UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                   FORM 10-Q


/x/ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of 1934 for the period ended March 31, 2003, or


/ / Transition report pursuant to Section 13 or 15(d) of the Securities
                          Exchange Act of 1934

                        Commission file number 0-13865


                            RARE MEDIUM GROUP, INC.
            (Exact name of registrant as specified in its charter)

          Delaware                                            23-2368845
(State or other jurisdiction                              (I.R.S. Employer
of incorporation or organization)                      Identification Number)


     19 West 44th Street, Suite 507
        New York, New York                                      10036
 (Address of principal executive offices)                     (Zip Code)

      Registrant's telephone number, including area code: (212) 730-7540

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 Exchange Act of
1934 during the preceding 12 months (or for such shorter periods 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 / /

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act).

                                Yes / / No /x/

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

As of May 13, 2003, 6,071,360 shares of the registrant's voting common stock
and 8,990,212 shares of the registrant's non-voting common stock were
outstanding.



<PAGE>
<TABLE>
                                                                   INDEX

                                                                                                            Page
                                                                                                            ----
<S>                                                                                                         <C>
Part I.  FINANCIAL INFORMATION

Item 1.  Consolidated Financial Statements

     Consolidated Balance Sheets as of December 31, 2002 and March 31, 2003
     (Unaudited)                                                                                             2

     Unaudited Consolidated Statements of Operations - Three months ended
       March 31,2002 and 2003                                                                                3

     Unaudited Consolidated Statements of Cash Flows - Three months ended March 31,
       2002 and 2003                                                                                         4

     Notes to Unaudited Consolidated Financial Statements                                                    5

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of
   Operations                                                                                                11

Item 3.  Quantitative and Qualitative Disclosures About Market Risk                                          15

Item 4.  Controls and Procedures                                                                             15

Part II.  OTHER INFORMATION

Item 1.  Legal Proceedings                                                                                   16

Item 2.  Changes in Securities                                                                               17

Item 3.  Defaults Upon Senior Securities                                                                     17

Item 4.  Submission of Matters to a Vote of Security Holders                                                 17

Item 5.  Other Information                                                                                   17

Item 6.  Exhibits and Reports on Form 8-K                                                                    17

SIGNATURES                                                                                                   18

CERTIFICATIONS                                                                                               19
</TABLE>

<PAGE>
<TABLE>

                            RARE MEDIUM GROUP, INC.
                          CONSOLIDATED BALANCE SHEETS
                       (In thousands except share data)
<CAPTION>
                                                                                         December 31,          March 31,
                                                                                             2002                2003
                                                                                        ----------------    ----------------
                                                                                                              (Unaudited)
<S>                                                                                             <C>                 <C>

                                        Assets
Current assets:
   Cash and cash equivalents                                                                    $37,484             $37,205
   Short-term investments                                                                         2,008                 500
                                                                                        ----------------    ----------------
     Total cash, cash equivalents and short-term investments                                     39,492              37,705
   Prepaid expenses and other current assets                                                      1,412               1,184
                                                                                        ----------------    ----------------
     Total current assets                                                                        40,904              38,889

Property and equipment, net                                                                          24                  21
Notes receivable from the Mobile Satellite Venture, L.P.                                         56,823              58,220
Note receivable from Motient Corporation, net                                                        --                  --
Investments in affiliates                                                                         2,343               2,253
Other assets                                                                                        252                 169
                                                                                        ----------------    ----------------
       Total assets                                                                            $100,346             $99,552
                                                                                        ================    ================

                          Liabilities and Stockholders' Equity
Current liabilities:
   Accounts payable                                                                              $2,105              $1,773
   Accrued liabilities                                                                            5,610               5,035
                                                                                        ----------------    ----------------
     Total current liabilities                                                                    7,715               6,808
Other noncurrent liabilities                                                                         --                  --
                                                                                        ----------------    ----------------
       Total liabilities                                                                          7,715               6,808
                                                                                        ----------------    ----------------
Series A Convertible Preferred Stock, $.01 par value, net of unamortized                         70,495              72,894
  discount of $41,373 and $40,275, respectively
                                                                                        ----------------    ----------------
Minority interest                                                                                11,334              11,607
                                                                                        ----------------    ----------------
Stockholders' equity:
   Preferred stock, $.01 par value. Authorized 10,000,000 shares; issued
     1,118,684 shares as Series A Convertible Preferred Stock at December 31,
     2002 and 1,131,688 shares at March 31, 2003                                                     --                  --
   Common stock, $.01 par value.  Authorized 200,000,000 shares; issued and
     outstanding 6,682,615 shares at December 31, 2002 and 7,039,758 shares at March
     31, 2003                                                                                        67                  70
   Non-voting common stock, $.01 par value.  Authorized 100,000,000 shares; issued
     and outstanding 8,990,212 shares at December 31, 2002 and March 31, 2003                        90                  90
   Additional paid-in capital                                                                   547,250             547,356
   Accumulated deficit                                                                        (536,434)            (539,102)
   Treasury stock, at cost, 6,622 shares                                                          (171)                (171)
                                                                                        ----------------    ----------------
       Total stockholders' equity                                                                10,802               8,243
                                                                                        ----------------    ----------------
        Total liabilities and stockholders' equity                                              $100,346            $99,552
                                                                                        ================    ================


                                See accompanying notes to unaudited consolidated financial statements.
</TABLE>

<PAGE>
<TABLE>


                            RARE MEDIUM GROUP, INC.
                UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
                       (In thousands except share data)
<CAPTION>

                                                                                     Three Months Ended March 31,
                                                                                    --------------------------------
                                                                                        2002              2003
                                                                                    -------------    ---------------
<S>                                                                                        <C>                <C>
Revenues                                                                                     $--                $--
Cost of revenues                                                                              --                 --
                                                                                    -------------    ---------------
   Gross profit                                                                               --                 --
Expenses:
   Selling, general and administrative                                                     2,613              1,852
   Depreciation and amortization                                                              29                  7
                                                                                    -------------    ---------------
     Total expenses                                                                        2,642              1,859
                                                                                    -------------    ---------------
Loss from operations                                                                      (2,642)            (1,859)
Interest income, net                                                                       1,332              1,509
Loss on investments in affiliates                                                             --                (99)
Other income (expense), net                                                                    4                 (5)
Minority interest                                                                           (240)              (269)
                                                                                    -------------    ---------------
Loss before taxes and discontinued operations                                             (1,546)              (723)
Income tax benefit                                                                           350                 --
                                                                                    -------------    ---------------
Loss before discontinued operations                                                       (1,196)              (723)
Gain from wind-down of discontinued operations                                                --                454
                                                                                    -------------    ---------------
Net loss                                                                                  (1,196)              (269)
   Cumulative dividends and accretion of convertible preferred stock to
     liquidation value                                                                    (3,073)            (2,399)
                                                                                    -------------    ---------------
Net loss attributable to common stockholders                                             $(4,269)           $(2,668)
                                                                                    =============    ===============
Basic and diluted (loss) earnings per share:
  Continuing operations                                                                   $(0.65)            $(0.20)
  Discontinued operations                                                                     --               0.03
                                                                                    -------------    ---------------
     Net loss per share                                                                   $(0.65)            $(0.17)
                                                                                    =============    ===============
Basic weighted average common shares outstanding                                       6,532,496         15,979,281
                                                                                    =============    ===============


                                See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>

<TABLE>

                            RARE MEDIUM GROUP, INC.
                UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In thousands)
<CAPTION>

                                                                                      Three Months Ended March 31,
                                                                                     --------------------------------
                                                                                         2002              2003
                                                                                     -------------     --------------
<S>                                                                                      <C>                  <C>
Cash flows from operating activities:
   Net loss                                                                               $(1,196)             $(269)
   Adjustments to reconcile net loss to net cash used in operating activities:
     Gain from discontinued operations                                                         --               (454)
     Depreciation and amortization                                                             29                  7
     Loss on investments in affiliates                                                         --                 99
     Non-cash compensation (contra-expense) expense                                          (177)                 7
     Non-cash charge for issuance of warrant by consolidated subsidiary                        --                 13
     Changes in assets and liabilities:
       Prepaid expenses, interest receivable and other assets                              (1,491)              (898)
       Accounts payable, accrued and other liabilities                                      1,178                 59
                                                                                     -------------     --------------
           Net cash used in continuing operations                                          (1,657)            (1,436)
           Net cash used in discontinued operations                                          (542)              (392)
                                                                                     -------------     --------------
           Net cash used in operating activities                                           (2,199)            (1,828)
Cash flows from investing activities:
   Cash paid for investments in affiliates                                                     --                 (8)
   Purchases of short-term investments                                                     (2,502)                --
   Sales of short-term investments                                                          2,750              1,509
                                                                                     -------------     --------------
           Net cash provided by continuing operations                                         248              1,501
           Net cash provided by discontinued operations                                       472                 --
                                                                                     -------------     --------------
           Net cash provided by investing activities                                          720              1,501
Cash flows from financing activities:
   Proceeds from contributions to a consolidated subsidiary                                    --                 48
                                                                                     -------------     --------------
           Net cash provided by financing activities                                           --                 48
                                                                                     -------------     --------------
Net decrease in cash and cash equivalents                                                 (1,479)               (279)
Cash and cash equivalents, beginning of period                                              7,061             37,484
                                                                                     -------------     --------------
Cash and cash equivalents, end of period                                                   $5,582            $37,205
                                                                                     =============     ==============


                                See accompanying notes to unaudited consolidated financial statements.
</TABLE>

<PAGE>



(1)  Description of the Business

     Rare Medium Group, Inc. (the "Company") conducts its business through its
subsidiaries. Through its 80% owned MSV Investors, LLC subsidiary ("MSV
Investors Subsidiary"), the Company is an active participant in the Mobile
Satellite Venture, L.P. joint venture ("MSV Joint Venture"), a joint venture
that also includes TMI Communications, Inc., Motient Corporation ("Motient"),
and certain other investors (collectively, the "Other MSV Investors"). The MSV
Joint Venture is currently a provider of mobile digital voice and data
communications services via satellite in North America. The Company has
designated three members of the 12-member board of directors of the MSV Joint
Venture's corporate general partner. In addition, in May 2002, the Company
became affiliated with Miraxis, LLC ("Miraxis"), a development stage company
that has access to a Ka-band license with which it intends to provide
satellite based multi-channel, broadband data and video services in North
America (see Note 4).

     On February 10, 2003, the Federal Communications Commission (the "FCC")
released an order relating to an application submitted by the MSV Joint
Venture and certain of its competitors that could greatly expand the scope of
the MSV Joint Venture's business by permitting the incorporation of an
ancillary terrestrial base stations (which we refer to as an "ancillary
terrestrial component" or "ATC") into its mobile satellite network. A similar
application is pending before Industry Canada, the FCC's counterpart in
Canada. The MSV Joint Venture cannot expand its mobile satellite services
business using ATC base stations into Canada until this application pending
before Industry Canada is approved. With the FCC's issuance of the ATC order,
the Company expects the MSV Joint Venture to enter a new stage of development
which requires significant future funding requirements and/or a need for one
or more strategic partners.

     From 1998 through the third quarter of 2001, the Company's principal
business was conducted through Rare Medium, Inc., which developed Internet
e-commerce strategies, business processes, marketing communications, branding
strategies and interactive content using Internet-based technologies and
solutions. As a result of the weakening of general economic conditions that
caused many companies to reduce spending on Internet-focused business
solutions and in light of their performance and prospects, a decision to
discontinue Rare Medium, Inc.'s operations, along with those of its
LiveMarket, Inc. subsidiary ("LiveMarket"), was made at the end of the third
quarter of 2001 (see Note 6).

     From 1999 through the first quarter of 2001, the Company made venture
investments by taking strategic minority equity positions in other
independently managed companies. Additionally, during that period, the Company
developed, managed and operated companies in selected Internet-focused market
segments ("Start-up Companies"). During the first quarter of 2001, the Company
reduced its focus on these businesses and substantially ceased providing
funding to its Start-up Companies.

     The Company's current operations consist of actively participating in the
MSV Joint Venture, directing the operations of Miraxis and seeking other
complementary operational opportunities. The Company's principal assets
consist of its interest in the MSV Joint Venture, a promissory note from
Motient, its interest in Miraxis, its remaining investments in its venture
portfolio companies and cash, cash equivalents and short-term investments. As
a result of uncertainty with respect to the ultimate collection on the Motient
note, the Company recognized a reserve for the entire amount of the note (see
Note 7).

     As a result of the decision to discontinue the operations of Rare Medium,
Inc. and LiveMarket, the operating results reported in the statements of
operations as continuing operations include the consolidated results of the
Company, its MSV Investors Subsidiary, and its Start-up Companies through
their respective dates of sale or dissolution. The results of Rare Medium,
Inc. and LiveMarket are reflected as discontinued operations.

     The Company is headquartered in New York, New York.


 (2) Basis of Presentation

     The accompanying unaudited consolidated financial statements have been
prepared by the Company in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
the accompanying unaudited consolidated financial statements contain all
adjustments, consisting only of those of a normal recurring nature, necessary
for a fair presentation of the Company's financial position, results of
operations and cash flows at the dates and for the periods indicated. While
the Company believes that disclosures presented are adequate to make the
information not misleading, these unaudited consolidated financial statements
should be read in conjunction with the audited financial statements and
related notes for the year ended December 31, 2002 which are contained in the
Company's Annual Report on Form 10-K filed with the Securities and Exchange
Commission. The results of the three months ended March 31, 2003 are not
necessarily indicative of the results to be expected for the full year.
Certain prior year amounts in the consolidated financial statements have been
reclassified to conform to the current year's presentation.

(3)  Interest in the MSV Joint Venture

     On November 26, 2001, through its MSV Investors Subsidiary, the Company
purchased a $50.0 million interest in the MSV Joint Venture in the form of a
convertible note with a principal amount of $50.0 million. Immediately prior
to the purchase of the convertible note, the Company contributed $40.0 million
to its MSV Investors Subsidiary and a group of unaffiliated third parties
collectively contributed $10.0 million. The note bears interest at a rate of
10% per year, has a maturity date of November 26, 2006, and is convertible at
any time at the option of its MSV Investors Subsidiary into equity interests
in the MSV Joint Venture.

     On August 13, 2002, the MSV Joint Venture completed a rights offering
allowing its investors to purchase their pro rata share of an aggregate $3.0
million of newly issued convertible notes with terms similar to the
convertible note already held by the MSV Investors Subsidiary. The MSV
Investors Subsidiary exercised its basic and over subscription rights and
purchased approximately $1.1 million of the convertible notes. Following this
purchase of the additional convertible note, the MSV Investors Subsidiary
would own, upon conversion, 30.9% of the equity interests in the MSV Joint
Venture. The group of unaffiliated third parties collectively contributed $0.2
million to the MSV Investors Subsidiary in connection with the MSV Joint
Venture rights offering.

     Pursuant to the joint venture agreement among the partners of the MSV
Joint Venture (the "MSV Joint Venture Agreement"), in the event that the MSV
Joint Venture had received final regulatory approval from the FCC, as that
phrase is defined in the MSV Joint Venture Agreement, by March 31, 2003 for
its ATC applications, the Other MSV Investors would have been obligated to
invest an additional $50.0 million in the MSV Joint Venture. As the final
regulatory approval from the FCC, as defined in the MSV Joint Venture
Agreement, was not received by March 31, 2003, the additional investment was
not required. However, the Other MSV Investors retain the option to invest the
$50.0 million at the same terms and conditions until June 30, 2003. If this
additional investment were to occur, the convertible notes held by the MSV
Investors Subsidiary will automatically convert into equity interests, and the
MSV Investors Subsidiary would own approximately 23.7% of the equity interests
in the MSV Joint Venture.

     The $10.2 million received from unaffiliated persons as an investment
into the MSV Investors Subsidiary, as well as their share of the equity in
earnings of the MSV Investors Subsidiary, is reflected in the accompanying
consolidated financial statements as minority interest.

(4)  Business Transactions

     In May 2002, the Company acquired Series B Preferred Shares and a warrant
from Miraxis for approximately $0.4 million, representing an ownership of
approximately 30%. Miraxis is a development stage, privately held
telecommunications company that has access to a Ka-band license with which it
intends to provide satellite based multi-channel, broadband data and video
services in North America. The Company has the right to appoint two of the
seven directors of the manager of Miraxis. Additionally, the Company entered
into a management support agreement with Miraxis under which the Company's
President and Chief Operating Officer provides certain services to Miraxis
through February 2003 in exchange for additional Series B Preferred Shares and
warrants being issued to the Company. In addition, in December 2002, the
Company acquired Series C Preferred Shares and warrants from Miraxis for
approximately $0.1 million.

     In February 2003, the Company entered into a consulting agreement with
Miraxis under which a Miraxis employee would provide services to the Company
through May 2003 and extended the management support agreement whereby the
Company's President and Chief Operating Officer will continue to provide
certain services to Miraxis through May 2003. In connection with these
agreements, the Company paid Miraxis approximately $40,000 and received
additional Series C Preferred Shares and warrants.

     In April 2003, the Company acquired additional Series C Preferred Shares
and warrants for approximately $40,000, increasing the Company's ownership
interest to approximately 44%.

     The investment in Miraxis is included in "Investments in Affiliates" on
the accompanying consolidated balance sheets and is being accounted for under
the equity method with the Company's share of Miraxis' loss being recorded in
"Loss on Investments in Affiliates" on the accompanying consolidated
statements of operations.

(5)  Stock Option Plans

     The Company accounts for its stock option plan in accordance with SFAS
No. 123, "Accounting for Stock-Based Compensation" ("SFAS No. 123"), which
allows entities to continue to apply the provisions of APB Opinion No. 25,
"Accounting for Stock Issued to Employees" ("APB Opinion No. 25"), as
clarified by Financial Accounting Standards Board ("FASB") Interpretation No.
44, "Accounting For Certain Transactions Involving Stock Compensation," and
provides pro forma net income and pro forma earnings per share disclosures for
employee stock option grants made in 1995 and future years as if the
fair-value-based method, as defined in SFAS No. 123, had been applied. The
Company has elected to apply the provisions of APB Opinion No. 25 and provide
the pro forma disclosure required by SFAS No. 123.

     APB Opinion No. 25 does not require the recognition of compensation
expense for stock options granted to employees at fair market value. However,
any modification to previously granted awards generally results in
compensation expense or contra-expense recognition using the cumulative
expense method, calculated based on quoted prices of the Company's common
stock and vesting schedules of underlying awards. As a result of the
re-pricing of certain stock options, for the three months ended March 31,
2002, the Company recognized compensation contra-expense of approximately $0.2
million resulting from the decrease in the price of the Company's common stock
from December 31, 2001 to March 31, 2002. For the three months ended March 31,
2003, the Company recognized compensation expense of approximately $7,000
relating to the re-pricing of certain stock options.

     The following table provides a reconciliation of net loss to pro forma
net loss as if the fair value method had been applied to all awards:

<TABLE>

                                                                               Three Months Ended March 31,
                                                                              --------------------------------
                                                                                   2002              2003
                                                                              ---------------    -------------
<S>                                                                                 <C>                 <C>
Net loss, as reported                                                               $(1,196)            (269)
(Deduct) Add:  Stock-based compensation (contra-expense) expense, as
   reported                                                                            (177)               7
Deduct:  Total stock-based compensation expense determined under fair value
   based method for all awards                                                         (306)            (159)
                                                                              ---------------    -------------
Pro forma net loss                                                                  $(1,679)            (421)
                                                                              ===============    =============
Basic and diluted net loss attributable to common stockholders per share
   As reported                                                                       $(0.65)          $(0.17)
   Pro forma                                                                         $(0.73)          $(0.18)
</TABLE>

     No stock options were issued during the three months ended March 31, 2002
or 2003.


(6)  Discontinued Operations

     At the end of the third quarter of 2001, a decision to discontinue the
operations of Rare Medium, Inc. and the LiveMarket subsidiary was made in
light of their performance and prospects. As of March 31, 2003, the remaining
assets of Rare Medium, Inc. and LiveMarket totaled approximately $0.1 million,
consisting of cash (excluding the $0.3 million of cash collateralizing a
letter of credit) and other current assets. The liabilities of these
subsidiaries totaled approximately $3.2 million, consisting of accounts
payable and accrued expenses. Included in the total liabilities of these
subsidiaries is $1.0 million related to a lease obligation which is guaranteed
by the Company. The total maximum potential liability of this guarantee is
$3.2 million, subject to certain defenses by the Company. Rare Medium, Inc.
holds $0.3 million of cash in a certificate of deposit which is maintained as
collateral for a letter of credit supporting the lease obligation. For the
three months ended March 31, 2002 and 2003, the Company recognized a gain of
nil and approximately $0.5 million, respectively, as a result of the
settlement of Rare Medium, Inc. liabilities at amounts less than their
recorded amounts.

 (7) Contingencies

    Motient Notes

     On May 1, 2002, to mitigate the risk, uncertainties and expenses
associated with Motient's plan of reorganization, the Company cancelled the
outstanding amounts due under the original promissory notes issued by Motient
and accepted a new note in the principal amount of $19.0 million (the "New
Motient Note") that was issued by a new, wholly-owned subsidiary of Motient
that owns 100% of Motient's interests in the MSV Joint Venture ("MSV Holdings
Inc."). The New Motient Note is due on May 1, 2005 and bears interest at a
rate of 9% per annum. Although the New Motient Note is unsecured, there are
material restrictions placed on MSV Holdings Inc.'s assets, and MSV Holdings
Inc. is prohibited from incurring or guarantying any debt in excess of $21.0
million (including the New Motient Note). Additionally, there are events of
default (e.g., a bankruptcy filing by Motient) that would accelerate the due
date of the New Motient Note. As a result of the uncertainty with respect to
the ultimate collection on the New Motient Note, a reserve continues to be
maintained for the entire amount of the note. If the Company recovers any
amount on the New Motient Note, adjustments to the reserve would be reflected
as other income in the accompanying consolidated statements of operations.

   Litigation

     A number of class action lawsuits were filed by the holders of the
Company's common stock against the Company and members of the Company's board
of directors in the Court of Chancery of the State of Delaware challenging the
plan of merger with Motient Corporation that was ultimately terminated on
October 1, 2001. On June 22, 2001, the Delaware court entered an order to
consolidate all of the Delaware lawsuits for all purposes into a single class
action, In re Rare Medium Group, Inc. Shareholders Litigation, C.A. No.
18879-NC. On April 2, 2002, the Company entered into a Stipulation of
Settlement in which it agreed to effectuate a reverse stock split, commence a
rights offering and take certain other corporate actions to settle the
consolidated action. The court approved the settlement on December 2, 2002. In
connection with the settlement, on January 10, 2003, the Company issued
357,143 shares of the Company's common stock (valued at $1.0 million as of
April 2, 2002 based on the tender offer price of $2.80 per share offered by an
affiliate of the preferred stockholders at that time) to the plaintiff's
counsel as attorney's fees and paid the plaintiff's counsel $0.1 million for
expenses. The Company recognized a charge of $0.2 million in 2002 relating to
the settlement, which reflects the lower price of the Company's common stock
on the date of issuance.

     On May 16, 2001, plaintiffs Jay M. Wolff, David Bliss, Tim Barber and
Steve O'Brien filed suit against Rare Medium, Inc., Rare Medium Group, Inc.,
and Rare Medium Texas I, Inc. in the United States District Court for the
Southern District of New York, Wolff, et al. v. Rare Medium, Inc., et al., CV
No 01-4279. The plaintiffs asserted claims for breach of contract, tortious
interference with contractual relations, tortious interference with
prospective advantage, and breach of implied obligation of good faith, arising
out of the plaintiffs' alleged attempt to engage in transactions involving
some or all of the approximately 1,200,000 shares of the Company's common
stock (prior to the reverse stock split) that the plaintiffs obtained in the
Company's acquisition of Big Hand, Inc. The plaintiffs sought unspecified
compensatory and punitive damages, interest, attorneys' fees and costs. On
October 31, 2001, the Court dismissed the case without prejudice. The
plaintiffs filed an amended complaint on December 7, 2001 based on
substantially the same alleged facts. The amended complaint asserts the
following causes of action: (1) breach of contract; (2) tortious interference
with contract; and, (3) tortious interference with prospective business
advantage. The amended complaint also sought an unspecified amount of actual
damages, punitive damages, interest, and costs. On June 27, 2002, the Court
dismissed the case with prejudice. On July 16, 2002, the plaintiffs filed a
notice of appeal. On October 31, 2002, the plaintiffs filed their brief in
support of their appeal. The Company filed its opposition on December 16,
2002, and the plaintiffs replied on January 15, 2003. The Court of Appeals
heard oral arguments on the appeal on February 27, 2003. On March 14, 2003,
the Court of Appeals denied the appeal in its entirety. Further, on April 11,
2003, the Court of Appeals denied a request for rehearing. The Company intends
to continue to vigorously contest any future actions with respect to this
matter.

     On November 19, 2001, five of the Company's shareholders filed a
complaint against the Company, certain of its subsidiaries and certain of
their current and former officers and directors in the United States District
Court for the Southern District of New York, Dovitz v. Rare Medium Group, Inc.
et al., No. 01 Civ. 10196. Plaintiffs became owners of restricted Company
stock when they sold the company that they owned to the Company. Plaintiffs
assert the following four claims against defendants: (1) common-law fraud; (2)
violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 promulgated thereunder; (3) violation of the Michigan Securities Act;
and (4) breach of fiduciary duty. These claims arise out of alleged
representations by defendants to induce plaintiffs to enter into the
transaction. The complaint seeks compensatory damages of approximately $5.6
million, exemplary and/or punitive damages in the same amount, as well as
attorney fees. On January 25, 2002, the Company filed a motion to dismiss the
complaint in its entirety. On June 3, 2002, the Court dismissed the matter
without prejudice. On or about July 17, 2002, the plaintiffs filed an amended
complaint asserting similar causes of action to those asserted in the original
complaint. On September 12, 2002, the Company filed a motion to dismiss on
behalf of itself and its current and former officers and directors. On
November 5, 2002, the plaintiffs filed a brief in opposition to the motion to
dismiss. The Company replied on December 9, 2002. On March 7, 2003, the Court
denied the motion to dismiss. The Company intends to continue to dispute this
matter vigorously.

     The Company and certain of its subsidiaries (along with the Engelhard
Corporation) are parties to an arbitration relating to certain agreements that
existed between or among the claimant and ICC Technologies, Inc., the
Company's former name, and the Engelhard/ICC ("E/ICC") joint venture arising
from the desiccant air conditioning business that the Company and its
subsidiaries sold in 1998. The claimant has sought $8.5 million for (1) its
alleged out of pocket losses in investing in certain of E/ICC's technology;
(2) unjust enrichment resulting from the reorganization of E/ICC in 1998; and
(3) lost profits arising from the fact that it was allegedly forced to leave
the air conditioning business when the E/ICC joint venture was dissolved. The
Company intends to vigorously dispute this action.

     On July 26, 2002, plaintiffs James D. Loeffelbein, Terrie L. Pham and
certain related parties filed suit against the lead plaintiff's counsel in the
class action lawsuit, the Company, certain of its current and former officers,
its former investor relations firm and a former employee of plaintiff
Loeffelbein in the District Court of Johnson County, Kansas, Loeffelbein v.
Milberg Weiss Bershad Hynes & Lerach, LLP, et al., 02 CV 04867. The plaintiffs
assert claims for fraud, negligence and breach of fiduciary duty against all
of the Company and certain of its current and former officers in connection
with allegedly false statements purportedly made to the plaintiffs. The
plaintiffs have sought unspecified damages from the defendants. On September
11, 2002, the matter was removed to the United States District Court for the
District of Kansas. On October 11, 2002, the plaintiffs sought to have the
matter remanded to state court. The Company opposed this motion and intends to
dispute this matter vigorously.

     Though it intends to continue to vigorously contest each of the
aforementioned cases, the Company is unable to predict their respective
outcomes, or reasonably estimate a range of possible losses, if any, given the
current status of these cases. Additionally, from time to time, the Company is
subject to litigation in the normal course of business. The Company is of the
opinion that, based on information presently available, the resolution of any
such additional legal matters will not have a material adverse effect on the
Company's financial position or results of its operations.

(8)  Subsequent Events

     On March 13, 2003, the Company commenced a cash tender offer at a price
of $1.00 per share for up to 2,500,000 shares, or approximately 35.5% of the
Company's outstanding voting common stock. The tender offer expired on April
23, 2003 with 968,398 shares purchased by the Company for an aggregate cost,
including all fees and expenses applicable to the tender offer, of
approximately $1.2 million. The primary purpose of the tender offer was to
provide the Company's public stockholders with additional liquidity for their
shares of common stock, particularly in light of decreased liquidity arising
from the decision of Nasdaq to delist the Company's common stock, and to do so
at a premium over the stock price before the tender offer and without the
usual transaction costs associated with open market sales. The Company's
preferred stockholders did not sell any shares of common stock in the tender
offer.

     The employment contract of the Company's Chairman and Chief Executive
Officer expired on April 15, 2003, and he resigned from the Company's board of
directors on the same date. The Company's President and Chief Operating
Officer was subsequently appointed Chief Executive Officer. In addition, the
Company's Controller and its Treasurer ceased full time employment as of April
15, 2003.


Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

     This report contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 that involve risks and uncertainties, including
statements regarding our capital needs, business strategy, expectations and
intentions. We urge you to consider that statements that use the terms
"believe," "do not believe," "anticipate," "expect," "plan," "estimate,"
"intend" and similar expressions are intended to identify forward-looking
statements. These statements reflect our current views with respect to future
events and because our business is subject to numerous risks, uncertainties
and risk factors, our actual results could differ materially from those
anticipated in the forward-looking statements, including those set forth below
under this "Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations" and elsewhere in this report. Actual
results will most likely differ from those reflected in these statements, and
the differences could be substantial. We disclaim any obligation to publicly
update these statements, or disclose any difference between our actual results
and those reflected in these statements. The information constitutes
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995.

Overview

     We conduct our business through our subsidiaries. Through our 80% owned
MSV Investors Subsidiary, we are an active participant in the MSV Joint
Venture, a joint venture that also includes TMI, Motient, and the Other MSV
Investors. The MSV Joint Venture is currently a provider of mobile digital
voice and data communications services via satellite in North America. We have
designated three members of the 12-member board of directors of the MSV Joint
Venture's corporate general partner. In addition, in May 2002, we became
affiliated with Miraxis, a development stage company that has access to a
Ka-band license with which it intends to provide satellite based
multi-channel, broadband data and video services in North America.

     On February 10, 2003, the FCC released the ATC Order that relates to an
application submitted by the MSV Joint Venture and certain of its competitors
that could greatly expand the scope of the MSV Joint Venture's business by
permitting the incorporation of an ancillary terrestrial component into its
mobile satellite network. A similar application is pending before Industry
Canada, the FCC's counterpart in Canada. The MSV Joint Venture cannot expand
its mobile satellite services business using ATC base stations into Canada
until this application pending before Industry Canada is approved. With the
FCC's issuance of the ATC Order alone, however, we expect the MSV Joint
Venture to enter a new stage of development which will require significant
future funding requirements and/or a need for one or more strategic partners.

     Our current operations consist of actively participating in the MSV Joint
Venture, directing the operations of Miraxis and seeking other complementary
operational opportunities. Our principal assets consist of our interest in the
MSV Joint Venture, a promissory note from Motient, our interest in Miraxis,
our remaining investments in our venture portfolio companies and cash, cash
equivalents and short-term investments. As a result of uncertainty with
respect to the ultimate collection on the Motient note, we recognized a
reserve for the entire amount of the note. See "Liquidity and Capital
Resources" under this Item 2.

     From 1998 through the third quarter of 2001, our principal business was
conducted through Rare Medium, Inc., which developed Internet e-commerce
strategies, business processes, marketing communications, branding strategies
and interactive content using Internet-based technologies and solutions. As a
result of the weakening of general economic conditions that caused many
companies to reduce spending on Internet-focused business solutions and in
light of their performance and prospects, a decision to discontinue Rare
Medium, Inc.'s operations, along with those of its LiveMarket subsidiary, was
made at the end of the third quarter of 2001.

     From 1999 through the first quarter of 2001, we made venture investments
by taking strategic minority equity positions in other independently managed
companies. Additionally, during that period, we developed, managed and
operated our Start-up Companies. During the first quarter of 2001, we reduced
our focus on these businesses and substantially ceased providing funding to
our Start-up Companies.

     As a result of the decision to discontinue the operations of Rare Medium,
Inc. and its subsidiary LiveMarket, the results of operations of these
businesses have also been accounted for as discontinued operations.
Accordingly, our discussion in the section entitled "Results of Operations"
focuses on our continuing operations and includes our results and those of our
MSV Investors Subsidiary and our Start-up Companies up to their respective
dates of sale or dissolution.


Results of Operations for the Three Months Ended March 31, 2003 Compared to the
Three Months Ended March 31, 2002

   Selling, General and Administrative Expense

     Selling, general and administrative expense includes facilities costs,
finance, legal and other corporate costs, as well as the salaries and related
employee benefits for those employees that support such functions. Selling,
general and administrative expense for the three months ending March 31, 2003
decreased to $1.9 million from $2.6 million for the three months ended March
31, 2002, a decrease of $0.7 million. This decrease was primarily related to
the $1.1 million charge recognized in the three months ended March 31, 2002
related to the settlement of the class action lawsuit and the reduced legal
and advisory fees after the settlement of the class action lawsuit, partially
offset by the approximately $0.4 million charge recognized in the three months
ended March 31, 2003 relating to the severance for the Company's former
Controller and former Treasurer. As these costs relate to our current
operations, we expect our selling, general and administrative expense to
remain approximately at this level in future periods.

   Depreciation and Amortization Expense

     Depreciation and amortization expense consists of the depreciation of
property and equipment and the amortization of the financing costs associated
with the issuance of our Series A convertible preferred stock. Depreciation
and amortization expense for the three months ended March 31, 2003 decreased
to approximately $7,000 from $29,000 for the three months ended March 31,
2002, a decrease of approximately $22,000. This decrease is primarily the
result of the reduction in property and equipment used in our continuing
operations. As our capital expenditures remain nominal, we expect depreciation
and amortization expense to remain at this level in future periods.

   Interest Income, Net

     Interest income, net for the three months ended March 31, 2003 is mainly
comprised of the interest earned on our cash, cash equivalents, and short-term
investments and on our convertible notes receivable from the MSV Joint
Venture.

   Loss on Investment in Affiliates

     For the three months ended March 31, 2003, we recorded a loss on
investments in affiliates of approximately $0.1 million for our proportionate
share of Miraxis' operating loss. For the three months ended March 31, 2002,
we did not record any losses on investments in affiliates. We will continue to
monitor the carrying value our remaining investments in affiliates.

   Minority Interest

     For the three months ended March 31, 2003, we recorded minority interest
of approximately $0.3 million relating to the equity in earnings, primarily
the interest income earned on the convertible notes from the MSV Joint
Venture, which is attributable to the group of unaffiliated third parties who
invested approximately $10.2 million in our MSV Investors Subsidiary.

   Gain from Discontinued Operations

     At the end of the third quarter of 2001, a decision to discontinue the
operations of Rare Medium, Inc. and its LiveMarket subsidiary was made in
light of their performance and prospects. For the three months ended March 31,
2003, we recognized a gain of approximately $0.5 million as a result of the
settlement of Rare Medium, Inc. liabilities at amounts less than their
recorded amounts. For the three months ended March 31, 2002, we did not
recognize any charges or benefits relating to these companies.

   Net Loss

     For the three months ended March 31, 2003, we recorded a net loss of
approximately $0.3 million. The loss was primarily due to the factors
described in "Selling, General and Administrative Expense," "Depreciation and
Amortization Expense," "Interest Income, Net," "Loss on Investments in
Affiliates," "Minority Interest" and "Gain from Discontinued Operations."


     Included in net loss attributable to common shareholders of $2.7 million
was approximately $2.4 million of non-cash deemed dividends and accretion
related to the issuance of our Series A convertible preferred stock. Dividends
were accrued related to the pay-in-kind dividends payable quarterly on Series
A convertible preferred stock and to the accretion of the carrying amount of
the Series A convertible preferred stock up to its $100 per share face
redemption amount over 13 years.

Liquidity and Capital Resources

     We had $37.7 million in cash, cash equivalents and short-term investments
as of March 31, 2003. Cash used in operating activities from continuing
operations was $1.4 million for the three months ended March 31, 2003 and
resulted primarily from cash used for general corporate overhead including
payroll and professional fees. We expect cash used in continuing operations to
remain at approximately this level in future periods. Cash used by
discontinued operations was $0.4 million for the three months ended March 31,
2003.

     For the three months ended March 31, 2003, cash provided by investing
activities from continuing operations was approximately $1.5 million and
resulted primarily from the proceeds resulting from the sale of short-term
investments. We do not have any future funding commitments with respect to any
of our investments. However, we expect that the MSV Joint Venture and Miraxis
will require additional funding from time to time, and we may choose to
provide additional funding, subject to our liquidity and capital resources at
the time.

   Motient Promissory Notes

     On May 1, 2002, to mitigate the risk, uncertainties and expenses
associated with Motient's plan of reorganization, we cancelled the outstanding
amounts due under the original promissory notes issued by Motient and accepted
a new note in the principal amount of $19.0 million that was issued by MSV
Holding, Inc., a new, wholly-owned subsidiary of Motient that owns 100% of
Motient's interests in the MSV Joint Venture. The New Motient Note is due on
May 1, 2005 and bears interest at a rate of 9% per annum. Although the New
Motient Note is unsecured, there are material restrictions placed on the use
of MSV Holdings Inc.'s assets, and MSV Holdings Inc. is prohibited from
incurring or guarantying any debt in excess of $21.0 million (including the
New Motient Note). Additionally, there are events of default (e.g., a
bankruptcy filing by Motient) that would accelerate the due date of the New
Motient Note. As a result of the uncertainty with respect to the ultimate
collection on the New Motient Note, a reserve continues to be maintained for
the entire amount of the note. If we recover any amount on the New Motient
Note, adjustments to the reserve would be reflected as other income on the
accompanying consolidated statements of operations. Furthermore, we have been
conducting periodic discussions with Motient concerning alternatives related
to the New Motient Note including the exchange of such note, or a portion
thereof, into an additional equity interest in the MSV Joint Venture.

   MSV Joint Venture Convertible Note Receivable

     Through our 80% owned MSV Investors Subsidiary, we are an active
participant in the MSV Joint Venture, a joint venture that also includes TMI,
Motient and the Other MSV Investors. The MSV Joint Venture is currently a
provider of mobile digital voice and data communications services via
satellite in North America. On November 26, 2001, through our MSV Investors
Subsidiary, we purchased a $50.0 million interest in the MSV Joint Venture in
the form of a convertible note. Immediately prior to the purchase of the
convertible note, Rare Medium Group contributed $40.0 million to the MSV
Investors Subsidiary and a group of unaffiliated third parties collectively
contributed $10.0 million. The note bears interest at a rate of 10% per year,
has a maturity date of November 26, 2006, and is convertible at any time at
the option of our MSV Investors Subsidiary into equity interests in the MSV
Joint Venture.

     On August 13, 2002, the MSV Joint Venture completed a rights offering
allowing its investors to purchase their pro rata share of an aggregate $3.0
million of newly issued convertible notes with terms similar to the
convertible note already held by our MSV Investors Subsidiary. The MSV
Investors Subsidiary exercised its basic and over subscription rights and
purchased approximately $1.1 million of the convertible notes. Following this
purchase of the additional convertible note, the MSV Investors would own, upon
conversion, 30.9% of the equity interests in the MSV Joint Venture. The group
of unaffiliated third parties collectively contributed $0.2 million to the MSV
Investors Subsidiary in connection with the MSV Joint Venture rights offering.


     Pursuant to the MSV Joint Venture Agreement, in the event that the MSV
Joint Venture had received final regulatory approval from the FCC, as that
phrase is defined in the MSV Joint Venture Agreement, by March 31, 2003 for
its ATC applications, the Other MSV Investors would have been obligated to
invest an additional $50.0 million in the MSV Joint Venture. As the final
regulatory approval from the FCC, as defined by the MSV Joint Venture
Agreement, was not received by March 31, 2003, the additional investment was
not required. However, the Other MSV Investors retain the option to invest the
$50.0 million at the same terms and conditions until June 30, 2003. If this
additional investment were to occur, the convertible notes held by our MSV
Investors Subsidiary will automatically convert into equity interests, and the
MSV Investors Subsidiary would own approximately 23.7% of the equity interests
in the MSV Joint Venture.

     The fair value of the convertible notes approximates book value based on
the equity value of the MSV Joint Venture's recent funding transactions
assuming conversion of such note.

   Other Transactions

     As part of our regular on-going evaluation of business opportunities, we
are currently engaged in a number of separate and unrelated preliminary
discussions concerning possible joint ventures and other transactions
(collectively, the "Transactions"). We are in the early stages of such
discussions and have not entered into any agreement in principle with respect
to any of the Transactions. Prior to consummating any Transaction, we will
have to, among other things, initiate and satisfactorily complete a due
diligence investigation, negotiate the financial and other terms (including
price) and conditions of such Transaction, obtain appropriate board of
directors', regulatory and other necessary consents and approvals and secure
financing, to the extent deemed necessary. We cannot predict if any such
Transaction will be consummated or, if consummated, will result in a financial
or other benefit to us.

   Tender Offer

     On March 13, 2003, we commenced a cash tender offer at a price of $1.00
per share for up to 2,500,000 shares, or approximately 35.5% of our
outstanding voting common stock. The tender offer expired on April 23, 2003
with 968,398 shares purchased by us for an aggregate cost, including all fees
and expenses applicable to the tender offer, of approximately $1.2 million.
The primary purpose of the tender offer was to provide our public stockholders
with additional liquidity for their shares of common stock, particularly in
light of decreased liquidity arising from the decision of Nasdaq to delist our
common stock, and to do so at a premium over the stock price before the tender
offer and without the usual transaction costs associated with open market
sales. Our preferred stockholders did not sell any shares of common stock in
the tender offer.

Recently Issued Accounting Standards

     In December 2002, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards No. 148, "Accounting for
Stock-Based Compensation - Transition and Disclosure" ("SFAS No. 148"). SFAS
No. 148 amends SFAS No. 123, "Stock-Based Compensation" ("SFAS No. 123"), to
provide alternative methods of transition for an entity that voluntarily
changes to the fair value based method of accounting for stock-based employee
compensation. In addition, SFAS No. 148 amends the disclosure requirements of
SFAS No. 123 to require prominent disclosure in both annual and interim
financial statements about the effects on reported net income of an entity's
method of accounting for stock-based employee compensation. The disclosure
provisions of SFAS No. 148 are effective for fiscal years ending after
December 15, 2002 and have been incorporated into the accompanying financial
statements and footnotes. However, the FASB recently indicated that they would
require stock-based employee compensation to be recorded as a charge to
earnings beginning in 2004. We will continue to monitor their progress on the
issuance of this standard, as well as evaluate our position with respect to
current guidance.

     In January 2003, the FASB issued Interpretation No. 46, "Consolidation of
Variable Interest Entities, an Interpretation of ARB No. 51" ("FIN No. 46").
FIN No. 46 provides clarification on the consolidation of certain entities
that do not have sufficient equity at risk for the entity to finance its
activities without additional subordinated financial support from other
parties or in which equity investors do not have certain characteristics of a
controlling financial interest ("variable interest entities" or "VIEs"). FIN
No. 46 requires that VIEs be consolidated by the entity considered to be the
primary beneficiary of the VIE and is effective immediately for VIEs created
after January 31, 2003 and in the first fiscal year or interim period ending
after June 15, 2003 for any VIEs created prior to January 31, 2003. We are
currently reviewing our investments and other arrangements to determine
whether any of our investee companies are VIEs. We do not expect to identify
any significant VIEs that would need to be consolidated and, consequently,
believe the adoption of FIN No. 46 will not have a material impact on our
consolidated financial position or results of operations.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

     At March 31, 2003, we had $37.7 million of cash, cash equivalents and
short-term cash investments. These cash, cash equivalents and short-term cash
investments are subject to market risk due to changes in interest rates. In
accordance with our investment policy, we diversify our investments among
United States Treasury securities and other high credit quality debt
instruments that we believe to be low risk. We are averse to principal loss
and seek to preserve our invested funds by limiting default risk and market
risk.

Item 4.  Controls and Procedures

     Within 90 days prior to the date of this report, we carried out an
evaluation, under the supervision and with the participation of our chief
executive officer and principal accounting officer, of the effectiveness of
the design and operation of our disclosure controls and procedures. Based on
this evaluation, our chief executive officer and principal accounting officer
concluded that our disclosure controls and procedures, as of the date of the
evaluation, are effective in timely alerting them to material information
required to be included in our periodic SEC reports. It should be noted that
the design of any system of controls is based in part upon certain assumptions
about the likelihood of future events, and there can be no assurance that any
design will succeed in achieving its stated goals under all potential future
conditions, regardless of how remote.

      In addition, we reviewed our internal controls, and there have been no
significant changes in those controls or in other factors that could
significantly affect those controls subsequent to the date of their last
evaluation.

                                    PART II
                               OTHER INFORMATION

Item 1.  Legal Proceedings

     A number of class action lawsuits were filed by the holders of our common
stock against us and members of our board of directors in the Court of
Chancery of the State of Delaware challenging the plan of merger with Motient
Corporation that was ultimately terminated on October 1, 2001. On June 22,
2001, the Delaware court entered an order to consolidate all of the Delaware
lawsuits for all purposes into a single class action, In re Rare Medium Group,
Inc. Shareholders Litigation, C.A. No. 18879-NC. On April 2, 2002, we entered
into a settlement in which we agreed to effectuate a reverse stock split,
commence a rights offering and take certain other corporate actions to settle
the consolidated action. The court approved the settlement on December 2,
2002. In connection with the settlement, on January 10, 2003, we issued
357,143 shares of our common stock to the plaintiff's counsel as attorney's
fees and paid the plaintiff's counsel $0.1 million for expenses.

     On May 16, 2001, plaintiffs Jay M. Wolff, David Bliss, Tim Barber and
Steve O'Brien filed suit against Rare Medium, Inc., Rare Medium Group, Inc.,
and Rare Medium Texas I, Inc. in the United States District Court for the
Southern District of New York, Wolff, et al. v. Rare Medium, Inc., et al., CV
No 01-4279. The plaintiffs asserted claims for breach of contract, tortious
interference with contractual relations, tortious interference with
prospective advantage, and breach of implied obligation of good faith, arising
out of the plaintiffs' alleged attempt to engage in transactions involving
some or all of the approximately 1,200,000 shares of our common stock (prior
to the reverse stock split) that the plaintiffs obtained in our acquisition of
Big Hand, Inc. The plaintiffs sought unspecified compensatory and punitive
damages, interest, attorneys' fees and costs. On October 31, 2001, the Court
dismissed the case without prejudice. The plaintiffs filed an amended
complaint on December 7, 2001 based on substantially the same alleged facts.
The amended complaint asserts the following causes of action: (1) breach of
contract; (2) tortious interference with contract; and, (3) tortious
interference with prospective business advantage. The amended complaint also
sought an unspecified amount of actual damages, punitive damages, interest,
and costs. On June 27, 2002, the Court dismissed the case with prejudice. On
July 16, 2002, the plaintiffs filed a notice of appeal. On October 31, 2002,
plaintiffs filed their brief in support of their appeal. We filed our
opposition on December 16, 2002, and the plaintiffs replied on January 15,
2003. The Court of Appeals heard oral arguments on the appeal on February 27,
2003. On March 14, 2003, the Court of Appeals denied the appeal in its
entirety. On April 11, 2003, the Court of Appeals denied a request for
rehearing. We intend to continue to vigorously contest any future actions with
respect to this matter.

     On November 19, 2001, five of our shareholders filed a complaint against
us, certain of our subsidiaries and certain of their current and former
officers and directors in the United States District Court for the Southern
District of New York, Dovitz v. Rare Medium Group, Inc. et al., No. 01 Civ.
10196. Plaintiffs became owners of restricted stock when they sold the company
that they owned to us. Plaintiffs assert the following four claims against
defendants: (1) common-law fraud; (2) violation of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder; (3)
violation of the Michigan Securities Act; and (4) breach of fiduciary duty.
These claims arise out of alleged representations by defendants to induce
plaintiffs to enter into the transaction. The complaint seeks compensatory
damages of approximately $5.6 million, exemplary and/or punitive damages in
the same amount, as well as attorney fees. On January 25, 2002, we filed a
motion to dismiss the complaint in its entirety. On June 3, 2002, the Court
dismissed the matter without prejudice. On or about July 17, 2002, the
plaintiffs filed an amended complaint asserting similar causes of action to
those asserted in the original complaint. On September 12, 2002, we filed a
motion to dismiss on behalf of our self and our current and former officers
and directors. On November 5, 2002, the plaintiffs filed a brief in opposition
to the motion to dismiss. We replied on December 9, 2002. On March 7, 2003,
the Court denied the motion to dismiss. We intend to continue to dispute this
matter vigorously.

     We and certain of our subsidiaries (along with the Engelhard Corporation)
are parties to an arbitration relating to certain agreements that existed
between or among the claimant and ICC Technologies, Inc., our former name, and
the Engelhard/ICC ("E/ICC") joint venture arising from the desiccant air
conditioning business that we and our subsidiaries sold in 1998. The claimant
has sought $8.5 million for (a) its alleged out of pocket losses in investing
in certain of E/ICC's technology, (b) unjust enrichment resulting from the
reorganization of E/ICC in 1998, and (c) lost profits arising from the fact
that it was allegedly forced to leave the air conditioning business when the
E/ICC joint venture was dissolved. We intend to vigorously dispute this
action.

     On July 26, 2002, plaintiffs James D. Loeffelbein, Terrie L. Pham and
certain related parties filed suit against the lead plaintiff's counsel in the
class action lawsuit, us, certain of our current and former officers, our
former investor relations firm and a former employee of plaintiff Loeffelbein
in the District Court of Johnson County, Kansas, Loeffelbein v. Milberg Weiss
Bershad Hynes & Lerach, LLP, et al., 02 CV 04867. The plaintiffs assert claims
for fraud, negligence and breach of fiduciary duty against all of us and
certain of our current and former officers in connection with allegedly false
statements purportedly made to the plaintiffs. The plaintiffs have sought
unspecified damages from the defendants. On September 11, 2002, the matter was
removed to the United States District Court for the District of Kansas. On
October 11, 2002, the plaintiffs sought to have the matter remanded to state
court. We opposed this motion and intend to dispute this matter vigorously.

Item 2.  Changes in Securities

     (a) Not applicable
     (b) Not applicable
     (c) Not applicable
     (d) Not applicable

Item 3.  Defaults Upon Senior Securities

     Not applicable

Item 4.  Submissions of Matters to a Vote of Security Holders

     None

Item 5.  Other Information

     None

Item 6.  Exhibits and Reports on Form 8-K

(a) The following sets forth those exhibits filed pursuant to Item 601 of
    Regulation S-K:

      Exhibit
       Number                                               Description
       ------                                               -----------

     99.1      - Certification Pursuant to 18 U.S.C Section 1350, as adopted
                  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b)      The following sets forth the Company's reports on Form 8-K that have
         been filed during the quarter for which this report is filed:

         None
<PAGE>



                                  SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.


Date:  May 15, 2003                   By: /s/ JEFFREY A. LEDDY
                                          -------------------------------------
                                          Jeffrey A. Leddy
                                          Chief Executive Officer and President
                                          (Principal Executive Officer and
                                          Principal Financial Officer)

Date:  May 15, 2003                   By: /s/ CRAIG J. KAUFMANN
                                          -------------------------------------
                                          Craig J. Kaufmann
                                          Controller and Treasurer
                                          (Principal Accounting Officer)
<PAGE>



                                CERTIFICATIONS

I, Jeffrey A. Leddy, certify that:

1.       I have reviewed this quarterly report on Form 10-Q of Rare Medium
         Group, Inc.;

2.       Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

3.       Based on my knowledge, the financial statements, and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         this quarterly report;

4.       The registrant's other certifying officer and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
         and we have:

         a)    designed such disclosure controls and procedures to ensure that
               material information relating to the registrant, including its
               consolidated subsidiaries, is made known to us by others within
               those entities, particularly during the period in which this
               quarterly report is being prepared;

         b)    evaluated the effectiveness of the registrant's disclosure
               controls and procedures as of a date within 90 days prior to
               the filing date of this quarterly report (the "Evaluation
               Date"); and

         c)    presented in this quarterly report our conclusions about the
               effectiveness of the disclosure controls and procedures based
               on our evaluation as of the Evaluation Date;

5.       The registrant's other certifying officer and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of registrant's board of directors (or persons
         performing the equivalent function):

         a)    all significant deficiencies in the design or operation of
               internal controls which could adversely affect the registrant's
               ability to record, process, summarize and report financial data
               and have identified for the registrant's auditors any material
               weaknesses in internal controls; and

         b)    any fraud, whether or not material, that involves management or
               other employees who have a significant role in the registrant's
               internal controls; and

6.       The registrant's other certifying officer and I have indicated in
         this quarterly report whether or not there were significant changes
         in internal controls or in other factors that could significantly
         affect internal controls subsequent to the date of our most recent
         evaluation, including any corrective actions with regard to
         significant deficiencies and material weaknesses.



         Date:  May 15, 2003          By:  /s/ JEFFREY A. LEDDY
                                          -------------------------------------
                                          Jeffrey A. Leddy
                                          Chief Executive Officer and President
                                          (Principal Executive Officer and
                                          Principal Financial Officer)

<PAGE>

                                CERTIFICATIONS

I, Craig J. Kaufmann, certify that:

1.       I have reviewed this quarterly report on Form 10-Q of Rare Medium
         Group, Inc.;

2.       Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

3.       Based on my knowledge, the financial statements, and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         this quarterly report;

4.       The registrant's other certifying officer and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
         and we have:

a)            designed such disclosure controls and procedures to ensure that
              material information relating to the registrant, including its
              consolidated subsidiaries, is made known to us by others within
              those entities, particularly during the period in which this
              quarterly report is being prepared;

b)            evaluated the effectiveness of the registrant's disclosure
              controls and procedures as of a date within 90 days prior to the
              filing date of this quarterly report (the "Evaluation Date");
              and

c)            presented in this quarterly report our conclusions about the
              effectiveness of the disclosure controls and procedures based on
              our evaluation as of the Evaluation Date;

5.       The registrant's other certifying officer and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of registrant's board of directors (or persons
         performing the equivalent function):

a)                all significant deficiencies in the design or operation of
                  internal controls which could adversely affect the
                  registrant's ability to record, process, summarize and
                  report financial data and have identified for the
                  registrant's auditors any material weaknesses in internal
                  controls; and

b)                any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal controls; and

6.       The registrant's other certifying officer and I have indicated in
         this quarterly report whether or not there were significant changes
         in internal controls or in other factors that could significantly
         affect internal controls subsequent to the date of our most recent
         evaluation, including any corrective actions with regard to
         significant deficiencies and material weaknesses.



         Date:  May 15, 2003           By:  /s/ CRAIG J. KAUFMANN
                                           ------------------------------------
                                           Craig J. Kaufmann
                                           Controller and Treasurer
                                           (Principal Accounting Officer)
<PAGE>


                           CERTIFICATION PURSUANT TO
                            18 U.S.C. SECTION 1350,
                            AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Quarterly Report on Form 10-Q of Rare Medium
Group, Inc. (the "Company") for the quarterly period ended March 31, 2003 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), Jeffrey A. Leddy as Chief Executive Officer and President of the
Company and Craig J. Kaufmann as Controller and Treasurer of the Company, each
hereby certifies, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss.
906 of the Sarbanes-Oxley Act of 2002, that:

     (1)  The Report fully complies with the requirements of Section 13(a) or
          15(d) of the Securities Exchange Act of 1934; and

     (2)  The information contained in the Report fairly presents, in all
          material respects, the financial condition and results of operations
          of the Company.


                           By:   /s/ JEFFREY A. LEDDY
                                 -------------------------------------
                                 Name:   Jeffrey A. Leddy
                                 Title:  Chief Executive Officer and President
                                         (Principal Executive Officer and
                                            Principal Financial Officer)
                                 Date:   May 15, 2003

                           By:   /s/ CRAIG J. KAUFMANN
                                 -------------------------------------
                                 Name:   Craig J. Kaufmann
                                 Title:  Controller and Treasurer
                                         (Principal Accounting Officer)
                                 Date:   May 15, 2003


     This certification accompanies the Report pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the
Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of
ss.18 of the Securities Exchange Act of 1934, as amended.