Company’s internal controls or in other factors which could significantly affect
      internal controls subsequent to the date the Company carried out its evaluation.
      There was no change in the Company’s internal control over financial reporting
      during the Company’s most recently completed fiscal quarter that has materially
      affected, or is reasonably likely to materially affect, the Company’s internal
      control over financial reporting. An exception to the aforementioned conclusions
      is hereby made specifically with regards to the Company’s home service provider
      business segment. As of June 30, 2008, the Company has not tested the
      effectiveness of any controls or procedures with regards to MMT due to the
      recent acquisition of 51% of MMT. The Company does intend to perform such
      testing prior to December 31, 2008.





**PART
      II. OTHER INFORMATION**





**ITEM
      1. LEGAL PROCEEDINGS**





The
      Company is subject to legal actions that arise in the ordinary course of its
      business. The Company accrues for such litigation when a loss is considered
      probable and the amount of such loss, or a range of loss, can be reasonably
      estimated.





The
      Company, in July 2008, received a complaint dated May 2008 filed by various
      individuals against MMT and DTHC alleging violations of state and federal
      statutory payroll overtime law. The Company believes it pays overtime properly
      when earned and intends to vigorously defend the allegations. At this time,
      the
      Company could not reliably estimate a range of loss, if any, with regards to
      the
      matter.


Page
          26





**ITEM
      1A. RISK FACTORS**





Our
      operations and our securities are subject to a number of risks, including but
      not limited to those described below. If any of the following risks actually
      occur, the business, financial condition or operating results of Multiband
      and
      the trading price or value of our common stock could be materially adversely
      affected.





**General**





Multiband,
      since 1998, has taken several significant steps to reinvent and reposition
      itself to take advantage of opportunities presented by a shifting economy and
      industry environment.





Recognizing
      that voice, data and video technologies in the late twentieth century were
      beginning to systematically integrate as industry manufacturers were evolving
      technological standards from "closed" proprietary networking architectures
      to a
      more "open" flexible and integrated approach, Multiband, between 1998 and 2001,
      purchased three competitors which, in the aggregate, possessed expertise in
      data
      networking, voice and data cabling and video distribution technologies.





In
      early
      2000, Multiband created its MCS division, employing the aforementioned
      expertise, to provide communications and entertainment services (local dial
      tone, long distance, high-speed internet and expanded satellite television
      services) to residents in MDUs on one billing platform, which the Company
      developed internally.





**Net
      Losses**





The
      Company had net losses of $807,957 for the six months ended June 30, 2008,
      $6,088,353 for the year ended December 31, 2007, and $10,183,723 for the year
      ended December 31, 2006. The Company may never be profitable.




The
      prolonged effects of generating losses without additional funding may restrict
      our ability to pursue our business strategy. Unless our business plan is
      successful, an investment in our common stock may result in a complete loss
      of
      an investor's capital.





If
      we
      cannot achieve profitability from operating activities, we may not be able
      to
      meet:




o
            our
                capital expenditure objectives;


o
            our
                debt service obligations; or


o
            our
                working capital needs.





**Goodwill**





In
      June
      2001, the Financial Accounting Standards Board (FASB) adopted Statement of
      Financial Accounting Standards (SFAS) 142, "Goodwill and Other Intangible
      Assets" which changed the amortization rules on recorded goodwill from a monthly
      amortization to an annual test of "impairment" for fiscal years beginning after
      December 15, 2001. As of June 30, 2008, the Company had goodwill of $116,757
      primarily related to the purchase of US Installs. At June 30, 2008 the Company
      did not note any indications of impairment related to goodwill.





**Deregulation**





Several
      regulatory and judicial proceedings have recently concluded, are underway or
      may
      soon be commenced that address issues affecting operations and those of our
      competitors, which may cause significant changes to our industry. We cannot
      predict the outcome of these developments, nor can we assure you that these
      changes will not have a material adverse effect on us. Historically, we have
      been a reseller of products and services, not a manufacturer or carrier
      requiring regulation of its activities. Pursuant to Minnesota statutes, our
      Multiband activity is specifically exempt from the need to tariff our services
      in MDU's. However, the Telecommunications Act of 1996 provides for significant
      deregulation of the telecommunications industry, including the local
      telecommunications and long-distance industries. This federal statute and the
      related regulations remain subject to judicial review and additional
      rule-makings of the Federal Communications Commission, making it difficult
      to
      predict what effect the legislation will have on us, our operations, and our
      competitors.


Page
          27





**Dependence
      on Strategic Alliances**





Several
      suppliers or potential suppliers of Multiband, such as McLeod, WorldCom, WS
      Net,
      XO Communications and others have filed for bankruptcy in recent years. While
      the financial distress of its suppliers or potential suppliers could have a
      material adverse effect on Multiband's business, Multiband believes that enough
      alternate suppliers exist to allow the Company to execute its business plans.
      The Company is also highly dependent on its Master System Operator agreement
      with DirecTV. The initial term of the agreement expires in August 2008, and
      provides for two additional two-year renewals if the Company has a minimum
      number of paying video subscribers in its system operator network. Although
      an
      alternate provider of satellite television services, Echostar, exists, the
      termination of its agreements with DirecTV could have a material adverse effect
      on Multiband's business.





**Changes
      in Technology**





A
      portion
      of our projected future revenue is dependent on public acceptance of broadband
      and expanded satellite television services. Acceptance of these services is
      partially dependent on the infrastructure of the internet and satellite
      television which is beyond Multiband's control. In addition, newer technologies,
      such as video-on-demand, are being developed which could have a material adverse
      effect on the Company's competitiveness in the marketplace if Multiband is
      unable to adopt or deploy such technologies.





**Attraction
      and Retention of Employees**





Multiband's
      success depends on the continued employment of certain key personnel, including
      executive officers. If Multiband were unable to continue to attract and retain
      a
      sufficient number of qualified key personnel, its business, operating results
      and financial condition could be materially and adversely affected. In addition,
      Multiband's success depends on its ability to attract, develop, motivate and
      retain highly skilled and educated professionals with a wide variety of
      management, marketing, selling and technical capabilities. Competition for
      such
      personnel is intense and is expected to increase in the future.





**Intellectual
      Property Rights**





Multiband
      relies on a combination of trade secret, copyright and trademark laws, license
      agreements, and contractual arrangements with certain key employees to protect
      its proprietary rights and the proprietary rights of third parties from which
      Multiband licenses intellectual property. Multiband also relies on agreements
      with owners of MDUs which grant the Company rights of access for a specific
      period to MDU premises whereby Multiband is allowed to offer its voice, data,
      and video services to individual residents of the MDUs. If it was determined
      that Multiband infringed the intellectual property rights of others, it could
      be
      required to pay substantial damages or stop selling products and services that
      contain the infringing intellectual property, which could have a material
      adverse effect on Multiband's business, financial condition and results of
      operations. Also, there can be no assurance that Multiband would be able to
      develop non-infringing technology or that it could obtain a license on
      commercially reasonable terms, or at all. Multiband's success depends in part
      on
      its ability to protect the proprietary and confidential aspects of its
      technology and the products and services it sells. There can be no assurance
      that the legal protections afforded to Multiband or the steps taken by Multiband
      will be adequate to prevent misappropriation of Multiband's intellectual
      property.





**Variability
      of Quarterly Operating Results**





Variations
      in Multiband's revenues and operating results occur from quarter to quarter
      as a
      result of a number of factors, including customer engagements commenced and
      completed during a quarter, the number of business days in a quarter, employee
      hiring and utilization rates, the ability of customers to terminate engagements
      without penalty, the size and scope of assignments and general economic
      conditions. Because a significant portion of Multiband's expenses are relatively
      fixed, a variation in the number of customer projects or the timing of the
      initiation or completion of projects could cause significant fluctuations in
      operating results from quarter to quarter.





**Certain
      Anti-Takeover Effects**





Multiband
      is subject to Minnesota statutes regulating business combinations and
      restricting voting rights of certain persons acquiring shares of Multiband.
      These anti-takeover statutes may render more difficult or tend to discourage
      a
      merger, tender offer or proxy contest, the assumption of control by a holder
      of
      a large block of Multiband's securities, or the removal of incumbent
      management.


Page
          28





**Volatility
      of Multiband's Common Stock**





The
      trading price of our common stock has been and is likely to be volatile. The
      stock market has experienced extreme volatility, and this volatility has often
      been unrelated to the operating performance of particular companies. Investors
      may not be able to sell the common stock at or above the price they paid for
      their common stock, or at all. Prices for the common stock will be determined
      in
      the marketplace and may be influenced by many factors, including variations
      in
      our financial results, changes in earnings estimates by industry research
      analysts, investors' perceptions of us and general economic, industry and market
      conditions.





**Future
      Sales of Our Common Stock May Lower Our Stock Price**





If
      our
      existing shareholders sell a large number of shares of our common stock, the
      market price of the common stock could decline significantly. The perception
      in
      the public market that our existing shareholders might sell shares of common
      stock could depress our market price.





**Competition**





We
      face
      competition from others who are competing for a share of the MDU market,
      including other satellite companies, cable companies and telephone companies.
      Some of these companies have significantly greater assets and resources than
      we
      do.





**Uncertain
      Effects Of The Merger**





During
      the fourth quarter of 2007, the Company announced its intent to merge with
      DirecTECH Holding Company, Inc. (DTHC) pursuant to a signed merger agreement.
      The announcement of the merger may produce an uncertain effect on Multiband’s
      and DTHC’s business relationships, operating results and business generally,
      including their ability to retain key employees, suppliers and customers. Even
      if the Merger is consummated, the DTHC business as merged into the Multiband
      business may not achieve the operating results and growth anticipated by
      management in structuring the transaction. As of this date, the merger has
      not
      been completed. Due to a number of conditions precedent to completion of the
      merger including, but not limited to, shareholder approval from both parties,
      Multiband cannot deem it likely as of this date that the merger as originally
      structured in the 4 th quarter
      of 2007 will be completed.




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          29




**ITEM
      6. EXHIBITS**





(a)
            Exhibits





31.1
            Certification
                of Chief Executive Officer pursuant to Rules 13a-14 and 15d-14 of
                the
                Exchange Act.





31.2
            Certification
                of Chief Financial Officer pursuant to Rules 13a-14 and 15d-14 of
                the
                Exchange Act.





32.1
            Certification
                of Chief Executive Officer pursuant to 18 U.S.C. Section
                1350.





32.2
            Certification
                of Chief Financial Officer pursuant to 18 U.S.C. Section
                1350.





**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned thereunto
      duly authorized.





MULTIBAND
                CORPORATION
              RegistrantDate:
                August 14, 2008
            By:
            /s/
                James L. Mandel
              *Chief
                Executive Officer*Date:
                August 14, 2008
            By:
            /s/
                Steven M. Bell
              *Chief
                Financial Officer*
              *(Principal
                Financial and Accounting
                Officer)*




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          30