================================================================================

                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                              _____________________

                                   FORM 10-QSB

(Mark One)

     [X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
          ACT OF 1934

                 For the quarterly period ended: March 31, 2005

                                       OR

     [ ]  TRANSITION  REPORT  UNDER  SECTION  13 OR 15(d)  OF THE  SECURITIES
          EXCHANGE ACT OF 1934

      For the transition period from _________________ to ________________

                        Commission file number: 000-16299
                                ________________

                               ANTS SOFTWARE INC.
             (Exact name of registrant as specified in its charter)


        Delaware                                        13-3054685
(State or other jurisdiction of             (IRS Employer Identification Number)
Incorporation or Organization)


       700 Airport Blvd. Suite 300, Burlingame, CA             94010
         (Address of principal executive offices)            (Zip Code)

                                 (650) 931-0500
              (Registrant's Telephone Number, including area code)

                  801 Mahler Rd. Suite G, Burlingame, CA 94010
              (Former name, former address and former fiscal year,
                         if changed since last report)

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  period that the  registrant  was
required to file reports),  and (2) has been subject to such filing requirements
for the past 90 days.
Yes [X]    No [   ]

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

             37,757,181 shares of common stock as of March 31, 2005

Transitional Small Business Disclosure Format:  Yes [ ]    No [X]


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<PAGE>


                                TABLE OF CONTENTS

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                     PART I. Financial Information
<S>  <C>                                                                                             <C>
Item 1.  Financial Statements ........................................................................3-10
Item 2.  Management's Plan of Operation  ............................................................10-15
Item 3.  Controls and Procedures  ......................................................................15

                                                      PART II. Other Information

Item 1. Legal Proceedings  .............................................................................15
Item 2. Unregistered Sales of Equity Securities .....................................................15-16
Item 3. Defaults Upon Senior Securities.................................................................16
Item 4. Submission of Matters to a Vote of Security Holders.............................................16
Item 5. Other Information...............................................................................16
Item 6. Exhibits.....................................................................................16-17
Risk Factors.........................................................................................17-20
Signatures..............................................................................................20


</TABLE>



                                       2
<PAGE>

                          PART I. FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                               ANTS SOFTWARE INC.
                                 BALANCE SHEETS
                                  ____________

<TABLE>
<CAPTION>

                                                                                    March 31,      December 31,
                                                                                      2005             2004
                                     ASSETS                                        (Unaudited)      (Audited)
                                                                                 ---------------- ----------------
<S>                                                                                  <C>              <C>
Current assets:
   Cash                                                                              $ 3,360,775      $ 1,448,724
   Accounts receivable                                                                   114,100                -
   Prepaid insurance                                                                           -           21,375
   Prepaid expenses                                                                       25,593           65,292
                                                                                 ---------------- ----------------
          Total current assets                                                         3,500,468       1,535,391
                                                                                 ---------------- ----------------
   Computers and software                                                              1,117,839          949,046
   Office furniture and fixtures                                                          29,386           29,386
   Leasehold improvements                                                                 46,169           16,675
   Less accumulated depreciation                                                        (735,925)        (670,982)
                                                                                 ---------------- ----------------
          Property and equipment, net                                                    457,469          324,125
                                                                                 ---------------- ----------------
Other assets - security deposits                                                           9,100            9,100
                                                                                 ---------------- ----------------
          Total assets                                                               $ 3,967,037      $ 1,868,616
                                                                                 ================ ================

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable and accrued expenses                                              $  240,578       $  333,916
   Bonuses payable                                                                       199,167                -
   Deferred revenues                                                                      27,333                -
   Capital lease payable                                                                   4,365            4,871
                                                                                 ---------------- ----------------
          Total current liabilities                                                      471,443          338,787
                                                                                 ---------------- ----------------
Long-term liabilities:
   Capital lease payable                                                                      -              648
                                                                                 ---------------- ----------------
          Total liabilities                                                             471,443          339,435
                                                                                 ---------------- ----------------
Commitment and contingencies

Stockholders' equity:
   Preferred stock, $0.0001 par value; 50,000,000 shares authorized,
         no shares issued and outstanding in 2005 and 2004, respectively                       -                -
   Common stock, $0.0001 par value; 100,000,000 shares authorized;
     37,757,181 and 35,298,817 shares issued and outstanding, respectively                 3,776            3,530
   Common stock subscribed, not issued                                                 1,049,000           30,000
   Additional paid-in capital                                                         39,062,325       36,316,987
   Accumulated deficit                                                               (36,619,507)     (34,821,336)
                                                                                 ---------------- ----------------
          Total stockholders' equity                                                   3,495,594        1,529,181
                                                                                 ---------------- ----------------
Total liabilities and stockholders' equity                                           $ 3,967,037      $ 1,868,616
                                                                                 ================ ================

         The accompanying notes are an integral part of these condensed financial statements.

</TABLE>



                                       3
<PAGE>

                                       ANTS SOFTWARE INC.
                                    STATEMENTS OF OPERATIONS
                                          ____________

<TABLE>
<CAPTION>

                                                             Three Months ended March 31,
                                                              2005                  2004
                                                           (Unaudited)          (Unaudited)
                                                      --------------------------------------------
<S>                                                             <C>                    <C>
Revenues:
   Licenses                                                $     86,100              $       --
   Maintenance                                                      667                      --
                                                     --------------------------------------------
         Total revenues                                          86,767                      --
Expenses:
   Sales and marketing                                          575,359                   145,270
   Research and development                                     787,089                   459,468
   General and administrative                                   525,603                   346,890
                                                     --------------------------------------------
         Total expenses                                       1,888,051                   951,628
                                                     --------------------------------------------
          Loss from operations                               (1,801,284)                 (951,628)
                                                     --------------------------------------------

Other income (expense):
   Income earned from expired contract                             --                     310,943
   Interest income                                                2,528                     2,083
   Gain on legal settlement                                       1,500                     2,000
   Write-off of officer's note receivable for
      stock purchases                                              --                     (45,000)
   Interest expense                                                (915)                  (87,544)
                                                     --------------------------------------------
          Other income (expense), net                             3,113                   182,482
                                                     --------------------------------------------
          Net loss                                         $ (1,798,171)             $   (769,146)
                                                     ============================================

Basic and diluted net loss per common share                $      (0.05)             $      (0.03)
                                                     ============================================
Shares used in computing basic and diluted net
   loss per share                                            37,176,396                27,561,702
                                                     ============================================

        The accompanying notes are an integral part of these condensed financial statements.

</TABLE>



                                       4
<PAGE>

                               ANTS SOFTWARE INC.
                            STATEMENTS OF CASH FLOWS
                                  ____________

<TABLE>
<CAPTION>
                                                                                    Three Months ended March 31,
                                                                                        2005           2004
                                                                                    (Unaudited)    (Unaudited)
                                                                                    -----------    -----------
<S>                                                                                  <C>           <C>
Cash flows from operating activities:
   Net loss                                                                         $(1,798,171)   $  (769,146)
   Adjustments to reconcile net loss to net cash used in operating activities:
     Depreciation and amortization                                                       64,943         43,613
     Amortization of debt discount and beneficial conversion feature                       --           86,601
     Compensation expense recognized on options granted to non-employees                  4,672           --
     Write-off of note receivable to officer for stock purchases                           --           45,000
   Changes in operating assets and liabilities:
     Prepaid insurance and expenses                                                      61,075         38,863
     Accounts receivable                                                               (114,100)          --
     Accounts payable and other accrued expenses                                        (93,338)        44,508
     Bonuses payable                                                                    199,167           --
     Deferred salaries                                                                     --           19,703
     Deferred revenue                                                                    27,333       (310,943)
                                                                                    -----------    -----------
          Net cash used in operating activities                                      (1,648,419)      (801,801)
                                                                                    -----------    -----------

Cash flows used in investing activities--purchases of property and equipment, net      (198,287)       (36,995)
                                                                                    -----------    -----------
Cash flows from financing activities:
   Proceeds from private placements, net of commissions                                 842,650      4,008,280
   Proceeds from exercise of options                                                     25,416        164,290
   Proceeds from common stock subscribed for warrant exercises                        1,049,000           --
   Proceeds from exercise of warrants, net of commissions                             1,842,846           --
   Payments on capital lease obligations                                                 (1,155)          (769)
                                                                                    -----------    -----------
          Net cash provided by financing activities                                   3,758,757      4,171,801
                                                                                    -----------    -----------
Net increase in cash                                                                  1,912,051      3,333,005
                                                                                    -----------    -----------
Cash at beginning of period                                                           1,448,724        541,725
                                                                                    -----------    -----------
Cash at end of period                                                               $ 3,360,775    $ 3,874,730
                                                                                    ===========    ===========
Supplemental disclosures of cash flow information:
   Cash paid during the period for:
         Interest                                                                   $       915    $       694
          Taxes                                                                            --             --
Non-cash investing and financing activities:
      Common stock issued for subscribed shares                                          30,000           --


        The accompanying notes are an integral part of these condensed financial statements
</TABLE>



                                       5
<PAGE>

                               ANTS SOFTWARE INC.
                     NOTES TO CONDENSED FINANCIAL STATEMENTS

1.      BASIS OF PRESENTATION

     The accompanying  unaudited condensed financial statements are presented in
accordance with the  requirements  for Form 10-QSB and Item 310(b) of Regulation
S-B.  Accordingly,  they do not include all the disclosures normally required by
generally accepted accounting  principles.  Reference should be made to the ANTs
software inc. (the  "Company")  Form 10-KSB for the twelve months ended December
31,  2004,  for  additional  disclosures  including  a summary of the  Company's
accounting policies, which have not significantly changed.

     The information  furnished reflects all adjustments (all of which were of a
normal recurring nature), which, in the opinion of management,  are necessary to
make the financial statements not misleading and to fairly present the financial
position, results of operations, and cash flows on a consistent basis. Operating
results for the three months  ended March 31, 2005 and 2004 are not  necessarily
indicative of the results that may be expected in the future.

     The accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America,  which
contemplates continuation of the Company as a going concern.

     Management has evaluated the Company's current  financial  position and its
available  resources and plans to raise additional funds through the issuance of
equity  securities  during 2005 and possibly  thereafter.  Should the Company be
unsuccessful in raising  additional  funds, it is unlikely that the Company will
continue operations beyond November 30, 2005.

2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Revenue   Recognition  -  We  recognize  revenue  in  accordance  with  the
provisions   of  Statement  of  Position   ("SOP")   97-2,   "Software   Revenue
Recognition",  and  SOP  98-9,  "Modification  of  SOP  97-2,  Software  Revenue
Recognition,  With Respect to Certain Transactions".  Revenue consists primarily
of revenue earned under software  license  agreements  and  maintenance  support
agreements (otherwise known as post-contract customer support or "PCS").

     We use the residual  method to recognize  revenue when a license  agreement
includes one or more  elements to be delivered at a future date.  If there is an
undelivered  element  under the license  arrangement,  we defer revenue based on
vendor-specific   objective  evidence,  or  VSOE,  of  the  fair  value  of  the
undelivered element, as determined by the price charged when the element is sold
separately.  If VSOE of fair value does not exist for all undelivered  elements,
we defer all revenue until sufficient  evidence exists or all elements have been
delivered.  Under the  residual  method,  discounts  are  allocated  only to the
delivered  elements  in a  multiple  element  arrangement  with any  undelivered
elements  being  deferred  based  on  VSOE of fair  values  of such  undelivered
elements.

     Revenue from software license  arrangements,  including prepaid license and
maintenance  support fees, is recognized when all of the following  criteria are
met:

     o    Persuasive evidence of an arrangement exists.

     o    Delivery  has  occurred  and there are no future  deliverables  except
          post-contract customer support ("PCS").

     o    The fee is fixed and determinable. If we cannot conclude that a fee is
          fixed and  determinable,  then  assuming all other  criteria have been
          met,  revenue is recognized as payments  become due in accordance with
          paragraph 29 of SOP 97-2; and

     o    Collection is probable.

     Basic  And  Diluted  Net Loss  Per  Share - Basic  net  loss  per  share is
calculated  in  accordance  with FASB 128 using the  weighted-average  number of
common  shares  outstanding  during the  period.  Diluted  net loss per share is



                                       7
<PAGE>

computed  using  the  weighted-average  number  of common  and  dilutive  common
equivalent shares outstanding during the period.

     The following  table presents the calculation of basic and diluted net loss
per share:

<TABLE>
<CAPTION>

                                                                     Three Months ended
                                                                         March 31,
                                                               -------------------------------
                                                                    2005           2004
                                                               -------------------------------
<S>                                                             <C>            <C>
                 Net loss                                       $(1,798,171)   $    (769,146)
                 Weighted average shares of common stock
                    outstanding - basic and dilutive             37,176,396       27,561,702
                                                               -------------------------------
                 Basic and diluted net loss per share           $     (0.05)   $       (0.03)
                                                               ===============================
</TABLE>


     As of March 31, 2005 and 2004,  outstanding  options and  warrants  for the
purchase of up to 15,367,888 shares of common stock at prices ranging from $0.52
to $10.50 per share,  and  12,379,867  shares of common stock at prices  ranging
from $0.52 to $11.63 per share, respectively, were anti-dilutive, and therefore,
not included in the computation of diluted loss per share.

     Stock-Based  Compensation  - In December  2002,  the  Financial  Accounting
Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS)
No. 148, "Accounting for Stock-Based  Compensation--Transition  and Disclosure."
This  Statement  amends SFAS No.  123,  "Stock-Based  Compensation,"  to provide
alternative methods of transition for a voluntary change to the fair value based
method of accounting for stock-based employee  compensation.  In addition,  this
Statement  amends  the  disclosure  requirements  of  SFAS  No.  123 to  require
prominent  disclosures in both annual and interim financial statements about the
method of accounting for stock-based employee compensation and the effect of the
method used on reported  results.  The Company  follows APB 25 in accounting for
its employee  stock  options.  The  disclosure  provisions of SFAS 148 have been
incorporated into these financial statements and accompanying footnotes.

     At  March  31,  2005 and  2004,  the  Company  had a  stock-based  employee
compensation  plan. The Company accounts for this plan under the recognition and
measurement   principles  of  Accounting  Principles  Board  (APB)  Opinion  25,
Accounting for Stock Issued to Employees, and related Interpretations.

     The  following  table  illustrates  the effect on net loss had the  Company
applied the fair value recognition  provisions of Financial  Accounting Standard
No. 123,  Accounting  for  Stock-Based  Compensation,  to  stock-based  employee
compensation.

<TABLE>
<CAPTION>

                                                                   Three Months ended
                                                                        March 31,
                                                      ----------------------------------------------
                                                               2005                   2004
                                                      ----------------------------------------------
<S>                                                    <C>                     <C>
        Net loss, as reported                          $      (1,798,171)      $       (769,146)
        Less: Stock-based employee compensation
           expense determined under the fair-
           value based method                                   (271,821)              (461,660)
                                                      ----------------------------------------------
        Net loss, pro forma                            $      (2,069,992)      $    (1,230,806)
                                                      ==============================================
        Basic and diluted net loss per share:
           As reported                                 $           (0.05)                (0.03)
                                                      ==============================================
           Pro forma                                   $           (0.06)      $         (0.04)

     Employee  options  for the  purchase of up to an  aggregate  of 125,000 and
</TABLE>



                                       7
<PAGE>

405,000  shares of common stock were granted during the three months ended March
31, 2005 and 2004,  respectively.  The  weighted  average fair value of employee
options  granted  during the three- month periods ending March 31, 2005 and 2004
was $1.85 and $0.69 per share, respectively.

     The pro  forma  amounts  for net loss per  share in the  table  above  were
estimated  using  the  Black-Scholes  option-pricing  model  with the  following
weighted  average  assumptions  for the  periods  ended March 31, 2005 and 2004,
respectively.


                                                  Three Months ended
                                                       March 31,
                                           ----------------------------------
                                                 2005              2004
                                           ----------------------------------

                Interest rate                         3.30%            3.16%
                Dividend yield                        0.00%            0.00%
                Expected volatility                    107%            123 %
                Expected life in years                 5.00             5.00

     Recent  Accounting  Pronouncements  - In  December  2004,  the FASB  issued
Statement of Financial  Accounting  Standards  No. 123  (Revised),  "Share-Based
Payment" ("SFAS  123(R)").  SFAS 123(R) replaces SFAS 123 and supersedes APB 25.
SFAS 123(R) is  effective  as of the  beginning  of the first  interim or annual
reporting  period that begins after December 15, 2005. SFAS 123(R) requires that
the costs resulting from all share-based  payment  transactions be recognized in
the financial  statements.  SFAS 123(R)  applies to all awards granted after the
required  effective date and shall not apply to awards granted in periods before
the  required  effective  date,  except  if prior  awards  vest,  are  modified,
repurchased  or  cancelled  after the  effective  date.  SFAS 123(R) also amends
Statement of Financial  Accounting  Standards No. 95, "Statement of Cash Flows",
to require  that excess tax  benefits  be  reported  as a financing  cash inflow
rather than as a reduction of taxes paid.

     Certain  reclassifications  have  been  made  to  conform  the  prior  year
financial statements to the presentation of the current period.

3.      EQUITY TRANSACTIONS

     From  November  12, 2004  through  January 12,  2005,  the Company  sold to
accredited investors,  through a private offering,  2,123,000 F Units at a price
of one dollar  ($1.00) per F Unit,  with each F Unit  consisting  of (i) one (1)
share of common stock of the  Company,  and (ii) a warrant to purchase up to one
(1) share of common  stock of the Company at a per share  exercise  price of two
dollars  ($2.00),  exercisable  until November 12, 2007. The gross proceeds from
the offering were  $2,123,000,  of which  $933,000 was received in January 2005.
The Company  issued  963,000  shares in January 2005, of which 30,000 shares had
been recorded as common stock  subscribed  as of December 31, 2004.  The Company
paid  cash  commissions  totaling  $90,350  and  issued  63,181  F Units  to the
placement agent in January 2005 in connection with this private offering.  . The
sales of these  securities  were made in reliance upon Rule 506 and Section 4(2)
of the Securities Act of 1933.

     Beginning  February 1, 2005, the Company  offered warrant holders the right
to exercise  their warrants at the  discounted  price of $1.40 per share.  As of
March 31, 2005,  warrants  representing  2,140,283 shares had been exercised and
the Company issued  1,390,997 of these shares.  The Company expects to issue the
remaining  749,286 shares in the second fiscal  quarter of 2005.  Gross proceeds
were  $2,996,396.  The Company paid cash  commissions  of $109,800 in connection
with the warrant  exercises,  $104,550 was paid during the first quarter of 2005
and $5,250 was paid in April 2005.  As of March 31, 2005,  net cash  proceeds of
the warrant  exercises were $2,891,846.  The sales of these securities were made
in reliance upon Rule 506 and Section 4(2) of the Securities Act of 1933.

     On February 25, 2005, a consultant  exercised an option for 12,886  shares.
The option was  previously  granted in lieu of cash  compensation.  Non-employee
stock  compensation  expense of $3,526 related to the exercise was recognized in
the  first  quarter  of  2005.  An  additional  $1,146  of  non-employee   stock
compensation expense was also recognized for shares that vested during the first
quarter related to an option for a continuing consultant.



                                        8
<PAGE>

     During the three months  ended March 31, 2005, a total of 28,300  shares of
common stock of the Company were purchased through the exercise of stock options
resulting in cash proceeds to the Company of $25,416.

4.      WARRANTS AND STOCK OPTIONS

     As of March 31, 2005, the Company had  outstanding  warrants to purchase up
to  10,355,626  shares of common  stock and options to purchase up to  5,012,262
shares of common stock.  These  securities give the holder the right to purchase
shares  of the  Company's  common  stock in  accordance  with  the  terms of the
instrument.

<TABLE>
<CAPTION>

                                                      Stock
                                                     Options         Warrants          Total
                                                     -------         --------          -----
<S>                           <C> <C>               <C>            <C>             <C>
      Outstanding at December 31, 2004              4,969,448      11,444,728      16,414,176
            Granted                                   125,000       1,126,181       1,251,181
            Retired/forfeited                          41,000               -          41,000
            Expired                                         -          75,000          75,000
            Exercised                                  41,186       2,140,283       2,181,469
                                                ---------------------------------------------------
      Outstanding at March 31, 2005                  5,012,262     10,355,626      15,367,888
                                                ===================================================
</TABLE>


5.       DEFERRED REVENUES

     As of  March  31,  2005,  deferred  revenues  consisted  of  payments  from
customers in advance for software maintenance agreements. The revenues are being
amortized to maintenance  revenue on a  straight-line  basis over 12 months from
the contract date.

6.       BONUSES PAYABLE

     On February 1, 2005 the Company and its Officers agreed that if the Company
raised a certain amount of financing between February 1, 2005 and June 30, 2005,
the  Officers  would be paid a bonus  equal to the  aggregate  amount  that such
Officers'  salaries  had been  reduced  from  October  16,  2004 and until  full
salaries  had been  restored.  In March 2005,  the Company  raised the  required
financing  and in April 2005 the Company  restored  full  salaries  and paid the
bonuses in the aggregate amount of $199,167.

7.       SUBSEQUENT EVENTS

     On April 27, 2005,  the Company  entered into a lease with Bayside Plaza, a
partnership,  for approximately 15,600 square feet of general commercial offices
located  at 700  Airport  Boulevard,  Suite  300,  Burlingame,  California  (the
"Premises"). The Company moved its principal offices to these Premises on May 2,
2005.  The Premises are used for the purposes of general  office use  including,
without limitation,  hosting server operations and for software development. The
lease has an initial  term of three  years,  subject to the  Company's  right to
extend the term of the lease for a total of six additional  years. The base rent
under this lease is $16,060 per month for the first year,  $17,520 per month for
the second  year and $20,440  per month for the third  year.  The  Company  will
receive  abated  rent for the period from May 1, 2005 to July 30,  2005.  In the
event  that the Lease is not  extended,  the total  obligations  of the  Company
hereunder amount to $600,060.

     The Company  expects  that in the second  fiscal  quarter of 2005,  it will
incur  approximately  $175,000  in  expenses  related  to moving  its  principal
offices.  Such  expenses  include:  moving  furniture and  equipment,  leasehold
improvements to the new facility, a new telephone system,  purchase of a limited
amount of office  furniture  and  writing  off  leasehold  improvements  such as
electrical and facilities upgrades that could not be moved from the old offices.

     At the Company's annual meeting of stockholders  held on April 5, 2005 (the
"Annual Meeting"),  stockholders: 1) elected Homer G. Dunn and Robert Henry Kite
as Class 2  directors,  2) voted to amend the  Company's  2000 Stock Option Plan
(the "Plan") to increase the shares  reserved  under the Plan from  5,450,000 to
10,450,000  and 3)  ratified  the  selection  of Burr,  Pilger & Mayer,  LLP, as
independent  accountants  for the Company for the calendar year ending  December
31, 2005. On April 25, 2005 the Board of Directors  granted a total of 1,204,000
stock options to all recently hired,  and certain  existing,  employees at a per
share exercise price of $2.31.



                                       9
<PAGE>

     During April 2005, the Company raised a net total of $1,963,400 as follows:
1) two investors  exercised warrants for a total of 471,000 shares at a price of
$1.40 per share, resulting in gross proceeds to the Company of $659,400, and net
proceeds  after  payment of a $56,000 cash  commission,  of $603,400,  and 2) an
accredited  investor  purchased 850,000 units at a price of one dollar and sixty
cents ($1.60) per unit (the "G Units"),  with each G Unit  consisting of (i) one
(1) share of common stock of the  Company,  and (ii) a warrant to purchase up to
one (1) share of common  stock of the Company at a per share  exercise  price of
three dollars and fifty cents  ($3.50),  exercisable  until April 14, 2008.  Net
proceeds of the G Unit purchase were  $1,360,000.  The sales of these securities
were made in reliance  upon Rule 506 and Section 4(2) of the  Securities  Act of
1933.

ITEM 2.  MANAGEMENT'S PLAN OF OPERATION

     Certain statements contained in this Form 10-QSB constitute forward-looking
statements  within the meaning of Section 27A of the  Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as amended. Such
forward-looking statements herein are based on current expectations that involve
a number of risks and uncertainties.  Such forward-looking  statements are based
on assumptions that the Company will have adequate  financial  resources to fund
the  development  and operation of its  business,  and there will be no material
adverse  change  in  the  Company's   operations  or  business.   The  foregoing
assumptions  are  based on  judgments  with  respect  to,  among  other  things,
information  available to the Company,  future economic,  competitive and market
conditions  and future  business  decisions.  All are difficult or impossible to
predict  accurately  and  many  of  which  are  beyond  the  Company's  control.
Accordingly,  although the Company believes that the assumptions  underlying the
forward-looking statements are reasonable, any such assumption could prove to be
inaccurate and therefore there can be no assurance that the results contemplated
in the forward-looking  statements will be realized. There are a number of risks
presented  by the  Company's  business  and  operations,  which  could cause the
Company's financial  performance to vary markedly from prior results, or results
contemplated by the  forward-looking  statements.  Such risks include failure of
the ANTs technology to work properly, failure to develop commercially successful
products or services from the ANTs technology,  delays or failure in fundraising
efforts,  delays in or lack of market  acceptance,  failures to recruit adequate
personnel,  and problems with protection of intellectual property, among others.
Management decisions,  including budgeting,  are subjective in many respects and
periodic  revisions  must be made to  reflect  actual  conditions  and  business
developments,  the impact of which may cause the  Company  to alter its  capital
investment and other expenditures, which may also adversely affect the Company's
results  of  operations.  In  light of  significant  uncertainties  inherent  in
forward-looking  information  included in this Quarterly  Report on Form 10-QSB,
the inclusion of such information  should not be regarded as a representation by
the Company that the Company's objectives or plans will be achieved. The Company
undertakes  no  obligation  to revise or  publicly  release  the  results of any
revision to these forward-looking statements.

     The Company is engaged in the  development  and  marketing of the ANTs Data
Server, a software  product that is intended to significantly  improve the speed
at which computers can manipulate data. The Company  anticipates  that, over the
next twelve  months its focus will be marketing  its first  product,  supporting
customers, and continued research and development.

Technology Development

     Over the next twelve months, the Company intends to continue to improve and
add  functionality to the ANTs Data Server.  The Company has built out the basic
functionality  to the point  where it believes  that  virtually  all  additional
functionality  will be driven by partner or customer demand. The Company intends
to actively engage prospective  partners and customers in technical  discussions
to  determine  what  features are and will be most in demand for the markets the
Company is targeting.  The Company intends to mobilize its engineering resources
around developing those features.



                                       10
<PAGE>

Marketing

         The Company's go-to-market strategies include:

     o    Focus  on the  high-performance,  high-volume,  transaction  intensive
          industry segments where cost constraints and performance demands might
          dictate a willingness to adopt new technology.  Messaging will feature
          the "high-performance, no compromise" value proposition.

     o    Execute a "compatible  with," not a "replacement of," strategy for the
          leading  RDBMS's  such as:  Oracle,  IBM's DB2,  and  Microsoft's  SQL
          Server,   since  the  RDBMS  market  is  mature  and  customers   have
          substantial investment in infrastructure, development, and support, in
          the leading RDBMS vendors' products.

     o    Sell the ANTs Data Server through three sales channels;

          o    Direct sales to end-users

          o    Through Independent Software Vendors ("ISV") who will incorporate
               the ANTs Data Server with their own product  which they will sell
               to their  customers.  To date,  the  company has signed a license
               agreement with one ISV, Wireless Services Corporation.

          o    Through  System  Integrators  ("SI's") and Value Added  Resellers
               ("VARs") -  companies  which  generally  have deep  expertise  in
               certain  vertical  markets and who integrate the best products to
               develop  complete  solutions for their  customers.  To date,  the
               company  has signed  agreements  with three SI's and VARs:  Grupo
               S&C, Pointe Technology Group and Computer Intelligence Group.

Raising Capital

     The Company  anticipates  that current cash resources will be sufficient to
fund its operations  through November 2005 at its expected rate of spending.  To
carry out its plan of operations,  the Company  anticipates  that, over the next
twelve months, it will require an additional $5 million.  The Company intends to
pursue a number of avenues to raise these additional  operating funds: 1) in the
past the Company has been successful in raising funds through private placements
of its  stock and  anticipates  that it will  continue  to raise  funds  through
private  placements,  2) as the Company develops close  relationships with large
partners, it will pursue strategic  investments from those partners,  and 3) the
Company has begun generating revenue and expects to continue  generating revenue
during the next twelve months, which should be a source of some operating funds.
The Company intends to pursue all three avenues.

Personnel and Appointment of Officers

     The Company  currently  has 31 full-time  employees.  The Company views the
recruitment of additional  qualified  personnel as essential to the development,
marketing and sale of its product.  Over the next 12 months, the Company expects
that its personnel costs will increase  moderately to substantially over current
levels.

     On April 26, 2005,  the Company  entered into  agreements  terminating  the
Salary Agreements  discussed below (the  "Termination  Agreements") with each of
the following persons:  Francis K. Ruotolo, the Company's Chairman, Boyd Pearce,
the Company's  President  and Chief  Executive  Officer,  Kenneth  Ruotolo,  the
Company's Chief Financial  Officer and Secretary,  Clifford Hersh, the Company's
Chief Scientist, Girish Mundada, the Company's Vice President of Engineering and
Jeffrey  R.  Spirn,   Ph.D.,  the  Company's  Vice  President  of  Research  and
Development (each an "Officer").

     In October 2004,  pursuant to salary  agreements by and between the Company
and each Officer  dated as of October 29, 2004 (the "Salary  Agreements"),  each
Officer's  salary  (the  "Original  Salary")  was  reduced  to 50 percent of the
Original  Salary,  and the Company agreed to pay each Officer a bonus,  equal to
the aggregate  amount that such  Officer's  salary had been reduced,  should the
Company  raise a certain  amount  of  financing  between  October  16,  2004 and
February 1, 2005.



                                       11
<PAGE>

     Effective  January 1, 2005,  each  Officer's  salary  was  increased  to 75
percent of the Original Salary  pursuant to amendment  agreements by and between
the Company and each Officer  dated as of January 13, 2005.  The Company did not
raise the  required  financing  by February 1, 2005 and no bonus was paid to the
Officers.

     On February  1, 2005,  the Company  and the  Officers  agreed,  pursuant to
amendment  agreements  by and between the Company and each  Officer  dated as of
February  1, 2005,  that if the  Company  raised a certain  amount of  financing
between  February 1, 2005 and June 30, 2005, the Officers would be paid a bonus,
equal to the aggregate  amount that such Officer's salary had been reduced since
October 16, 2004. In March 2005, the Company  raised the required  financing and
in April 2005, the Company paid the bonuses in  performance  of its  obligations
under the Salary  Agreements,  as amended.  Also in April 2005,  the Company and
Officers  agreed to terminate the Salary  Agreements  and the related  amendment
agreements, and to restore each Officer's salary to the Original Salary.

Patents

     On July 6, 2004,  the United  States Patent and  Trademark  Office  ("PTO")
issued patent  6,760,726  for the ANTs System and Method of Managing  Concurrent
Operations on Linked Lists and on July 13, 2004, the PTO issued patent 6,763,447
for the ANTs  Lock-Free List for use with Computer  System  Utilizing FIFO Queue
for  Tracking  Order of Various  Sublists.  The  Company is  awaiting  the PTO's
response regarding six additional patent applications.

Revenues

     During the first quarter of 2005, the Company  successfully closed the sale
of the ANTs Data Server to two  customers and invoiced an aggregate of $114,100.
The Company recognized $86,767 (comprised of $86,100 in license fees and $667 in
fees for maintenance and support services  already  performed) as revenue on the
statements  of  operations.  The  remainder  of the invoiced  amount  relates to
maintenance  and support  services to be performed after March 31, 2005, and was
recorded as deferred revenue on the balance sheets.

Operating Expenses

     Operating  expenses for the quarters ending March 31, 2005 and 2004 were as
follows:

<TABLE>
<CAPTION>

                                          Operating Expenses - Three Months ended March 31,
                                                  2005                                  2004
                                                  ----                                  ----
                                                           % Change vs.
                              $ in 000's    % of Total     Prior Period       $ in 000's    % of Total
<S>                              <C>           <C>             <C>               <C>           <C>
Sales and marketing              $ 575         30%             297%              $ 145         15%
Research and development           787         42%              71%                460         48%
General and administrative         526         28%              52%                347         37%
                             ----------------------------------------------------------------------------
    Total operating expenses   $ 1,888        100%              98%              $ 952        100%
                             ============================================================================

</TABLE>

     From the first  quarter of 2004 to the first  quarter of 2005,  the Company
has  shifted  focus  primarily  from  development  of the ANTs  Data  Server  to
development,  marketing and selling the ANTs Data Server. While overall expenses
approximately  doubled  quarter over quarter,  marketing and sales expenses have
approximately tripled as the Company has geared up to sell its product.



                                       12
<PAGE>

Sales and Marketing Expenses

     Sales and marketing  expenses  consist  primarily of employee  salaries and
benefits  (related to sales,  sales support - including proof of conversions and
marketing),  consultant fees, travel,  marketing  programs (trade shows,  public
relations,  lead  generation  programs),  marketing  and  sales  literature  and
presentations and allocation of corporate overhead.

     From the  first  quarter  of 2004 to the same  period  in 2005,  sales  and
marketing  expense  increased as follows:  1) a $298,000,  or 290%,  increase in
compensation and benefits expense related to an increase from one to seven sales
and sales support personnel and increased fees paid to marketing consultants; 2)
an increase of $42,000,  or 171%,  in  implementing  marketing  programs;  3) an
increase of $24,000,  or 200% in travel;  and 4) an  increase in  allocation  of
general  corporate  overhead of $60,000,  or 767%,  based on the increase in the
number  of  sales  and  marketing  personnel,  as well as an  increase  in total
corporate overhead expenses.

     The Company  expects that its marketing and sales expenses will continue to
increase  substantially  as more  marketing  and sales  staff are hired and more
programs are implemented.

Research and Development Expenses

     Research and development  ("R&D")  expenses  consist  primarily of employee
salaries and  benefits,  fees to  consultants,  depreciation  on  equipment  and
software,  and  allocation  of corporate  overhead.  During the first quarter of
2004,  the  Company  was still in the basic R&D  process  related  to making the
product  viable for users.  Since then,  the  majority of R&D efforts  have been
devoted to adding  functionality  and testing and refining the product  based on
feedback from customers and potential customers.

     From the first  quarter  of 2004 to the same  period in 2005,  R&D  expense
increased as follows: 1) an increase in compensation expense (salaries, benefits
and consulting fees) of $295,000 or 78% as R&D personnel  increased by 50%, from
10 to 15 people; and 2) depreciation expense increased by $18,000 or 47%, as the
Company  purchased   approximately  $344,000  of  new  equipment  and  leasehold
improvements related to R&D during the 12 months ended March 31, 2005.

     The  Company  expects  that its  research  and  development  expenses  will
increase  moderately  over the next 12  months  as new  engineers  are hired and
hardware is purchased to add functionality and test its product.

General and Administrative Expenses

     General and  administrative  expenses  consist  primarily  of salaries  and
benefits,  consultant fees, legal and investor  relation fees,  recruiting fees,
rent and insurance.

     From the first  quarter  of 2004 to the same  period in 2005,  general  and
administrative  expense  increased  as follows:  1) an increase of $144,000  (or
114%) in salaries,  $100,000 of which was related to payback of reduced  salary,
and $37,500 of which was attributable to the addition of the Company's President
and CEO; and 2) an increase of $30,000 for medical insurance  expenses due to an
increase in rates as well as an increase in the number of people  covered  under
the plan.

     The  Company  expects  that,  over  the next 12  months,  its  general  and
administrative expenses will increase moderately as the Company expands.

     The majority of the Company's operating expenses and costs over the next 12
months are  expected to relate to  marketing  and selling the ANTs Data  Server,
continuing technical development, and supporting customers.

Other Income (Expense), Net

     Other income (expense),  net,  decreased by $179,400,  or 98%, from 2004 to
2005 due to the following:  1) in 2004, the Company recognized $310,943 in other
income related to the  expiration of a contract with Net Soft Systems,  Inc., 2)
in 2004,  a note  receivable  to a former  officer in the amount of $45,000  was
written  off,  and 3) $86,600 in  interest  expense  related to two  convertible
promissory  notes was  recognized in 2004.  Since these notes were  converted to
stock in July 2004, there was no corresponding expense in 2005.



                                       13
<PAGE>

Off-Balance Sheet Arrangements

     During  2003,  the  Company  entered  into an  operating  lease for certain
computer  equipment  used in the Company's  development  lab. The total original
lease obligation was $9,155 and is payable in monthly  installments of $254 over
a three-year  period.  The outstanding  lease  obligation is not reported on the
balance  sheet,  as title to the  equipment  remains  with the lessor  until the
Company pays the total  obligation  and a buyout fee. As of March 31, 2005,  the
total outstanding obligation was $4,833. Should the Company default in its lease
obligation, the lessor could choose to repossess the computer equipment.  Should
the lessor do so, it would not have a material  effect on the Company's  ability
to maintain normal business operations.

     On April 27, 2005,  the Company  entered into a lease with Bayside Plaza, a
partnership,  for approximately 15,600 square feet of general commercial offices
located  at 700  Airport  Boulevard,  Suite  300,  Burlingame,  California  (the
"Premises"). The Company moved its principal offices to these Premises on May 2,
2005.The  Premises  are used for the purposes of general  office use  including,
without limitation,  hosting server operations and for software development. The
lease has an initial  term of three  years,  subject to the  Company's  right to
extend the term of the lease for a total of six additional  years. The base rent
under this lease is $16,060 per month for the first year,  $17,520 per month for
the second  year and $20,440  per month for the third  year.  The  Company  will
receive  abated  rent for the period from May 1, 2005 to July 30,  2005.  In the
event that the Lease is not extended, the total obligations of the Company there
under amount to $600,060.

Critical Accounting Policies

     Use  of  Estimates  -  The  preparation  of  the  financial  statements  in
accordance with accounting principles generally accepted in the United States of
America  requires  management  to make  estimates  and  assumptions  that affect
reported amounts of assets, liabilities, revenues and expenses and disclosure of
contingent  assets and  liabilities.  The Company  evaluates  such estimates and
assumptions on an ongoing basis and bases its estimates on historical experience
and on various other  assumptions  that are believed to be reasonable  under the
circumstances,  the results of which form the basis for making  judgments  about
the carrying values of assets and liabilities that are not readily apparent from
other sources.  Actual results may differ from these estimates and probably will
differ from these estimates under different assumptions or conditions.

     The Company  believes the  following  represents  its  critical  accounting
policies:

     o    Revenue recognition

     o    Stock-based compensation

     o    Income taxes

     Revenue   Recognition  -  We  recognize  revenue  in  accordance  with  the
provisions   of  Statement  of  Position   ("SOP")   97-2,   "Software   Revenue
Recognition",  and  SOP  98-9,  "Modification  of  SOP  97-2,  Software  Revenue
Recognition,  With Respect to Certain Transactions".  Revenue consists primarily
of revenue earned under software  license  agreements  and  maintenance  support
agreements (otherwise known as post-contract customer support or "PCS").

     We use the residual  method to recognize  revenue when a license  agreement
includes one or more  elements to be delivered at a future date.  If there is an
undelivered  element  under the license  arrangement,  we defer revenue based on
vendor-specific   objective  evidence,  or  VSOE,  of  the  fair  value  of  the
undelivered element, as determined by the price charged when the element is sold
separately.  If VSOE of fair value does not exist for all undelivered  elements,
we defer all revenue until sufficient  evidence exists or all elements have been
delivered.  Under the  residual  method,  discounts  are  allocated  only to the
delivered  elements  in a  multiple  element  arrangement  with any  undelivered
elements  being  deferred  based  on  VSOE of fair  values  of such  undelivered
elements.



                                       14
<PAGE>

     Stock-based  Compensation  - The  Company  uses the fair value  recognition
provisions of Financial  Accounting Standard No. 123, Accounting for Stock-Based
Compensation,  to value  stock  options  granted to  employees  and  independent
consultants.  The values are derived  from a model,  which  requires  historical
assumptions and management judgment.  Stock-based  compensation for employees is
disclosed in the pro-forma net loss statement in note 1 of the Company's  annual
financial statements.  Stock-based  compensation for independent  consultants is
expensed in the statement of operations.

     Income Taxes - The carrying value of the Company's  deferred tax assets are
dependent  upon the  Company's  ability to generate  sufficient  future  taxable
income in certain tax jurisdictions.  Until such time as the Company establishes
a taxable  income in such  jurisdictions,  the total  amount of the deferred tax
assets shall be offset with a valuation allowance.

Capital and Liquidity Resources

     The  Company's  cash  balance as of March 31, 2005 was  approximately  $3.4
million and with subsequent financings,  the cash balance as of the date of this
report,  was  approximately  $4.4  million,  which the Company  believes will be
adequate to fund its  activities  through  November 2005 at its expected rate of
spending.  The  Company  is  involved  in  discussions  from  time to time  with
prospective  investors  in order to  raise  capital  to  support  its  continued
operations  and although it has  consistently  raised  capital,  there can be no
assurance  that it will raise capital on acceptable  terms,  or at all. Over the
next twelve months,  if  sufficiently  funded,  the Company  intends to increase
expenditures  moderately to  substantially  as it actively markets and sells the
ANTs Data Server and hires additional sales, marketing, and technical personnel.
There can be no assurance that the Company's  continued product  development and
infrastructure development will not require a much higher rate of spending.

ITEM 3. CONTROLS AND PROCEDURES

     The  effectiveness of the design and operation of the Company's  disclosure
controls and  procedures  (as defined in Rules  13a-15(e)  and  15d-15(e) of the
Securities Exchange Act of 1934, as amended) was evaluated under the supervision
and with the  participation  of the  Company's  management,  including the Chief
Executive  Officer  and Chief  Financial  Officer,  as of the end of the  period
covered by this quarterly report. Based on that evaluation,  the Company's Chief
Executive  Officer and Chief Financial Officer have concluded that the Company's
disclosure  controls  and  procedures  are  effective  in  providing  reasonable
assurance that the information required to be disclosed in this quarterly report
is recorded, processed,  summarized and reported within the time period required
for the filing of this quarterly report.

     There  was no change  in the  Company's  internal  control  over  financial
reporting  (as  defined  in Rules  13a-15(f)  and  15d-15(f)  of the  Securities
Exchange Act of 1934, as amended)  identified in connection  with the evaluation
of the Company's  internal control performed during its last fiscal quarter that
has  materially  affected,  or is reasonably  likely to materially  affect,  the
Company's internal control over financial reporting.


                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     The Company is not a party to any material pending legal proceeding and, to
the best of its  knowledge,  no such action by or against the Company,  has been
threatened.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES

     From  November  12, 2004  through  January 12,  2005,  the Company  sold to
accredited investors,  through a private offering,  2,123,000 F Units at a price
of one dollar  ($1.00) per F Unit,  with each F Unit  consisting  of (i) one (1)
share of common stock of the  Company,  and (ii) a warrant to purchase up to one
(1) share of common  stock of the Company at a per share  exercise  price of two
dollars  ($2.00),  exercisable  until November 12, 2007. The gross proceeds from
the offering were  $2,123,000,  of which  $933,000 was received in January 2005.
The Company  issued  963,000  shares in January 2005, of which 30,000 shares had
been recorded as common stock  subscribed  as of December 31, 2004.  The Company
paid  cash  commissions  totaling  $90,350  and  issued  63,181  F Units  to the
placement agent in January 2005 in connection with this private offering.  . The
sales of these  securities  were made in reliance upon Rule 506 and Section 4(2)
of the Securities Act of 1933.



                                       15
<PAGE>

     Beginning  February 1, 2005, the Company  offered warrant holders the right
to exercise  their warrants at the  discounted  price of $1.40 per share.  As of
March 31, 2005,  warrants  representing  2,140,283 shares had been exercised and
the Company issued  1,390,997 of these shares.  The Company expects to issue the
remaining  749,286 shares in the second fiscal  quarter of 2005.  Gross proceeds
were  $2,996,396.  The Company paid cash  commissions  of $109,800 in connection
with the warrant  exercises,  $104,550 was paid during the first quarter of 2005
and $5,250 was paid in April 2005.  As of March 31, 2005,  net cash  proceeds of
the warrant  exercises were $2,891,846.  The sales of these securities were made
in reliance upon Rule 506 and Section 4(2) of the Securities Act of 1933.

     During April 2005, the Company raised a net total of $1,963,400 as follows:
1) two investors  exercised warrants for a total of 471,000 shares at a price of
$1.40 per share, resulting in gross proceeds to the Company of $659,400, and net
proceeds  after  payment of a $56,000 cash  commission,  of $603,400,  and 2) an
accredited  investor  purchased 850,000 units at a price of one dollar and sixty
cents ($1.60) per unit (the "G Units"),  with each G Unit  consisting of (i) one
(1) share of common stock of the  Company,  and (ii) a warrant to purchase up to
one (1) share of common  stock of the Company at a per share  exercise  price of
three dollars and fifty cents  ($3.50),  exercisable  until April 14, 2008.  Net
proceeds of the G Unit purchase were  $1,360,000.  The sales of these securities
were made in reliance  upon Rule 506 and Section 4(2) of the  Securities  Act of
1933.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     None

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matter was  submitted  to a vote of security  holders  during the period
covered by this report.

ITEM 5.  OTHER INFORMATION

     None

ITEM 6.  EXHIBITS

     (a)  Exhibits

     3.1  Amended and Restated  Certificate of Incorporation of the Company,  as
          listed in  Exhibit  3.1 to the  Company's  10-QSB  filed on August 14,
          2003, is hereby incorporated by reference.

     3.2  Amended and Restated  Bylaws of the Company,  as listed in Exhibit 3.2
          to  the  Company's   10-KSB  filed  on  March  22,  2001,  are  hereby
          incorporated by reference.

     10.1 Letter  Agreement  between the Company and Boyd  Pearce,  as listed in
          Exhibit 10.1 to the  Company's  Form 8-K filed on October 20, 2004, is
          hereby incorporated by reference.

     10.2 Salary Agreement between the Company and Francis K. Ruotolo, as listed
          in Exhibit 10.1 to the  Company's  Form 8-K filed on November 1, 2004,
          is hereby incorporated by reference.

     10.3 Salary  Agreement  between the Company and Boyd  Pearce,  as listed in
          Exhibit 10.2 to the  Company's  Form 8-K filed on November 1, 2004, is
          hereby incorporated by reference.

     10.4 Salary Agreement between the Company and Kenneth Ruotolo, as listed in
          Exhibit 10.3 to the  Company's  Form 8-K filed on November 1, 2004, is
          hereby incorporated by reference.

     10.5 Salary Agreement  between the Company and Clifford Hersh, as listed in
          Exhibit 10.4 to the  Company's  Form 8-K filed on November 1, 2004, is
          hereby incorporated by reference.

     10.6 Salary  Agreement  between the  Company and Jeffrey R. Spirn,  PhD, as
          listed in Exhibit 10.5 to the Company's  Form 8-K filed on November 1,
          2004, is hereby incorporated by reference.

     10.7 Salary Agreement between the Company and Girish Mundada,  as listed in
          Exhibit 10.1 to the  Company's  Form 8-K filed on November 2, 2004, is
          hereby incorporated by reference

     14.  Code of Ethics,  as listed in Exhibit 14 to the Company's 10-KSB filed
          on March 30, 2004, is hereby incorporated by reference.

     31.1 Certification  of  the  Chief  Executive   Officer  required  by  Rule
          13a-14(a)  of the  Securities  Exchange  Act of 1934,  as amended,  as
          adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.



                                       16
<PAGE>

     31.2 Certification  of  the  Chief  Financial   Officer  required  by  Rule
          13a-14(a)  of the  Securities  Exchange  Act of 1934,  as amended,  as
          adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

     32.1 Certification  of the Chief  Executive  Officer  pursuant to 18 U.S.C.
          Section 1350 as adopted pursuant to Section 906 of the  Sarbanes-Oxley
          Act of 2002.

     32.2 Certification  of the Chief  Financial  Officer  pursuant to 18 U.S.C.
          Section 1350 as adopted pursuant to Section 906 of the  Sarbanes-Oxley
          Act of 2002.

(b) Reports on Form 8-K

     During the fiscal  quarter  covered by this report,  the Company  filed the
following  reports on Form 8-K:  (i) On January 6, 2005,  the Company  disclosed
that it entered into an  Indemnification  Agreement  with Robert Henry Kite, the
Company's  newly  appointed  director,  (ii) on January  18,  2005,  the Company
announced  that it  raised  $2,032,650,  net,  in a private  offering,  (iii) on
January  19,  2005,  the  Company  disclosed  that  it  entered  into  Amendment
Agreements  with six Officers,  whereby (a) their salary was increased to 75% of
their  Original  Salary,  effective  January 1,  2005,  and (b) in the event the
Company raised $2.5 million (net of  commissions)  between  November 1, 2004 and
February 2005,  each Officer would be paid a bonus equal to his foregone  salary
from October 16, 2004 through the date of payment of such bonus, (iv) on January
20, 2005, the Company  announced  that it had issued a press release  announcing
that Grupo S&C had licensed  the ANTs Data  Server,  (v) on January 31, 2005 the
Company announced: (a) that it entered into an agreement with Francis K. Ruotolo
to terminate a Separation  Agreement by and between them, dated January 8, 2001,
(b) the resignation of Francis K. Ruotolo as Chief Executive Officer,  effective
February 1, 2005, (c) the appointment of Boyd Pearce as Chief Executive Officer,
effective  February  1,  2005,  (d) the  resignation  of Boyd  Pearce  as  Chief
Operating Officer effective  February 1, 2005 and (e) a shareholder  letter from
Francis K. Ruotolo the Company's  then-current Chief Executive Officer,  (vi) on
February 4, 2005,  the Company  announced  that it had  entered  into  Amendment
Agreements  with six Officers  providing  that, if the Company  raised a certain
amount of financing  between  February 1, 2005 and June 30,  2005,  the Officers
would be paid a bonus equal to the aggregate amount that such Officers' salaries
had been reduced since October 16, 2004 until the date of payment of such bonus,
and (vii) on February 16, 2004,  the Company  issued a  Shareholder  Letter from
Boyd Pearce, President and Chief Executive Officer.

RISK FACTORS

     In addition to other information in this 10-QSB, the following risk factors
should be carefully  considered in evaluating  the Company's  business  since it
operates in a highly  changing and complex  business  environment  that involves
numerous risks, some of which are beyond its control.  The following  discussion
highlights a few of these risk factors,  any one of which may have a significant
adverse  impact on the  Company's  business,  operating  results  and  financial
condition. As a result of the risk factors set forth below and elsewhere in this
10-QSB,  and the risks discussed in the Company's other  Securities and Exchange
Commission filings,  actual results could differ materially from those projected
in any forward-looking statements.

     A failure to obtain  additional  financing  could  prevent the Company from
executing its business plan. A failure to raise additional funding could prevent
the Company  from  continuing  its business  after  November  2005.  The Company
anticipates  that  current  cash  resources  will  be  sufficient  to  fund  its
operations  only through  November  2005 at its expected  rate of spending.  The
Company  believes  that,  due  to  an  uncertain  investment  climate,  securing
additional  sources of financing to enable it to complete  the  development  and
commercialization  of its proprietary  technologies is uncertain and there is no
assurance  of its  ability  to  secure  such  financing.  A  failure  to  obtain
additional  funding could prevent the Company from making  expenditures that are
needed  to pay  current  obligations,  allow  it to hire  additional  personnel,
continue  development of the  technology or attract  customers who are concerned
about its ability to continue operations. If the Company raises additional funds
by selling  equity  securities,  the relative  equity  ownership of its existing
investors  could  be  diluted  or the new  investors  could  obtain  terms  more
favorable  than  previous  investors.  If the Company  raises  additional  funds
through debt financing, it could incur significant borrowing costs.

     The Company  will need to continue  its product  development  efforts.  The
Company believes that its market will be  characterized by increasing  technical
sophistication.  The Company also believes that its eventual success will depend
on its  ability to  continue  to provide  increased  and  specialized  technical
expertise.  There is no assurance that the Company will not fall technologically
behind competitors with greater resources. Although the Company believes that it



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<PAGE>

enjoys a significant  lead in its product  development,  and is hopeful that its
patents  provide some  protection,  it will likely need  significant  additional
capital in order to continue to enjoy such a technological lead over competitors
with more resources.

     If the  Company  is  unable  to  protect  its  intellectual  property,  its
competitive  position would be adversely affected.  The Company relies on patent
protection,  as well as trademark and copyright law, trade secret protection and
confidentiality  agreements  with  its  employees  and  others  to  protect  its
intellectual  property.  Despite the Company's  precautions,  unauthorized third
parties may copy its products and services or reverse engineer or obtain and use
information  that it  regards  as  proprietary.  The  Company  has filed  patent
applications  with the United States Patent and Trademark  Office and intends to
file more. Two patent  applications have been granted and issued;  however,  the
Company does not know if the remaining  applications  will be granted or whether
it will be successful in prosecuting any future patents.  In addition,  the laws
of some foreign countries do not protect  proprietary  rights to the same extent
as do the laws of the United  States.  The  Company's  means of  protecting  its
proprietary  rights  may not be  adequate  and third  parties  may  infringe  or
misappropriate  its  patents,  copyrights,  trademarks  and similar  proprietary
rights.  If  the  Company  fails  to  protect  its  intellectual   property  and
proprietary rights, its business,  financial condition and results of operations
would  suffer.  The  Company  believes  that  it  does  not  infringe  upon  the
proprietary  rights of any third party, and no third party has asserted a patent
infringement claim against it. It is possible,  however, that such a claim might
be asserted  successfully  against the Company in the future. The Company may be
forced to  suspend  its  operations  to pay  significant  amounts  to defend its
rights,  and a  substantial  amount of the  attention of its  management  may be
diverted from its ongoing  business,  which can materially affect its ability to
attain and maintain profitability.

     The Company  focuses on the research  and  development  of its  proprietary
technologies  and the  marketing  and sale of its first  product.  The Company's
present focus is on the  development,  marketing and sale of its first  product.
The  Company  believes  that it has  developed  a highly  marketable  commercial
product. However, there can be no assurance of this, and it is possible that the
Company's  product will only have minimal  commercial  benefit or potential.  In
addition, from the Company's inception to the present, it has not recognized any
substantial operating revenues.

     The Company faces possible  competition from large  companies.  The Company
operates in a highly  competitive  industry.  Although the Company believes that
its  technology  is unique,  can be  protected,  and,  if  adopted,  will confer
benefits that will be otherwise  unavailable for some significant time, it faces
very large competitors with greater  resources who may adopt various  strategies
to block or slow its market  penetration,  thereby  straining  its more  limited
resources.  They  may also  seek to  hinder  the  Company's  operations  through
attempts to recruit key staff with exceptionally attractive terms of employment,
including signing bonuses,  or by offer of highly competitive terms to potential
or newly acquired customers.

     The Company depends on its key personnel and may have difficulty attracting
and  retaining  the  skilled  staff it needs to execute  its growth  plans.  The
Company's  success  will be dependent  largely upon the personal  efforts of its
Chief Executive Officer,  Boyd Pearce and its Chairman,  Francis K. Ruotolo,  as
well as other  senior  managers.  The loss of key staff  could  have a  material
adverse effect on the Company's  business and  prospects.  To execute its plans,
the Company will need to hire  additional  staff and retain  current  employees.
Competition for highly skilled employees with technical, management,  marketing,
sales,  product  development  and other  specialized  training is  intense.  The
Company  may  not be  successful  in  attracting  or  retaining  such  qualified
personnel.  Specifically, the Company may experience increased costs in order to
attract and retain skilled  employees.  If the Company is unable to hire,  train
and manage new skilled and experienced  employees as needed,  it would be unable
to support its planned growth and future operations.

     The Company faces rapid technological  change. The market for the Company's
products  and  services  is  characterized  by  rapidly  changing  technologies,
extensive  research  and the  introduction  of new products  and  services.  The
Company believes that its future success will depend in part upon its ability to
continue to enhance its existing products and to develop, manufacture and market
new products and services.  As a result, the Company expects to continue to make
a significant investment in engineering,  research and development. There can be
no assurance that the Company will be able to develop and introduce new products
and services or enhance its initial  intended  products and services in a timely
manner  to  satisfy  customer  needs,   achieve  market  acceptance  or  address
technological  changes in its target  markets.  Failure to develop  products and
services and introduce them  successfully and in a timely manner could adversely
affect the Company's  competitive  position,  financial condition and results of
operations.



                                       18
<PAGE>

     In the event that the Company  experiences growth, the Company will need to
manage such growth well.  The Company may experience  substantial  growth in the
size of its  staff  and the  scope of its  operations,  resulting  in  increased
responsibilities for management. To manage this possible growth effectively, the
Company  will  need to  continue  to  improve  its  operational,  financial  and
management information systems and to hire, train, motivate and manage a growing
number of staff.  Due to a  competitive  employment  environment  for  qualified
technical,  marketing  and sales  personnel,  the Company  expects to experience
difficulty  in  filling  its  needs  for  qualified  personnel.  There can be no
assurance  that the Company  will be able to  effectively  achieve or manage any
future growth,  and its failure to do so could delay product  development cycles
and  market  penetration  or  otherwise  have a material  adverse  effect on its
financial condition and results of operations.

     The Company could face information and product  liability risks and may not
have adequate  insurance.  The Company's product may be used to manage data from
critical business applications. The Company may become the subject of litigation
alleging  that its product was  ineffective  or  disruptive  in its treatment of
data, or in the  compilation,  processing or manipulation  of critical  business
information. Thus, the Company may become the target of lawsuits from injured or
disgruntled  businesses  or other users.  The Company does not  presently  carry
product or information liability or errors and omissions insurance, and although
it intends to acquire such insurance prior to commencing substantial sales, such
insurance may not be available in an acceptable or affordable form. In the event
that the Company is required to defend more than a few such  actions,  or in the
event that it was found liable in connection  with such an action,  its business
and operations would be severely and materially adversely affected.

     The Company is dependent on new demand for its products and  services.  The
success  of the  Company's  business  depends  upon  demand  for  and use of its
technology,  products  and  services  in general  and the demand for  additional
computing  power,  cost  effectiveness  and speed in  particular.  The Company's
product is new and the Company may encounter  substantial market resistance.  In
the event sufficient demand does not develop, the Company's business and results
of operations would be materially adversely affected.  The Company believes that
there appears to be increased demand for computing power, cost effectiveness and
speed,  but if  general  economic  conditions  decline  or  hardware  and memory
advances make such power, cost  effectiveness and speed more readily  available,
then  adoption,  use and sales of the  Company's  products  and  services may be
materially adversely affected.

     Market acceptance of the Company's products and services is not guaranteed.
The Company is at an early stage of  development  and its  earnings  will depend
upon market  acceptance and  utilization of its intended  products and services.
Due to economic  conditions  potential  customers have  significantly  tightened
budgets for evaluating new products and technologies  and the evaluation  cycles
are much  longer than in the recent  past.  There can be no  assurance  that the
Company's product and technology development efforts will result in new products
and services, or that they will be successfully introduced.

     Future profitability is not guaranteed.  The Company has not recognized any
substantial operating revenues to date. There is no assurance that the Company's
plans will be  realized,  that it will be able to  generate  revenues or that it
will achieve profitability in the future.

     Limited market for the Company's  common stock.  The Company's common stock
is not listed on any  exchange  and trades in the  over-the-counter  (the "OTC")
market. As such, the market for the Company's common stock is limited and is not
regulated  by the  authorities  of  any  exchange.  Further,  the  price  of the
Company's  common  stock and its volume in the OTC market may be subject to wide
fluctuations.

     The Company has a long corporate  existence and was inactive during much of
its  corporate  history.  The  Company  was  formed  as  the  Sullivan  Computer
Corporation, incorporated in Delaware in January 1979. The Company was privately
owned  until late 1986,  at which time its  common  stock  began  trading in the
over-the-counter  market. This was a result of the registration of the Company's
common stock pursuant to the merger with CHoPP Computer  Corporation,  a British
Columbia  corporation.  During the period from mid-1987  through late 1999,  the
Company had few or no employees. The Company's operating activities were limited
and were largely  administered  personally  by its former  Chairman.  Due to the
passage of time and the poor condition of financial and other records, there can
be no assurance that all matters have been addressed at this date.



                                       19
<PAGE>

     The Company has  indemnified  its officers and  directors.  The Company has
indemnified its Officers and Directors  against possible  monetary  liability to
the maximum extent permitted under Delaware law.

     Limitation  on ability for control  through  proxy  contest.  The Company's
Bylaws  provide for a Board of  Directors to be elected in three  classes.  This
classified  Board may make it more  difficult  for a potential  acquirer to gain
control of the Company by using a proxy  contest,  since the acquirer would only
be able to elect one or two directors out of four directors at each shareholders
meeting held for that purpose.



                                   SIGNATURES

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


                                       ANTs software inc.


Date:   May 16, 2005                   By:/s/ Boyd Pearce
                                          ---------------
                                          Boyd Pearce, President,
                                          Chief Executive Officer and Director


Date:   May 16, 2005                   By:/s/ Kenneth Ruotolo
                                          -------------------
                                          Kenneth Ruotolo
                                          Chief Financial Officer and Secretary



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